/raid1/www/Hosts/bankrupt/TCR_Public/050406.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, April 6, 2005, Vol. 9, No. 80
Headlines
ADELPHIA COMMS: Cablevision Joins Bidding Sans KKR & Providence
AMERIKING INC: Trustee Taps R. Schramm as Real Estate Tax Counsel
ARGUS CORP: Needs Funds to Pay Preference Share Dividends
ATA AIRLINES: AMR Leasing Objects to Six Lease Agreements
ATA HOLDINGS: Court Okays Chicago Express Sale to Okun Enterprises
BADGER PAPER: Covenant Breaches Trigger Going Concern Doubt
BIOVAIL CORPORATION: Court Dismisses Two Tiazac Lawsuits
BOMBARDIER INC: Subsidiary Sells 20 More Jets to SkyWest for $637M
BRASOTA MORTGAGE: Case Summary & 20 Largest Unsecured Creditors
CAITHNESS COSO: Moody's Reviews Ba1 Bond Rating & May Upgrade
CHANNEL MASTER: Settles $14 Mil. Tax Dispute with Johnston County
CLEARLY CANADIAN: Dec. 31 Balance Sheet Upside Down by $3.52 Mil.
COLLINS & AIKMAN: Arranges New $75 Million Term Loan Facility
COVANTA ENERGY: Danielson to Acquire American Ref-Fuel Holdings
CREDIT SUISSE: Fitch Rates $9,775,000 Home Equity Certs. at BB+
DIRECTV GROUP: Moody's Assigns Ba1 Rating to New $2.5 Billion Loan
EVOLVED DIGITAL: Dec. 31 Balance Sheet Upside-Down by $722,172
DONNKENNY: Gets Final Approval for $60 Mil. DIP Facility From CIT
FASSBERG CONSTRUCTION: Voluntary Chapter 11 Case Summary
FEDERAL INFORMATION: S&P Rates Proposed $90M Sec. Facility at B+
FERRELLGAS PARTNERS: Fitch Downgrades $271 Mil. Sr. Notes to B+
FUTRONIX INC: Case Summary & 29 Largest Unsecured Creditors
HAMPTON COURT: ASC Alleges Illegal Securities Trading
HINES HORTICULTURE: S&P Revises Outlook to Negative
HOLLINGER INC: No Relief from Regulator's Cease Trade Orders
INTERSTATE BAKERIES: Wants to Walk Away from 6 Real Estate Leases
INVERNESS MEDICAL: Weak Performance Prompts S&P to Lower Ratings
IPIX CORP: Auditors Express Doubt About Going Concern Viability
ISTAR FINANCIAL: Hosting First Quarter Webcast on April 26
IWO HOLDINGS: Court Issues Final Decree Closing Bankruptcy Cases
KEYSTONE CONSOLIDATED: Wants Until Sept. 15 to Solicit Acceptances
KEYSTONE CONSOLIDATED: Inks Settlement Pact with Camden County
KKR FINANCIAL: Moody's Assigns Low-B Ratings to Class E & F Notes
KMART HOLDING: Board of Directors Changes Fiscal Year End
LANDMARK V: Moody's Assigns Ba2 Rating to $12M Class B-2L Notes
LOUISE B. VAUGHN: Case Summary & 24 Largest Unsecured Creditors
MANUFACTURED HOUSING: S&P's Rating on Class B-1 Tumbles to D
MASSMUTUAL: Moody's Reviews Class B Notes for Possible Upgrade
MED REHAB: Case Summary & 23 Largest Unsecured Creditors
MEYER'S BAKERIES: Court Approves Asset Sale to Southern Bakeries
MEYER'S BAKERIES: AEG Partners Approved as Financial Advisors
MIDDLESEX LUMBER: Case Summary & 14 Largest Unsecured Creditors
MIRANT CORP: SEC says Plan of Reorganization Unconfirmable
MIRANT CORP: MAGi Committee Presents "Objectionable" Plan Issues
MISSION RESOURCES: Petrohawk Energy Inks Acquisition Agreement
MISSION RESOURCES: Moody's Reviews $130M Sr. Unsec. Bond Rating
MJ RESEARCH: Court Awards $35 Million More in Patent Litigation
NATIONAL ENERGY: Inks Pact Resolving Brascan Energy's Claims
NATIONAL ENERGY: Wants Court to Extend Claims Objection Deadline
NAVARRE CORP: Terminates Sr. Debt Offering Due to Market Weakness
NORTHWEST ALUMINUM: Judge Dunn Confirms Second Amended Plan
NORTHWESTERN CORP: Wants Ballot Agents to Identify Claim Holders
NRG ENERGY: Hosting Annual Stockholders' Meeting on May 24
OCTANE ENERGY: Closes $5.4 Million Sale of Pronghorn Controls Unit
ORMET CORP: Steelworkers Union Slams Executives' "Huge" Salaries
PAN AMERICAN: Good Financial Performance Cues S&P to Lift Ratings
PAUL ATHAS: Voluntary Chapter 11 Case Summary
PEPPERCORN INC: Voluntary Chapter 11 Case Summary
PNC MORTGAGE: Moody's Affirms Six Low-B Rated Certificate Classes
PROXYMED: Inability to Pay Debt When Due Spurs Going Concern Doubt
RADIANT ENERGY: Equity Deficit Widens to $10.2 Million at Jan. 31
RELIANCE GROUP: Wants Court to Overrule Deloitte's Objection
SAFETY-KLEEN: Oaktree Files Class Action Suit in South Carolina
SEARS HOLDINGS: Owns 100% of Sears Canada After Kmart Merger
SEARS HOLDINGS: Competition Bureau Fines Canadian Unit $487,000
SHAW GROUP: Commencing Tender Offer for 10-3/4% Senior Notes
SHAW GROUP: Earns $9.7 Million of Net Income in Second Quarter
SP NEWSPRINT: Moody's Affirms B1 Rating on $280 Million Debt
SPIEGEL INC: Court Sets Plan Confirmation Hearing on May 25
SYRATECH CORP: Bankruptcy Court Approves Disclosure Statement
TEMBEC INC: Plans to Buy & Operate St. Anne Nackawic Pulp Mill
TENGASCO INC: Losses & Deficits Trigger Going Concern Doubt
THE MARKET: Case Summary & 28 Largest Unsecured Creditors
TRUMP HOTELS: Judge Wizmur Confirms Plan of Reorganization
TRUMP HOTELS: Trump Indiana Will Pay $20.7MM to Settle Tax Claims
TRUMP HOTELS: Inks Pact to Settle ERISA Plaintiff's Objections
TSI TELSYS: Discloses Financial Investments & Strategic Alliances
TSI TELSYS: Taps American Express for Financial Services
UAL CORP: Creditors Panel Gets Court Nod to Retain GCW as Advisor
V.I. TECH: Regains Compliance with Nasdaq Listing Requirements
VERY LTD: Case Summary & 20 Largest Unsecured Creditors
VIP LODGING: Case Summary & 6 Largest Unsecured Creditors
VISTA GOLD: Posts $4.9 Million Net Loss in Fiscal-Year 2004
VWR INT'L: Expands Services to Ireland with AGB Acquisition
WINN-DIXIE: S&P's Rating on Series 1991-1 Certs. Tumbles to D
YOUTHSTREAM MEDIA: To Consolidate Mill Operations Through KES
* Wilmer Cutler Forms Public Policy Practice
* Understanding A.M. Best's Ratings for Canadian Insurers
* Upcoming Meetings, Conferences and Seminars
*********
ADELPHIA COMMS: Cablevision Joins Bidding Sans KKR & Providence
---------------------------------------------------------------
The Wall Street Journal reports, citing people familiar with
the matter, that Cablevision Systems Corp. has submitted a
$16.5 billion cash proposal for the assets of Adelphia
Communications Corp.
According to Journal reporters Dennis K. Berman and Peter Grant,
Cablevision made the proposal by itself and its bid is backed by
Merrill Lynch & Co. and J.P. Morgan Chase & Co.
Last week, The New York Times reported that Cablevision was in
advanced talks to join Kohlberg Kravis Roberts and Providence
Equity Partners in bidding for Adelphia.
As previously reported by The New York Times, KKR and Providence
have already submitted an all-cash bid worth about $15 billion.
Time Warner Inc. and Comcast Corp. is offering $17.6 billion in
stock and cash, according to the Journal's sources.
The bidding and auction process for Adelphia's assets is expected
to conclude several weeks from now.
Headquartered in Coudersport, Pennsylvania, Adelphia
Communications Corporation (OTC: ADELQ) is the fifth-largest cable
television company in the country. Adelphia serves customers in
30 states and Puerto Rico, and offers analog and digital video
services, high-speed Internet access and other advanced services
over its broadband networks. The Company and its more than
200 affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002. Those cases are jointly
administered under case number 02-41729. Willkie Farr & Gallagher
represents the ACOM Debtors.
AMERIKING INC: Trustee Taps R. Schramm as Real Estate Tax Counsel
-----------------------------------------------------------------
George L. Miller, the chapter 7 Trustee overseeing the liquidation
of Ameriking, Inc., and its debtor-affiliates sought and obtained
permission from the U.S. Bankruptcy Court for the District of
Delaware to retain Rieff Schramm & Kanter as his special real
estate tax counsel.
As reported in the Troubled Company Reporter on February 24, 2005,
the Firm will earn a contingent fee equal to 33% of any tax
refunds paid to the Trustee.
To the best of the Trustee's knowledge, Rieff Schramm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Headquartered in Westchester, Illinois, AmeriKing, Inc., operates
approximately 329 franchised restaurants through its subsidiaries.
The Company filed for chapter 11 protection on December 4, 2002
(Bankr. Del. Case No. 02-13515). On June 9, 2004, these cases
were converted to chapter 7 and George Miller was appointed
chapter 7 Trustee. Christopher A. Ward, Esq., and Neil B.
Glassman, Esq., at The Bayard Firm represent the Debtors in their
restructuring efforts. When the Company filed protection from its
creditors, it listed $223,399,000 in assets and $291,795,000 in
debts.
ARGUS CORP: Needs Funds to Pay Preference Share Dividends
---------------------------------------------------------
Argus Corporation Limited (TSX:AR.PR.A)(TSX:AR.PR.D)(TSX:AR.PR.B)
filed alternative financial information for the first three
quarters of 2004 and, with this Report, for the year ended
December 31, 2004. It intends to continue to file alternative
financial information until it is able to file statements prepared
in accordance with GAAP.
The alternative financial information is prepared by management of
Argus and is not audited or reviewed by its auditors, Zeifman and
Company LLP.
Financial Position
-- Cash
Argus had Cdn. $101,002 of cash as of the close of business on
April 1, 2005.
-- Shareholdings
Argus indirectly owns 21,596,387 Common Shares of Hollinger with a
market value at the close of trading on April 1, 2005, on the
Toronto Stock Exchange of Cdn. $6.10 per share or an aggregate of
Cdn. $131,737,961
The market value of Argus' shareholdings is subject to the
minority interest of Ravelston, Argus' parent company. The amount
of that minority interest was stated at December 31, 2004, to be
Cdn. $27,961,203. At that date, the value of Argus' investment in
Common Shares of Hollinger was Cdn. $144,695,793.
The market value of Argus' shareholdings is also subject to future
income taxes on unrealized net capital gains. That amount was
stated to be Cdn. $24,972,978 at December 31, 2004.
Ravelston holds all of Argus' Common Shares and Class C Preference
Shares and 2,900 of Argus' 55,893 issued Class A Preference Shares
$2.60 Series.
-- Dividends
Argus presently requires additional funds to be able to pay the
next dividends that are due to be paid on its Class A and Class B
Preference Shares when they are due to be paid on May 1, 2005, and
future dividends on an uninterrupted basis.
The last dividends were paid on February 1, 2005, with the
proceeds of a loan from Ravelston in the amount of Cdn. $251,703.
The loan bears no interest and is due to be repaid on February 28,
2006. Ravelston has informed Argus that it has not determined
whether it will continue to support Argus in this fashion in the
future.
Argus intends to make efforts to ensure that it will be able to
pay its next scheduled regular quarterly dividends, which are
currently estimated to be Cdn. $251,703.
Fund Needs
The Company presently requires additional funds to be able to meet
its obligations as they fall due, including payments for operating
expenses, future legal expenses, to continue to pay its regular
dividends on its Class A and Class B preference shares and to make
any repurchases of its Class A preference shares.
The Company has traditionally depended for its liquidity upon
dividend income, the sale of investments and the support of its
controlling shareholder, The Ravelston Corporation Limited, and
Ravelston's subsidiary Ravelston Management Inc.
The Company received no dividends from Hollinger in 2004 ($998,000
in 2003) and, given the current situation of Hollinger, it is not
possible to predict when or whether the Company will receive
dividends from Hollinger in 2005.
Cease Trade Order
The Company is currently unable to sell any of its investments in
Hollinger as that company is the subject of a Management and
Insider Cease Trade Order in which Argus is a named party.
On May 25, 2004 the Company became subject to a MCTO by the
Ontario Securities Commission, which MCTO became final on June 3,
2004 and continues to be in place. The Order was initially issued
as a result of the Company not being able to complete and file its
financial statements for the first Quarter of 2004 together with
its related Management's Discussion and Analysis when due on May
15, 2004. Since then, the Company has similarly been unable to
file its financial statements and related MD&A reports for the
second and third Quarters of 2004 and the year ended December 31,
2004.
The delays in filing result from the change in GAAP and
Hollinger's inability to file its financial statements.
The OSC also issued a MCTO on June 1, 2004, against each of
Hollinger and International for the failure of each to file their
audited financial statements for the year ended on December 31,
2003 and interim financial statements for the first Quarter of
2004 and related MD&A reports. Hollinger has been unable to
complete its financial statements because of a material change in
its relationship with International.
Each of the MCTOs was varied by the OSC on March 8, 2005, to add
new parties including persons who had become directors and
officers since the original MCTOs.
The MCTO of the Company prohibits Ravelston and its affiliates and
others from selling shares of the Company without receiving a
specific exemption from the OSC. The MCTO of Hollinger prevents
the Company from selling shares of Hollinger and the MCTO of
International prevents Hollinger from selling shares of
International, without receiving a similar exemption from the OSC.
Argus owns or controls 61.8% of the Retractable Common Shares
These Common Shares are the only significant asset held by Argus.
Hollinger in turn owns 66.8% of the voting shares and 17.4% of the
equity of International.
Hollinger and International have both also been subject to
Management and Insider Cease Trade Orders for their failure to
file financial statements and related reports when required.
Those orders were issued on June 1, 2004.
Based on the company's alternative financial reporting, as of
September 30, 2004, Argus has a $44,034,263 stockholders' deficit
compared to $6,522,159 of positive equity at Dec. 31, 2003.
ATA AIRLINES: AMR Leasing Objects to Six Lease Agreements
---------------------------------------------------------
To recall, Chicago Express Airlines, Inc., sought the United
States Bankruptcy Court for the Southern District of Indiana's
authority to reject 71 executory contracts and unexpired leases.
Jeffrey C. Nelson, Esq., at Baker & Daniels, in Indianapolis,
Indiana, relates that the Agreements are for goods and services,
equipment, or personal and nonresidential real property that is no
longer necessary to the operations of Chicago Express.
Mr. Nelson tells Judge Lorch that Chicago Express Airlines, Inc.
inadvertently included a Software License Agreement with SABRE in
their request to reject certain agreements. Chicago Express does
not seek to reject the SABRE Agreement.
Chicago Express also referenced an agreement with BAA/
Indianapolis Airport Authority. Mr. Nelson clarifies that a
BAA/Indianapolis Agreement does not exist.
Chicago wants the SABRE Agreement and the BAA/Indianapolis
Agreement removed from the list of contracts to be rejected.
In addition, Chicago Express inadvertently omitted two airport
lease and use agreements from the rejected agreements:
(1) The Airport Use and Lease Agreement dated as of May 28,
2002 between Chicago Express and the Metropolitan Airport
Authority of Rock Island County, Illinois; and
(2) The Blue Grass Airport Space/Use Permit between Chicago
Express and the Lexington-Fayette Urban County Airport
Board
Chicago Express vacated and surrendered possession of its space at
the Blue Grass Airport for almost a year now, and the space at the
Quad-City Airport on January 8, 2005.
Mr. Nelson contends that allowing Chicago Express to include the
two agreements among the rejected agreements will not prejudice
the counterparties. Chicago Express will inform the Rock Island
Authority and the Lexington Airport Board of its intent to reject
the agreements effective as of March 31, 2005.
AMR Leasing Objects
Scott Everett, Esq., at Haynes and Boone, LLP, in Dallas, Texas,
relates that AMR Leasing Corporation leased six Saab Model 340B
Aircraft to ATA Airlines, Inc., pursuant to these agreements:
(1) Lease Agreement N334AE (being changed to N312CE) dated as
of September 4, 2002;
(2) Lease Agreement N335AE (being changed to N314CE) dated as
of June 7, 2002;
(3) Lease Agreement N343SB (being changed to N315CE) dated as
of June 26, 2002;
(4) Lease Agreement N906AE (being changed to N316CE) dated as
of May 29, 2002;
(5) Lease Agreement N352SB (being changed to N317CE) dated as
of July; 30, 200; and
(6) Lease Agreement N358RZ (being changed to N318CE) dated as
of May 31, 2002.
ATA Airlines subleased the Aircraft to Chicago Express, Inc.
Mr. Everest notes that, in light of the notices of proposed
rejections filed by the Debtors on March 22, 2005, and based on
the representations made to AMR's counsel from the Debtors'
counsel, it appears that the Debtors do not intend to assume and
assign the Lease Agreements to the winning bidder, if any, under
the proposed sale of Chicago Express. It is also unclear under
the Court-approved Chicago Express sale procedures whether the
Debtors requested permission to sell ATA Airlines' interest in the
Lease Agreements.
AMR wants all defaults must be cured, and adequate assurance of
future performance must be provided, at the time of assumption and
assignment of an executory contract or unexpired lease. AMR
asserts that it is entitled to due process notice of the identity
of any proposed assignee of the Lease Agreements. AMR is also
entitled to a fair opportunity to determine whether any proposed
assignee can provide adequate assurance of future performance.
Moreover, AMR cannot determine whether the Debtors are fully
complying with the terms of the Lease Agreements and thus whether
cures are required. The Debtors must fully address these issues
prior to any proposed assumption and assignment of the Lease
Agreements, Mr. Everest maintains.
Headquartered in Indianapolis, Indiana, ATA Airlines, owned by ATA
Holdings Corp. -- http://www.ata.com/-- is the nation's 10th
largest passenger carrier (based on revenue passenger miles) and
one of the nation's largest low-fare carriers. ATA has one of the
youngest, most fuel-efficient fleets among the major carriers,
featuring the new Boeing 737-800 and 757-300 aircraft. The
airline operates significant scheduled service from Chicago-
Midway, Hawaii, Indianapolis, New York and San Francisco to over
40 business and vacation destinations. Stock of parent company,
ATA Holdings Corp., is traded on the Nasdaq Stock Exchange. The
Company and its debtor-affiliates filed for chapter 11 protection
on Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874). Terry E. Hall, Esq., at Baker & Daniels,
represents the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, they listed
$745,159,000 in total assets and $940,521,000 in total debts.
(ATA Airlines Bankruptcy News, Issue No. 19; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
ATA HOLDINGS: Court Okays Chicago Express Sale to Okun Enterprises
------------------------------------------------------------------
As previously reported, ATA Holdings Corp., parent company of
Chicago Express Airlines, Inc., disclosed that Indianapolis-based
Okun Enterprises, Inc., was selected as the highest and best
bidder at an auction to sell the assets of Chicago Express.
Okun Enterprises, a real estate investment and management firm, is
controlled by Edward H. Okun. Okun's bid was for substantially
all the assets of Chicago Express including the operating
certificate, spare parts and inventory for not more than $4
million. In addition, Okun has agreed to purchase two SAAB 340B
aircraft owned by ATA Airlines, Inc., for $2.44 million.
ATA Holdings, which operates ATA Airlines, bought Chicago Express
for $1.9 million in 1999.
The sale transaction was approved yesterday by the Honorable Basil
Lorch III of the U.S. Bankruptcy Court for the Southern District
of Indiana. The sale is expected to close by May 4.
Headquartered in Indianapolis, Indiana, ATA Airlines, owned by ATA
Holdings Corp. -- http://www.ata.com/-- is the nation's 10th
largest passenger carrier (based on revenue passenger miles) and
one of the nation's largest low-fare carriers. ATA has one of the
youngest, most fuel-efficient fleets among the major carriers,
featuring the new Boeing 737-800 and 757-300 aircraft. The
airline operates significant scheduled service from Chicago-
Midway, Hawaii, Indianapolis, New York and San Francisco
to over 40 business and vacation destinations. Stock of parent
company, ATA Holdings Corp., is traded on the Nasdaq Stock
Exchange. The Company and its debtor-affiliates filed for chapter
11 protection on Oct. 26, 2004 (Bankr. S.D. Ind. Case No.
04-19866, 04-19868 through 04-19874). Terry E. Hall, Esq., at
Baker & Daniels, represents the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they listed $745,159,000 in total assets and
$940,521,000 in total debts.
BADGER PAPER: Covenant Breaches Trigger Going Concern Doubt
-----------------------------------------------------------
Badger Paper Mills, Inc. (Nasdaq SmallCap: BPMI), one of the
nation's leaders in the manufacture of specialty papers and
flexible packaging, reported fourth quarter and full year 2004
results.
For the fourth quarter of 2004, the Company recorded a net profit
of $482,000, excluding an asset impairment charge, compared to a
net loss of $1,312,000 for the comparable 2003 period. Net sales
for the quarter totaled $16,561,000 compared to $14,887,000 for
2003.
For the full year 2004, the Company recorded a net loss of
$7,583,000. The reported loss includes a fourth quarter 2004 non-
cash asset impairment charge of $4,556,000 and a previously
reported $1,303,000 restructuring provision associated with a mid-
year workforce reduction. Net sales for 2004 were $73,109,000
compared to $71,691,000 in 2003. Operating loss, excluding one-
time charges, was $1,974,000 in 2004 compared to $3,878,000 in
2003.
In determining the $4,556,000 asset impairment charge, the Company
relied on a discounted cash flow model that incorporates estimates
of future cash flows (cash inflows less associated cash outflows)
directly associated with, and that were expected to arise as a
direct result of, the use of the Fourdrinier paper machine and
related group assets. The circumstances related to this impairment
charge were market related, namely the impact of increased fiber,
chemical and energy, and the difficulty in recovering those costs
through increased product pricing.
The 2004 increase in sales was partially attributable to higher
shipment volume related to new business development activities. A
workplace redesign process, begun in 2003, resulted in a reduction
in 2004 labor costs, improved manufacturing efficiencies and
quality, and reduced waste.
Pulp costs, one of the Company's main raw materials, continued to
increase during 2004, and energy costs, particularly natural gas,
ended the year at historically high levels. In addition,
health/medical costs increased dramatically during 2004.
Notwithstanding the mentioned cost increases, the Company was
successful in controlling other cost of sales elements
contributing to the favorable year-to-year development in gross
profit. Selling, general and administrative expenses for 2004 were
less than the previous year as the beneficial effects of
implemented cost containment programs were realized.
Financial Covenant Problems
Prompt Going Concern Doubt
As a result of the asset impairment charge and other factors in
the Company's Annual Report on Form 10-K for the year ended
December 31, 2004, which Badger filed with the Securities and
Exchange Commission, the Company is in violation of certain
financial covenants under its various credit agreements with its
lenders and the Company's auditors issued a "going concern" to the
Company's 2004 audited consolidated financial statements. The
Company is currently engaged in negotiations with its lenders with
respect to waiving such covenant violations and revising the
applicable financial covenants going forward.
The Company has hired a consultant to assist in developing a
market strategy focused on exploiting its expertise in specialty
paper grades and utilizing the Company's diverse manufacturing and
converting capabilities. In addition, the consultant is working
with the Company to improve profitability.
About the Company
Headquartered in Peshtigo, Wisconsin, Badger Paper Mills, Inc. --
http://www.badgerpaper.com/-- operates manufacturing facilities
in Peshtigo and Oconto Falls, Wisconsin. The Company produces
both virgin and recycled papers as well as printed and waxed
packaging products for customers primarily located throughout
North America.
BIOVAIL CORPORATION: Court Dismisses Two Tiazac Lawsuits
--------------------------------------------------------
Biovail Corporation (NYSE:BVF)(TSX:BVF) reported that a United
States District Judge for the District of Columbia has granted
Biovail's motions for summary judgment, thereby dismissing
complaints in two related putative class-action cases asserting
antitrust claims by purchasers of Biovail's Tiazac(R) product.
The complaints, launched in 2001 and 2003, alleged that Biovail's
listing with the U.S. Food and Drug Administration (FDA) of a
patent for Tiazac(R) improperly delayed the entry of a competing
generic product. Plaintiffs further alleged that the delay in
entry of a generic product into the market caused them to pay a
premium to purchase Biovail's brand-name product.
In its summary judgment motion, Biovail contended that the reason
why the owner of generic Tiazac(R) had not marketed its product on
a timely basis was due to its inability to obtain final FDA
approval, rather than through any action or omission on the part
of Biovail.
In granting Biovail's motions for summary judgment, the Court
agreed with Biovail's position that, in light of the evidence and
facts pleaded, the plaintiffs had been unable to prove that they
had suffered any damages for which Biovail could be responsible.
About Tiazac(R)
Tiazac(R) (diltiazem) belongs to a classification of drugs known
as calcium channel blockers currently indicated for the treatment
of hypertension and angina. Tiazac(R) works by slowing the heart
rate, and by relaxing and widening blood vessels (arteries), which
reduces blood pressure. Widening of the coronary arteries also
increases the amount of blood reaching the heart, which can reduce
the symptoms of angina.
About Biovail Corporation
Biovail Corporation -- http://www.biovail.com/-- is an
international full-service pharmaceutical company, engaged in the
formulation, clinical testing, registration, manufacture, sale and
promotion of pharmaceutical products utilizing advanced
drug-delivery technologies.
* * *
As reported in the Troubled Company Reporter on March 11, 2004,
Standard & Poor's Ratings Services revised its outlook on the
pharmaceutical company to negative from stable. At the same time,
S&P affirmed its ratings on Mississauga, Ontario-based Biovail,
including the 'BB+' long-term corporate credit rating. The action
was in response to the company's lower 2004 earnings guidance.
BOMBARDIER INC: Subsidiary Sells 20 More Jets to SkyWest for $637M
------------------------------------------------------------------
Bombardier Aerospace (TSX:BBD.MV.A)(TSX:BBD.SV.B) said SkyWest
Airlines of St. George, Utah has placed a firm order for 20
additional Bombardier CRJ700 regional jets to increase its CRJ700
fleet to 52 aircraft.
The firm order is valued at approximately US$637 million.
"The CRJ700 aircraft's low operating costs really shine in today's
challenging airline market environment and this order is another
testament to the fact that we've got the economics right," said
Steven Ridolfi, president, Bombardier Regional Aircraft, noting
that the operating cost of the CRJ700 airliner is 10 per cent
lower than its closest competitor. "With the CRJ700 airliner, we
have the right combination of economics, passenger comfort and
commonality."
SkyWest's CRJ700 aircraft, of which 23 were in service as of
February 28, 2005, all fly under the United Express banner for
United Airlines from bases in Chicago, Denver, Los Angeles and San
Francisco.
SkyWest also operates 125 50-seat Bombardier CRJ200 regional jets.
When all firm orders have been delivered, SkyWest will be
operating a total of 177 CRJ aircraft.
"The cabin comfort and inflight amenities provided to our
passengers allow us to make best use of the CRJ700 aircraft's
range capability so we have flights approaching three hours in
length," said Jerry Atkin, chairman, president and chief executive
officer, SkyWest Airlines. "We are able to operate the aircraft
in stage lengths up to 1,500 miles. Thus, we can serve United's
long, thin routes at considerable cost savings to them."
As of February 28, 2005 Bombardier had delivered 1,226 CRJ
aircraft to customers in Africa, Asia, Australia, Europe, North
America and South America. The CRJ program is the sixth best-
selling commercial jet program in history. SkyWest recently took
delivery of the 200th CRJ700 manufactured in the Bombardier CRJ700
program.
A world-leading manufacturer of innovative transportation
solutions, from regional aircraft and business jets to rail
transportation equipment, Bombardier Inc. --
http://www.bombardier.com/-- is a global corporation
headquartered in Canada. Its revenues for the fiscal year ended
Jan. 31, 2005, were $15.8 billion US and its shares are traded on
the Toronto Stock Exchange (BBD).
Bombardier, CRJ, CRJ200 and CRJ700 are trademarks of Bombardier
Inc. or its subsidiaries.
* * *
As reported in the Troubled Company Reporter on Mar. 18, 2005,
Standard & Poor's Ratings Services would keep its ratings on
Bombardier, Inc., and its subsidiaries, on CreditWatch with
negative implications, where they were placed Dec. 13, 2004. The
ratings remain on CreditWatch pending the company's release of its
annual results, and meetings between Standard & Poor's and the
company's senior management.
"Bombardier recently announced that it would be offering a new C-
series aircraft line for sale aimed at the 110-130 seat segment,"
said Standard & Poor's credit analyst Kenton Freitag. The
announcement falls short of a full launch, with decisions still to
be made on government and supplier support and the company will be
seeking firm customer commitments prior to launch. "The company
has estimated development costs of about US$2 billion," added Mr.
Freitag.
The C-series aircraft signals a continuing interest by Bombardier
to compete in the commercial aerospace segment. Bombardier aims
to exploit a market niche by offering an aircraft that is
comparable in size to Boeing Co. (A/Stable/A-1) and Airbus's
smallest offerings (the 737-600 and A318) and Embraer's largest
aircraft (the 190/195). The company expects that its aircraft
will be lighter and offer better operating market economics than
current competing offerings and will target airlines that will be
retiring DC-9s and older B-737s.
There are significant risks to new aircraft development.
Development costs frequently balloon beyond original estimates,
market reception is uncertain, and the costs beyond development
(working capital, financing subsidies, and residual value support)
can be onerous. The market segment that Bombardier is focusing on
has experienced a particularly high failure rate in the past; the
economics would likely need to be very compelling to overcome
concerns about fleet commonality and an unproven operating
history. Finally, a targeted competitive response to the C-series
from Boeing or Airbus could seriously handicap the jet's potential
for success.
Bombardier estimates that its share of development costs would be
about US$700 million spread out over the next five years, and that
it will substantially finance its portion out of operating cash
flows. At this time, however, Bombardier's future cash flows are
very uncertain and even modest incremental development costs could
strain the company's financial profile.
Although Standard & Poor's expects to discuss these issues with
management in forthcoming meetings, resolution of the CreditWatch
will be primarily focused on near-term financial issues.
Standard & Poor's subsequently expects to resolve the CreditWatch
in April 2005. Any downgrade would likely be limited to one or
two notches, provided liquidity remains adequate. Conversely,
ratings could be affirmed if there are indications that the
company's financial position has stabilized.
A world-leading manufacturer of innovative transportation
solutions, from regional aircraft and business jets to rail
transportation equipment, Bombardier, Inc. --
http://www.bombardier.com/-- is a global corporation
headquartered in Canada. Its revenues for the fiscal year ended
Jan. 31, 2004 were $15.5 billion US and its shares are traded on
the Toronto and Frankfurt stock exchanges (BBD and BBDd.F).
* * *
As reported in the Troubled Company Reporter on Dec. 15, 2004,
Standard & Poor's Ratings Services placed its ratings, including
its 'BB' long-term corporate credit ratings, on transportation-
equipment manufacturer Bombardier, Inc., and its subsidiaries on
CreditWatch negative.
"The CreditWatch placement reflects new uncertainty about
Bombardier's financial policies and strategic direction following
the resignation of the company's CEO," said Standard & Poor's
credit analyst Kenton Freitag. The increased uncertainty adds to
Standard & Poor's previously stated concerns, formerly reflected
in a negative outlook, that adverse developments in the U.S.
airline industry could further affect the company's profitability.
BRASOTA MORTGAGE: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: Brasota Mortgage Company, Inc.
820 43rd Street West
Bradenton, Florida 34209
Bankruptcy Case No.: 05-06215
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Funding Management Corporation 05-06218
Type of Business: The Debtor is full service mortgage lender.
Chapter 11 Petition Date: April 4, 2005
Court: Middle District of Florida (Tampa)
Debtors' Counsel: Heath A Denoncourt, Esq.
Hinshaw & Culbertson LLP
100 South Ashley Drive, Suite 500
Tampa, Florida 33602
Tel:(813) 276-1662
Fax:(813) 276-1956
Estimated Assets Estimated Debts
---------------- ---------------
Brasota Mortgage More than More than
Company, Inc. $100 Million $100 Million
Funding Management $1 Million to $1 Million to
Corporation $10 Million $10 Million
Consolidated List of Debtors' 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Charles Sirovy $2,241,000
3708 Hlmes Boulevard
Holmes Beach, FL 34218
Bruce W. Manning Trust $1,175,000
5828 Carriage Drive
Sarasota, FL 34243
McHenry Family Trust $974,400
7352 E. Sage Drive
Paradise Valley, AZ 85253
Charles F. or Eileen M. Dubs $900,000
Sarasota, FL 31298
George N. Lereovre $758,720
Laguna Woods, CA 92688
[Unclear Text] Family Trust $616,465
Llorona, MI 45190
Christopher Dubs $583,000
Sarasota, FL 24299
Elva Lorenz or Ruth L. [Unclear Text] $575,000
Ashland, WI 54806
James A. Grant $504,000
Hot Springs, VA 71809
Alfred M. Wedd $500,000
Bradenton, FL 34209
The Vitality Seed Co. $481,000
Profit Sharing and
Retirement Trust
2428 Bay Drive
Bradenton, FL 34207
Paul [Unclear Text] $450,000
Bradenton Florida 34209
[Unclear Text] $438,000
Bradenton Florida 34210
Retirement Accounts Inc. $410,300
Denver Co 80217-3785
John Losik or Shirley Losik $409,000
Palmano, FL 34221
Richard Dennis Stripling $400,000
Bradenton, FL 34208
Iris G. Stripling $400,000
Bradenton Florida 34208
Nicholas S. or Mary Jane [Unclear Text] $400,000
Bradenton Beach, Fl 34217
[Unclear Text] $386,000
Plamano, Fl 34221
Maureen D. Gregg $376,000
PO BOX 14954
Bradenton FL 34280
CAITHNESS COSO: Moody's Reviews Ba1 Bond Rating & May Upgrade
-------------------------------------------------------------
Moody's Investors Service placed the Ba1 senior secured notes of
Caithness Coso Funding Corp. under review for possible upgrade.
The rating action reflects the improved credit quality in the off-
taker, Southern California Edison Company (SCE: Baa1 senior
unsecured, stable outlook), and the benefit to the project that
results from the signing of a new agreement by two of its
partnerships, Navy I and Navy II Partnership, with the U.S. Navy.
The new agreement, which terminates the existing contracts that
were due to expire on December 31, 2009, extends the exclusive
right of the Navy I and Navy II Partnerships to explore, develop
and use geothermal resources on U.S. Navy lands through
October 31, 2034.
Among the terms of the new agreement, the royalty paid by the Navy
I and Navy II Partnerships to the U.S. Navy through 2009 has been
reduced, the tenor has been extended for 25 years, and the U.S.
Navy's right to terminate the contract for convenience has been
eliminated. Moody's believes that the extension of the contracts
lowers the Caithness Coso partnerships' operating costs, reduces
uncertainties about future fuel supply, and provides management
with a long-term incentive to continue exploring and developing
these geothermal resources.
Under the current tariff arrangement with SCE, the utility pays
the Caithness Coso partnerships a capacity payment and an energy
payment of 5.37 cents/kWh. The energy payment arrangement with
SCE expires in May 2007, about 32 months prior to the scheduled
maturity of the bonds. Thereafter, the Caithness Coso
partnerships are expected to receive compensation for energy based
upon SCE's short-run avoided costs, an amount which is indexed to
natural gas prices. While uncertainty exists concerning the
outcome of SRAC compensation, Moody's believes that the Caithness
Coso partnerships have fairly competitive operating costs,
particularly with the new agreement with the U.S. Navy, to manage
this pricing risk. Moreover, as a renewable resource with long-
term access to fuel supply, the project has long-term importance
to load serving entities in California.
The review will examine the financial impact on the Caithness Coso
partnerships under the new arrangement with the U.S. Navy. The
review will consider these changes relative to expectations
concerning the outcome of SRAC and future natural gas prices.
The review will also include an assessment of Caithness Energy's
track record as operator and as owner of the Caithness Coso
partnerships.
Caithness Coso is a special purpose corporation and a wholly owned
subsidiary of the Caithness Coso partnerships:
1. Coso Finance Partners;
2. Coso Energy Developers; and
3. Coso Power Developers.
Caithness Coso was formed for the purpose of issuing the senior
secured notes on behalf of the Coso partnerships who have jointly,
severally, and unconditionally guaranteed repayment of the senior
secured notes. The Coso partnerships and their affiliates own the
exclusive right to explore, develop, and use a portion of the Coso
Known Geothermal Resource Area in California.
Caithness Coso and the Caithness Coso partnerships are majority
owned by Caithness Energy, a project developer and sponsor.
Privately held, Caithness Energy is majority owned by Caithness
Equities, which is headquartered in New York City.
CHANNEL MASTER: Settles $14 Mil. Tax Dispute with Johnston County
-----------------------------------------------------------------
Montague S. Claybrook, the Chapter 7 Trustee appointed in Channel
Master Holdings, Inc., and its debtor-affiliates' chapter 7 cases,
sought and obtained the United States Bankruptcy Court for the
District of Delaware's approval of a letter of agreement between
the Trustee and Johnston County, North Carolina, resolving their
property taxes dispute.
On December 3, 2003, the Court entered an order converting the
Chapter 11 cases to Chapter 7 cases under the 11 USC Bankruptcy
Code. The Debtors owned and previously operated a portion of its
manufacturing operations from an approximately 750,000 square foot
facility located at 1315 Industrial Park Drive, Smithfield, North
Carolina. The Trustee is currently attempting to sell the
property, the land on which it is situated, and certain fixtures
and equipment at the facility.
$14 Million Dispute
Johnston County, North Carolina, filed claims asserting amounts
due and owing for real property and personal property taxes
related to the property and the Debtors' operations. Johnston
County based the real property taxes on a value of approximately
$14,775,000, pursuant to a revaluation conducted by Johnston
County in 2003.
Letter Agreement
The Trustee disputed the taxes for various reasons, including,
contesting the revaluation amount for the property asserted by
Johnston County. The Trustee and Johnston County, with the
consent of Comerica Bank, the Agent to the prepetition and
postpetition lenders, agreed to resolve the dispute regarding the
taxes. The parties entered into a letter agreement on January 19,
2005, to fully and finally resolve the taxes.
The Letter Agreement provides, inter alia:
a. The County's claim for the taxes will be reduced to and
fixed at these amounts:
2003 Real Property $177,155.17
2004 Real Property $162,155.76
2003 Personal Property $234,239.75
b. No further interest or penalties will accrue on the 2004
real property taxes, provided those taxes are paid in full
no later than June 1, 2005.
c. No further interest or penalties will accrue on the 2003
real and personal property taxes, provided those taxes are
paid in full out of the proceeds of the sale of the Property
at the time of closing of the sale. There will be no
deadline for completion of the sale of the property.
d. The Agent is the holder of a deed of trust encumbering the
property. The Agent is a third party beneficiary of this
agreement and consents to the terms of the agreement.
Headquartered in Smithfield, North Carolina, Channel Master
Holdings, Inc., with the Debtor-affiliates, are leading designer
and manufacturer of high-volume, superior quality antenna products
for the satellite communications industry both in the U.S. and
internationally. The Company filed for chapter 11 protection on
October 2, 2003 (Bankr. Del. Case No. 03-13004). David B.
Stratton, Esq., at Pepper Hamilton LLP represents the Debtors in
their restructuring efforts. When the Company filed for
protection from its creditors, it listed estimated debts and
assets of over $50 million each.
CLEARLY CANADIAN: Dec. 31 Balance Sheet Upside Down by $3.52 Mil.
-----------------------------------------------------------------
Clearly Canadian Beverage Corporation (CNQ:CCBC)(OTCBB:CCBC)
reported consolidated financial results for the year ended
December 31, 2004.
Net loss from operations for the year ended December 31, 2004, was
$5,086,000 or $0.66 per share on a basic and diluted basis on
sales revenues of $11,586,000, compared to a loss of $3,713,000 or
$0.55 per share on a basic and diluted basis on sales revenues of
$13,270,000 for the year ended December 31, 2003. Included in the
net loss for the year, was the write-down of the Company's water
source properties in the amount of $721,000 and the write-down of
distribution rights in the amount of $1,536,000. This write-down
is with respect to the purchase price previously paid by the
Company when it bought back certain distribution rights from its
former master distributors. The write-down does not reflect the
overall Clearly Canadian(R) brand value and the value of the
Company's current distribution rights, which are viewed by the
Company as being valuable assets.
Operating loss (Gross Profit less Selling, General and
Administrative expenses) for the year ended December 31, 2004, was
$2,049,000 compared to $2,244,000 for the year ended December 31,
2003. The year over year decrease in revenue was attributable to
a decrease in sales of brand Clearly Canadian and the Company's
licensed Reebok products, partially offset by an increase in
private label business.
In 2003, Reebok International Inc. elected not to renew its
licensing agreement with the Company to manufacture, distribute
and sell certain Reebok products. Sales in 2004 included a
depletion period to sell off the remaining Reebok branded
products. Accounting for the sell off period in 2004, Reebok
branded sales were off by $1,117,790 or by 80%, as compared with
2003. The Company's private label business experienced
significant growth in 2004, as compared with the same period in
2003.
The Company has plans to cultivate further growth in its private
label business in 2005.
The Company attributes the decline in sales to a challenging year
with respect to available working capital, which contributed to
having to limit certain marketing and sales programs for brand
Clearly Canadian. In 2004, the Company was successful in
arranging secured bridge loans and private placement funding that
facilitated ongoing general working capital needs in the year.
However, going forward, it will be necessary for Clearly Canadian
to secure additional financing in order to support the Company's
operations and relations with existing suppliers and vendors and
to allow for more aggressive marketing and sales activities for
its beverage products.
"In order to successfully and effectively continue with the
implementation of the Company's corporate plan for 2005, it will
be necessary to obtain funding that will enable us to employ more
aggressive field marketing and sales activities designed to
broaden distribution and availability of brand Clearly Canadian
and allow us to explore alternatives to further utilize the
valuable Clearly Canadian brand name. In response to these needs,
the Company intends to present at its shareholders meeting on
April 29, 2005, a corporate restructuring and refinancing plan
that we believe will assist in our efforts to achieve our goals
and concurrently enhancing shareholder value," said Douglas Mason,
President and C.E.O. of Clearly Canadian Beverage Corporation.
Selling, general and administrative expenses from operations were
$5,587,000 for the year ended December 31, 2004 compared to
$5,554,000 for the same period in 2003. In 2004, the Company
closely controlled its spending in all areas of selling, general
and administrative expenses.
To assess the Company's 2004 and 2003 SG&A results on a comparable
basis, in 2003 the Company recovered $387,000 in accrued expenses.
Without these accrued expenses, the Company's SG&A would have been
$5,941,000 in 2003. After accounting for this adjustment in 2003,
the Company has actually decreased its SG&A by $354,000 in 2004,
representing a reduction of 6.0% as compared to the same period in
2003.
Gross profit margins from operations were 30.5% for the year ended
December 31, 2004 compared with 24.9% for the corresponding period
in 2003. This represents gross profit of $3,538,000 for the year
ended December 31, 2004 compared to $3,310,000 for the
corresponding period in 2003. In 2003, the Company wrote off
Reebok product, which accounted for 3.2% of the decline in gross
margin in that year. Excluding the write off, the Company's gross
profit for 2003 would have been 28.1%. The increase in gross
profit in 2004 is attributable for the most part to a change in
the Company's sales mix, with a higher percentage of total sales
being from its private label and oxygenated water segments and
less sales from its Reebok brands as compared with the same period
in 2003.
"In 2004, the Company continued its efforts to establish stronger
distributors in key regions for brand Clearly Canadian, including
the Pacific Northwest and New York City, in an effort to increase
the presence of the brand in these important markets.
Strengthening Clearly Canadian's distribution network remains a
key component in the Company's goal to rebuild distribution for
brand Clearly Canadian in the "all-other-market" segment on a
national level," said Douglas Mason, President and C.E.O. of
Clearly Canadian Beverage Corporation.
"In the first quarter of 2005, our marketing and selling efforts
will be focused on achieving meaningful distribution and
availability improvements in certain markets. Critical to
executing this strategy is the strengthening of our field sales
team and the addition of a "Market Specialist" role. The Market
Specialist position is one with a singular deliverable mandate ...
to increase availability in the all-other-market segment. This
segment, is for the most part, comprised of non-chain affiliated
accounts, and offers the strategic imperative of "cooler door"
availability," said Mr. Mason.
About Clearly Canadian
Based in Vancouver, B.C., Clearly Canadian Beverage Corporation --
http://www.clearly.ca/-- markets premium alternative beverages
and products, including Clearly Canadian(R) sparkling flavoured
water, Clearly Canadian O+2(R) oxygen enhanced water beverage and
Tre Limone(R) which are distributed in the United States, Canada
and various other countries.
As of Dec. 30, 2004, Clearly Canadian's balance sheet showed a
$3,515,000 stockholders' deficit, compared to $1,125,000 in
positive equity at December 31, 2003.
COLLINS & AIKMAN: Arranges New $75 Million Term Loan Facility
-------------------------------------------------------------
Collins & Aikman Corporation (NYSE: CKC) arranged for an
additional $75 million in committed term loan financing under its
existing senior secured credit facilities. The funds will be used
for capital expenditures or to replenish funds used for capital
expenditures. It is expected that the term loan funding will
occur within a week in connection with and subject to receipt of
senior lender approvals of certain credit facility amendments.
These amendments will modify certain financial covenants and
pricing terms.
The Company's available liquidity (cash and unutilized commitments
under revolving credit and account receivables facilities) was
approximately $81 million at March 31, 2005, as compared with
approximately $86 million at December 31, 2004. Continued access
to credit facilities in satisfactory amounts is essential to the
Company. As of March 31, 2005, the Company's outstanding debt
balance was approximately $1.708 billion. Credit Suisse First
Boston has committed to provide this $75 million term loan
financing.
"There is no assurance that the term loan facility will be
completed," Collins & Aikman warns without any further
explanation.
About the Company
Collins & Aikman Corporation -- http://www.collinsaikman.com/-- a
Fortune 500 company, is a global leader in cockpit modules and
automotive floor and acoustic systems and is a leading supplier of
instrument panels, automotive fabric, plastic-based trim, and
convertible top systems. Headquartered in Troy, Michigan, we have
a workforce of approximately 23,000 and a network of more than 100
technical centers, sales offices and manufacturing sites in 17
countries throughout the world.
* * *
As reported in the Troubled Company Reporter on April 1, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Troy, Mich.-based Collins & Aikman Corp. to 'CCC+' from
'B' and removed the rating from CreditWatch where it was placed
March 5, 2005. At the same time, the senior secured, senior
unsecured, and subordinated debt ratings on the company were also
lowered and removed from CreditWatch.
Collins & Aikman has total debt of about $2 billion. S&P says the
rating outlook is negative.
"The rating actions reflect the company's poor cash flow
generation, high debt leverage, and constrained liquidity that
have resulted from the intense challenges of the automotive
industry, combined with concerns about accounting misstatements
and material internal financial control weaknesses," said Standard
& Poor's credit analyst Martin King. "The industry outlook
continues to be uncertain. Ratings could be lowered if it appears
that Collins & Aikman's operating performance will remain
depressed or liquidity constrained."
COVANTA ENERGY: Danielson to Acquire American Ref-Fuel Holdings
---------------------------------------------------------------
In its annual report filed with the Securities and Exchange
Commission, Covanta Energy Corporation President and Chief
Executive Officer Anthony J. Orlando discloses that Danielson
Holding Corporation, the parent of Covanta, entered into a stock
purchase agreement with American Ref-Fuel Holdings Corp., and
Ref-Fuel's stockholders on January 31, 2005. Danielson intends to
purchase 100% of the issued and outstanding shares of Ref-Fuel
capital stock.
Ref-Fuel is an owner and operator of waste-to-energy facilities in
the northeast United States.
Under the terms of the Purchase Agreement, Danielson will pay
$740 million in cash for Ref-Fuel's stock, and will assume
Ref-Fuel's consolidated net debt, which as of December 31, 2004,
was $1.2 billion, net of existing debt service reserves and other
restricted funds held in trust to pay debt service. After the
transaction is completed, Ref-Fuel will be a wholly owned
subsidiary of Covanta.
Mr. Orlando says the acquisition is expected to close when all of
the closing conditions to the Purchase Agreement have been
satisfied or waived. These closing conditions include the receipt
of approvals, clearances and the satisfaction of all waiting
periods as required under the Hart-Scott-Rodino Antitrust Act of
1976 and as required by certain governmental authorities like the
Federal Energy Regulatory Commission and other applicable
regulatory authorities. Other closing conditions of the
transaction include:
(a) Covanta's completion of debt financing and an equity Ref-
Fuel Rights Offering;
(b) Danielson arranging letters of credit or other financial
accommodations aggregating $100 million to replace two
currently outstanding letters of credit that have been
entered into by two subsidiaries of Ref-Fuel and issued in
favor of a third subsidiary of Ref-Fuel; and
(c) other customary closing conditions.
While it is anticipated that all of the applicable conditions will
be satisfied, Mr. Orlando says there is no assurance as to whether
or when all of those conditions will be satisfied or, where
permissible, waived.
Either Danielson or the selling stockholders may terminate the
Purchase Agreement if the acquisition does not occur on or before
June 30, 2005. If a required governmental or regulatory approval
has not been received by that date, however, then either party may
extend the closing to a date that is no later than August 31,
2005, or the date 25 days after which Ref-Fuel has provided to
Danielson certain financial statements.
$400-Mil Bond Offering to Finance Acquisition
Mr. Orlando explains that Danielson intends to finance the
transaction through a combination of debt and equity financing.
The equity component of the financing is expected to consist of a
$400 million offering of warrants or other rights to purchase
Danielson's common stock to all of Danielson's existing
stockholders at $6 per share.
Danielson's existing stockholders will be issued rights to
purchase in an offering to be registered with the Securities and
Exchange Commission, Danielson's stock on a pro rata basis. Each
holder will be entitled to purchase approximately 0.9 shares of
Danielson's common stock at an exercise price of $6 per full share
for each share of Danielson's common stock then held.
Danielson will file a registration statement with the SEC with
respect to those rights offering. Any offer or solicitation will
be made in compliance with all applicable securities laws.
Three of Danielson's largest stockholders, SZ Investments L.L.C.,
Third Avenue Business Trust, on behalf of Third Avenue Value Fund
Series, and D.E. Shaw Laminar Portfolios, L.L.C., representing
ownership of 40% of Danielson's outstanding common stock, have
committed to participate in the Ref-Fuel Rights Offering and
acquire their pro rata portion of the shares.
Debt financing from Goldman Sachs & CSFB
Danielson also received a commitment from Goldman Sachs Credit
Partners, L.P., and Credit Suisse First Boston for a debt-
financing package for Covanta, necessary to finance the
acquisition, as well as to refinance the existing recourse debt of
Covanta and provide additional liquidity for the Company. It is
currently expected that this financing will consist of two
tranches, each of which is secured by pledges of the stock of
Covanta's subsidiaries that has not otherwise been pledged,
guarantees from certain of Covanta's subsidiaries and all other of
its available assets.
The first tranche, a first priority senior secured bank facility,
will be made up of:
a $250 million term loan facility;
a $100 million revolving credit facility; and
a $340 million letter of credit facility.
The second tranche, a second priority senior secured term loan
facility, will consist of a $450 million term loan facility.
The closing of the financing and receipt of proceeds under the
Ref-Fuel Rights Offering are closing conditions under the
Purchase Agreement.
Ref-Fuel Will Be Assigned to Covanta
Immediately upon closing of the acquisition, Ref-Fuel will become
a wholly owned subsidiary of Covanta, and Covanta will control the
management and operations of the American Ref-Fuel facilities.
The current project and other debt of Ref-Fuel subsidiaries will
be unaffected by the acquisition, except that the revolving credit
and letter of credit facility of American Ref-Fuel Company LLC
will be cancelled and replaced with new facilities at the Covanta
level.
There can be no assurance that Danielson will be able to complete
the Ref-Fuel Rights Offering or complete the acquisition of Ref-
Fuel.
Risks in the Acquisition
Mr. Orlando acknowledges that achieving the anticipated benefits
of the transaction will depend in part on Covanta's ability to
integrate the two companies' businesses in an efficient and
effective manner. Covanta's attempt to integrate two companies
that have previously operated independently may result in
significant challenges. Covanta may be unable to accomplish the
integration smoothly or successfully.
The process of integrating operations after the transaction could
cause an interruption of, or loss of momentum in, the activities
of one or more of the combined company's businesses and the loss
of key personnel. Employee uncertainty and lack of focus during
the integration process may also disrupt the businesses of the
combined company. Any inability of management to integrate the
operations of Ref-Fuel and Danielson successfully could have a
material adverse effect on the business and financial condition of
Danielson.
If the proposed acquisition with Ref-Fuel closes, Covanta expects
that Danielson will be obligated to pay transaction fees and other
expenses related to the transaction of $45 million, including
financial advisors' fees, legal and accounting fees, and fees and
expenses to refinance the existing Covanta recourse debt.
Covanta also expects to incur significant costs, estimated at
$45 million, associated with combining the operations of the two
companies. However, Covanta cannot predict the specific size of
those charges before it begins the integration process. Although
Covanta expects that the elimination of duplicative costs, as well
as the realization of other efficiencies related to the
integration of the businesses, it cannot give any assurance that
this net benefit will be achieved as expected, or at all.
While Covanta and Ref-Fuel both sell energy pursuant to long-term
contracts, Covanta typically sells a greater proportion of its
aggregate waste processing capacity under long-term contracts than
does Ref-Fuel. Consequently, more of Ref-Fuel's revenue from its
waste-to-energy facilities is subject to market risk from
fluctuations in waste market prices than Covanta's, and short-term
fluctuations in the waste markets may have a greater impact on the
combined company's waste-to energy revenues than on those of
Covanta alone.
Danielson Gets Clearance
On March 21, 2005, Danielson received notification of early
termination of the waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976 with respect to its acquisition
of Ref-Fuel.
Headquartered in Fairfield, New Jersey, Covanta Energy Corporation
-- http://www.covantaenergy.com/-- is a publicly traded holding
company whose subsidiaries develop, own or operate power
generation facilities and water and wastewater facilities in the
United States and abroad. The Company filed for Chapter 11
protection on April 1, 2002 (Bankr. S.D.N.Y. Case No. 02-40826).
Deborah M. Buell, Esq., and James L. Bromley, Esq., at Cleary,
Gottlieb, Steen & Hamilton, represent the Debtors in their
restructuring efforts. When the Debtors filed for protection from
their creditors, they listed $3,280,378,000 in assets and
$3,031,462,000 in liabilities. On March 10, 2004, Covanta Energy
Corporation and its core subsidiaries emerged from chapter 11 as a
wholly owned subsidiary of Danielson Holding Corporation. Some of
Covanta's non-core subsidiaries have liquidated under separate
chapter 11 plans. (Covanta Bankruptcy News, Issue No. 76;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
CREDIT SUISSE: Fitch Rates $9,775,000 Home Equity Certs. at BB+
---------------------------------------------------------------
Fitch rates Credit Suisse First Boston -- CSFB -- series 2005-2
home equity pass-through certificates:
-- $947,025,050 classes 1-A-1, 1-A-2, 2-A-1, 2-A-2, 2-A-3, A-
IO-1, A-IO-2, class R, and class R-II 'AAA';
-- $38,525,000 class M-1 'AA+';
-- $35,075,000 class M-2 'AA';
-- $24,150,000 class M-3 'AA-';
-- $20,125,000 class M-4 'A+';
-- $20,125,000 class M-5 'A';
-- $16,100,000 class M-6 'A-';
-- $16,100,000 class B-1 'BBB+';
-- $14,375,000 class B-2 'BBB';
-- $8,625,000 class B-3 'BBB-';
-- $9,775,000 class B-4 'BB+'.
The 'AAA' rating on the senior certificates reflects the 19% total
credit enhancement provided by:
* the 3.35% class M-1,
* the 3.05% class M-2,
* the 2.10% class M-3,
* the 1.75% class M-4,
* the 1.75% class M-5,
* the 1.40% class M-6,
* the 1.40% class B-1,
* the 1.25% class B-2,
* the 0.75% class B-3,
* the 0.85% class B-4, and
* the 1.35% target overcollateralization -- OC.
All certificates have the benefit of monthly excess cash flow to
absorb losses. In addition, the ratings reflect the quality of
the loans, the integrity of the transaction's legal structure, as
well as the primary servicing capabilities of Wells Fargo Bank,
N.A. (50.4%) and Select Portfolio Servicing, Inc. (49.6%).
U.S. Bank National Association will act as Trustee.
The mortgage pool consists of first- and second-lien fixed-rate
subprime mortgage loans with an initial aggregate principal
balance of $1,029,645,330. On the closing date, the depositor
will deposit approximately $120,354,720 into a pre-funding
account. The amount in this account will be used to purchase
subsequent mortgage loans after the closing date and on or prior
to June 24, 2005.
The Group 1 loans have an initial aggregate principal balance of
$694,328,244. As of the cut-off date, the weighted average loan
rate is approximately 7.11% and the weighted average FICO is 627.
The weighted average remaining term to maturity -- WAM -- is 354
months. The average cut-off date principal balance of the
mortgage loans is approximately $146,806. The weighted average
original loan-to-value ratio -- OLTV -- is 80.1%. The properties
are primarily located in:
* California (23.4%),
* Florida (12.3%) and
* New York (5.3%).
The Group 2 loans have an initial aggregate principal balance of
$335,317,086. As of the cut-off date, the weighted average loan
rate is approximately 7.09% and the weighted average FICO is 629.
The WAM is 355 months. The average cut-off date principal balance
of the mortgage loans is approximately $203,393. The weighted
average OLTV is 80.5%. The properties are primarily located in:
* California (32.0%),
* Florida (10.9%) and
* Georgia (6.7%).
All of the mortgage loans were purchased by an affiliate of the
depositor from various sellers in secondary market transactions.
For federal income tax purposes, an election will be made to treat
the trust as multiple real estate mortgage investment conduits.
DIRECTV GROUP: Moody's Assigns Ba1 Rating to New $2.5 Billion Loan
------------------------------------------------------------------
Moody's Investors Service assigned a Ba1 rating to the new
$2.5 billion senior secured credit facilities for DIRECTV Holdings
LLC (DIRECTV), the 100% owned subsidiary of The DIRECTV Group,
Inc. (DTVG). Moody's also affirmed all of DIRECTV's existing debt
ratings.
The DIRECTV debt ratings that are affected include:
Newly assigned ratings:
* $2.0 billion of senior secured term loans at Ba1;
* $500 million senior secured revolver (currently undrawn)
at Ba1.
Affirmed ratings:
* Senior implied rating at Ba2;
* $1.40 billion senior unsecured notes at Ba2;
Issuer rating at Ba3.
The outlook remains stable.
DIRECTV plans to issue $2.5 billion in credit facilities that will
be guaranteed by all of DIRECTV's existing and certain future
domestic subsidiaries on a senior secured basis. The borrowings
under the new credit facilities, will be used to refinance
existing senior credit facilities and to repay DIRECTV's
intercompany note of $875 million owed to DTVG. The company is
also planning to repay about $490 million of its Ba2 rated senior
unsecured notes with equity being down-streamed from DTVG.
DIRECTV will benefit from a slightly improved liquidity profile as
a result of the new debt issuance. The new facilities include an
increased revolver by $250 million and slightly loosened financial
covenants. The total amount of debt outstanding at DIRECTV was
decreased as well from approximately $3.3 billion to $2.9 billion,
excluding the impact of net accounts payable obligations (net of
receivables) of about $900 million. We don't expect the company
to draw down on the revolver at the closing of the transaction.
Moody's will withdraw the ratings for the existing credit
facilities once the new ones are closed.
The newly assigned ratings reflect the new bank debt that is
secured by substantially all of the domestic assets of DIRECTV and
enjoys a guarantee from all of DIRECTV's operating subsidiaries.
Moody's believes that the asset base making up the secured
collateral is of advantage to the secured credit facilities, which
is the reason for the higher notching above the senior implied and
senior unsecured creditors (notes and accounts payable).
Likewise, the existing senior unsecured notes, which enjoy only a
senior unsecured guarantee from all domestic operating
subsidiaries of DIRECTV are effectively subordinated to the
secured bank debt asset collateral and are therefore rated one
notch lower at the senior implied Ba2 level. The evidence of
operating company guarantees for the secured and senior unsecured
debt results in the single-notched down to the Ba3 level for the
Issuer Rating as Issuer Ratings represent senior-unsecured and un-
guaranteed obligations.
However, Moody's notes that post refinancing, the senior unsecured
notes, which account for about 25% of the debt capital structure,
and which together with the net accounts payables will be a part
of a smaller pool of unsecured creditors due to the planned
$490 million debt repayment, will be in a worse position given the
refinancing of the senior unsecured $875 million of inter-company
debt (that ranked pari passu with the senior unsecured notes) with
mostly secured bank debt.
The ratings reflect the moderate debt leverage and credit metrics
of the consolidated company and particularly strong balance sheet
when DTVG's cash is considered (though DTVG does not guarantee
DIRECTV's debt), which are generally stronger than metrics in the
media industry Ba-rating category.
However, Moody's remains concerned given our expectation of an
increasing competitive environment facing the company in the
intermediate to long-term period as RBOCs begin selling video
programming to their existing customers and cable companies
aggressively defend their subscriber base with three or four-
service bundled offerings. Although Moody's expect most of the
RBOCs to initially focus on the urban and sub-urban areas of their
existing footprints and on the more affluent segments of the
market which represents only a portion of DIRECTV's footprint,
nevertheless the inability of DIRECTV to provide its own multi-
bundled product leaves it susceptible to churn increases,
subscriber erosion, ARPU decreases, and significant increases in
SAC and subscriber retention expenses which have been factored
into the rating.
Moody's expect retention costs to more than double over the
intermediate-term period, continuing the rising trend from 2003 to
2004. Moody's concerns over the competitive disadvantages of the
pay-TV satellite industry, and the ability of the company to
defend its subscriber base from this competitive threat or a
material decline in its operating margins from price competition
and increased expenses, constrain further credit ratings
improvement.
The stable rating outlook incorporates Moody's expectation that
over the intermediate-term DIRECTV will experience continued
subscriber growth, offset by moderate growing annual SAC costs per
sub, continued rapid increases in subscriber retention expenses,
and higher churn rates. Moody's expect DIRECTV to finish this
year and next year at or near free-cash-flow break even with
improving prospects for 2007.
DIRECTV has approximately $2.9 billion of debt outstanding
including the impact of the new debt issuances and the repayment
of a portion of the senior unsecured notes and the inter-company
notes to DTVG as part of the overall refinancing plan. Moody's
expect total debt for DIRECTV to equal slightly under 2.5 times
EBITDA by year-end 2005 and just under 2.0 times EBITDA by year-
end 2007, comfortably within the company's existing covenants.
Moreover, total debt-to-free cash flow should be under 15 times by
year-end 2007. The ratings also reflect historically
unpredictable operating performance, an intense level of
competition - currently with Echostar and the well entrenched
cable companies, as well as increasingly with the RBOCs -- and
escalating programming costs. As an important part of News
Corp.'s global satellite strategy, DTVG may strive for near-term
scale at the expense of free cash flow generation.
The DIRECTV Group, Inc. formerly Hughes Electronics Corporation,
headquartered in El Segundo, California, is a world-leading
provider of multi-channel television entertainment, and broadband
satellite networks and services. The DIRECTV Group, Inc. with
sales in 2004 of approximately $11.4 billion is 34% owned by Fox
Entertainment Group, Inc., which is owned by News Corporation.
EVOLVED DIGITAL: Dec. 31 Balance Sheet Upside-Down by $722,172
--------------------------------------------------------------
Evolved Digital Systems Inc. (TSX: EVD), disclosed its results for
the fourth quarter and the year ended December 31, 2004.
"Compared to several years ago when we were one of the 'pioneers'
focusing on the mainstream hospital market, the rate of adoption
of our target of midsize hospitals and clinics to fully digital
imaging is now growing rapidly" stated Evolved Chairman, Richard
J. Eskind. "We are making steady progress in positioning the
Company for long term success. The financial impact of our
operations streamlining process that we executed in 2004, combined
with capturing our share of this new market growth, should result
in additional improvements in performance throughout 2005 and
beyond."
Revenues for the year ended December 31, 2004 totaled
$16.4 million, up $4.3 million and 35% compared to revenues of
$12.2 million for 2003. The increase in revenues for the year
ended December 31, 2004 is a result of growth in customer volume
for the combined Company during 2004 and the addition of
cardiology-related revenues as of October 15, 2003.
Loss from operations for 2004 was $9.8 million compared to a loss
of $26.8 million for 2003. The reduction in the loss from
operations from the prior year is partially attributed to
increased operating efficiencies resulting from the consolidation
of operations of the former Electromed and INPHACT but also
includes a number of one time, non-recurring items. These include
$1.3 million of restructuring charges in 2004 primarily related to
the closure of its operations in France and severance costs for
several employees versus $0.3 million of restructuring charges in
2003. The loss from operations for 2004 also includes a gain on
settlement of a contract of $2.0 million. Included in the loss
for 2003 was impairment on capitalized software expenses of
$4.4 million.
Net loss for 2004 was $9.9 million, or $0.18 per share, versus a
net loss of $86.2 million for 2003, or $6.58 per share. The net
loss for 2003 included $59.9 million of non-recurring charges
relating primarily to the impairment of goodwill related to the
acquisition of Electromed and non-cash accrued interest expenses
on INPHACT securities converted during the business combination.
On February 18, 2005, the Company announced the completion of an
equity and debt financing package of up to $8,200,000, which as a
subsequent event, is not reflected in the December 31, 2004
financial statements.
With over 100 customer locations across North America, Evolved
Digital Systems, Inc., is a healthcare technology solutions
company. Its services and enabling technologies transform
hospital and clinic imaging departments from manual to
digital- based systems, improving efficiency, turnaround time, and
patient care. Evolved is a publicly traded company listed on the
Toronto Stock Exchange. Corporate headquarters are based in
Laval, Quebec. U.S. offices are located in Brentwood, Tennessee.
Evolved Digital's September 30, 2004, financial statements express
significant doubt about the company's ability to continue as a
going concern, noting that the Company has incurred significant
operating losses, negative operating cash flows, and that the
Company is dependent on additional financing or capital to fund
its future operations.
As of December 31, 2004, Evolved Digital had a $722,172 equity
deficit compared to a $9,316,872 positive equity at December 31,
2003.
DONNKENNY: Gets Final Approval for $60 Mil. DIP Facility From CIT
-----------------------------------------------------------------
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York issued a final order authorizing
Donnkenny Inc. and its debtor-affiliates to obtain up to $60
million of postpetition financing from CIT Group/Commercial
Services, Inc.
The Company expects that the DIP Agreement will allow the Company
to finance its working capital needs and allow business operations
to continue as normal during the sales process, including meeting
obligations to employees, vendors and other suppliers of goods and
services.
CIT is granted valid and perfected first priority liens on the
Debtors' assets to secure repayment of all post-petition
borrowings.
Headquartered in New York City, Donnkenny, Inc., and its debtor-
affiliates design, import, and market broad lines of moderately
and better priced women's clothing. The Debtors filed for chapter
11 protection on Feb. 7, 2005 (Bankr. S.D.N.Y. Case No. 05-10712
through 05-10716). Bonnie Steingart, Esq., Kalman Ochs, Esq., and
Christopher R. Bryant, Esq., at Fried, Frank, Harris, Shriver &
Jacobson LLP, represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they listed $45,670,000 in total assets and
$100,100,000 in total debts.
FASSBERG CONSTRUCTION: Voluntary Chapter 11 Case Summary
--------------------------------------------------------
Debtor: Fassberg Construction Company
17000 Ventura Boulevard, Suite 200
Encino, California 91316
Bankruptcy Case No.: 05-11957
Chapter 11 Petition Date: April 1, 2005
Court: Central District of California (San Fernando Valley)
Judge: Geraldine Mund
Debtor's Counsel: Douglas M. Neistat, Esq.
16000 Ventura Blvd #1000
Encino, California 91436
Tel: (818) 382-6200
The Debtor did not file a list of its 20 Largest Unsecured
Creditors.
FEDERAL INFORMATION: S&P Rates Proposed $90M Sec. Facility at B+
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to Federal Information Technology Systems LLC. At
the same time, Standard & Poor's assigned its 'B+' bank loan
rating and '3' recovery rating to the company's proposed $90
million secured credit facility, indicating the likelihood of a
meaningful recovery of principal in the event of a payment
default. The outlook is stable.
Morristown, New Jersey-based Federal IT acquired unrated Sensor
Systems Inc. on April 1, 2005, for $117 million. The proceeds
from the new credit facility, $33.5 million of new equity from its
equity sponsors, $14 million of rollover equity from Sensor's
existing management, and cash on hand, will be used to finance the
purchase, repay $10 million of Federal IT debt, and pay fees and
expenses. Kelso & Co., a private equity firm controls Federal IT.
"The ratings on Federal IT reflect a modest scale of operations,
limited product and program diversity, competitors that are much
larger, and the likelihood of debt-financed acquisitions," said
Standard & Poor's credit analyst Christopher DeNicolo. "These
factors are offset somewhat by leading positions in niche markets
for intelligence analysis tools and high operating margins."
Federal IT is a leading developer of intelligence analysis
software tools for the intelligence community and the U.S.
military. Following the transaction, the company will be
comprised of two units, Austin Info Systems (AIS, 57% of pro form
revenues) and Sensor (43%, but a much larger portion of
earnings and cash flow).
The proposed facility consists of a $10 million six-year revolving
credit facility and an $80 million six-year term loan. The
borrowers are AIS Acquisition Corp. (a holding company) and Sensor
Systems Inc. (an operating company), both of which are direct
subsidiaries of Federal IT. Federal IT and each of its direct and
indirect present and future subsidiaries, except the borrowers,
guarantee the facility. Collateral is provided by a perfected
first-priority security interest in substantially all of the
tangible and intangible assets of the guarantors and borrowers,
100% of the capital stock of direct and indirect domestic
subsidiaries, and 65% of the capital stock of foreign
subsidiaries.
The term loan will amortize 0.25% a quarter for the first five
years, with the balance paid in four equal quarterly installments
in year six. Mandatory prepayments include a 50% excess cash flow
sweep. The proceeds, in combination with equity sponsor cash and
cash on hand, will be used to finance the acquisition of Sensor,
refinance existing debt at Federal IT and pay related fees and
expenses.
FERRELLGAS PARTNERS: Fitch Downgrades $271 Mil. Sr. Notes to B+
---------------------------------------------------------------
Fitch Ratings has downgraded the ratings of Ferrellgas Partners,
L.P.'s -- FGP -- outstanding $271 million senior notes to 'B+'
from 'BB' and Ferrellgas, L.P.'s -- FGLP -- outstanding $783
million senior unsecured notes and $307.5 million bank credit
facility to 'BB' from 'BBB-'. The Rating Outlook for both
companies is revised to Stable from Negative.
The ratings downgrade of both FGP and FGLP reflects reduced
profitability and continued weak debt leverage and interest
coverage metrics. The high and volatile commodity price
environment has presented continued challenges to both FGP's base
retail distribution business, as well as Blue Rhino Corp.'s
propane cylinder exchange operations. This commodity price
environment has resulted in lower profit margins, elevated
customer conservation, and higher working capital borrowings.
While propane prices are down from their peak levels earlier this
winter, the prospect of an extended period of high propane prices
is likely to negatively impact FGP's financial performance. The
'B+' senior unsecured rating of FGP also reflects the structural
subordination of its debt obligations to approximately $862
million of unsecured debt at FGLP.
Financial performance has also been affected by warmer than normal
weather over the past two heating seasons. Volumes delivered by
FGP's retail propane distribution operations are inherently
sensitive to prevailing weather conditions. This warmer weather,
combined with high commodity prices, resulted in reduced customer
demand for propane. RINO's operations have not yet exhibited the
earnings growth that FGP anticipated when the acquisition was
completed in late April 2004. For the 12-month period ended Jan.
31, 2005, FGP's unadjusted debt to EBITDA and EBITDA to interest
expense equaled 6.4 times and 2.0x, respectively; these same
unadjusted ratios for FGLP were 4.9x and 2.8x, respectively, for
the period. These ratios do not incorporate pro forma adjustments
to include a full year of RINO or other acquisitions completed
during the past twelve months.
The Stable Outlook reflects the expectation that credit ratios are
not likely to deteriorate beyond current levels in the near term
and that FGLP should also be able to meet its $109 million August
2005 debt maturity through sales of nonstrategic assets, new
equity, or a combination of both. The benefits from the full
rollout of FGP's new operating system, which is expected by the
end of 2005, remain uncertain. FGP management expects to realize
significant cost savings from reduced headcount and improved
efficiencies as a result of this new platform. However, the
companywide rollout of this operating system introduces
implementation risks. If the system is able to generate improved
margins, cash flow improves, and debt is further reduced, a
positive rating action could result.
FUTRONIX INC: Case Summary & 29 Largest Unsecured Creditors
-----------------------------------------------------------
Lead Debtor: Futronix, Inc.
1760 S Dimensions Ter
Homosassa, Florida 34448
Bankruptcy Case No.: 05-06329
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Futronix Group, Inc. 05-06331
Type of Business: The Debtor does business as an electronic
manufacturing service. The Debtor manufactures
consigned & turnkey production, helps with
circuit design, assembly, fabrication and
produces Printed Circuit Boards(PCB's).
See http://www.futronixinc.com/
Chapter 11 Petition Date: April 5, 2005
Court: Middle District of Florida (Tampa)
Debtor's Counsel: Alberto F. Gomez, Jr., Esq.
Morse & Gomez, PA
119 S. Dakota Avenue
Tampa, Florida 33606
Tel: (813) 301-1000
Estimated Assets Estimated Debts
---------------- ---------------
Futronix, Inc. $1 Million to $1 Million to
$10 Million $10 Million
Futronix Group, Inc. Unknown $100,000 to
$500,000 to
A. Futronix, Inc.'s 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Arrow Electronic, Inc. $161,099
c/o Jacobson Sobo
PO Box 19359
Plantation, FL 33318
Atlantic American Capita $160,870
101 E Kennedy Blvd
Suite 3300
Tampa, FL 33602
FAI Electronics Corp. $94,204
Dept. 3273
135 S. La Salle St.
Chicago, IL 60674
Internal Revenue Service $85,078
Spec Procedures/Insolven
Bush Ross, et al. $50,929
PMI (USA) Co. $42,854
Del Rey Beach Prop LLC $37,822
Qualitek Electronics Co $34,723
State of FLorida $34,700
Dept. of Revenue
GE Capital Lease $27,431
Falco Electronics $27,090
RF Micros Devices $19,825
State of FLorida $18,950
Dept. of Revenue
Pioneer Standard Electro $17,048
Burgess, harell et al. $13,278
FWCJUA $12,640
Elreha Printed Circuits $12,567
Alpine Electronics Inc. $9,804
JST Corporation $9,624
Foresight Technologies $8,719
B. Futronix Group, Inc.'s 9 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Doug Jones $50,000
5254 Kirkwood Ave
Spring Hill, FL 34608
Don Shearin $30,000
605 Hillrise Blvd
Johnson City, TN 37601
Charles W. Brown $20,000
1685 Simpson Dr
PO Box 27370
Columbus, OH 43227
Millie Henderson $20,000
605 Hillrise Blvd
Johnson City
Howard and/or Linda Park $10,000
Dan and/or Janet Attwood $10,000
William Schumate $10,000
George A Baily $6,000
Karl A or Betty G Smith $5,000
HAMPTON COURT: ASC Alleges Illegal Securities Trading
-----------------------------------------------------
Staff of the Alberta Securities Commission will hold a hearing
into allegations that Calgary-based Hampton Court Resources, under
the direction of its President Robert Andrew MacPherson, engaged
in illegal trades and distributions of its securities. In its
Notice of Hearing, ASC staff alleged that Hampton Court Resources
illegally raised over $4.1 million from approximately 147 Alberta
investors. Mr. MacPherson, William Blair Buzan and Robert John
Sellars, are alleged to have been promoters of the securities and
were not registered to trade in securities or exempt from
registration.
A copy of the Notice of Hearing outlining the allegations in their
entirety is available on the ASC website at:
http://www.albertasecurities.com/
The ASC is the industry-funded regulatory agency responsible for
administering the Alberta Securities Act. Its mission is to
foster a fair and efficient capital market in Alberta and,
together with the other members of the CSA, develop and operate
the Canadian securities regulatory system.
Hampton Court Resources Inc. and its wholly owned subsidiaries
Hampton Court Resources Corp. and the consolidated accounts of
Azuma Gold Corp. The Corporation is engaged in the exploration
for and production of oil and natural gas in Western Canada.
In its latest set of published financial statements, Hampton Court
Resources Inc. reported a $13,207,684 equity deficit at Sept. 30,
2003, compared to a $10,449,413 equity deficit at Dec. 31, 2002.
The Company reported an accumulated deficit of approximately
$23,000,000 and an approximate $25,000,000 working capital
deficiency at September 30, 2003.
The Company is in default on its term loans and its unsecured
refined gold loans totaling $15,024,223. Negotiations are ongoing
with the loan holders to convert these obligations into some form
of royalty on production from the mineral properties. In the event
that the Company is unsuccessful in its efforts to renegotiate the
terms of the loans, the holders of the loans, in addition to other
creditors of the Company, could force the Company into
receivership or bankruptcy.
HINES HORTICULTURE: S&P Revises Outlook to Negative
---------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Irvine,
California-based Hines Horticulture Inc. to negative from stable.
Existing ratings on the company, including the 'B+' corporate
credit rating, were affirmed. The company has $233 million in
total debt.
The outlook revision reflects Standard & Poor's concerns about
changing business trends that may further pressure the company's
softer-than-expected operating performance. "A further decline in
EBITDA may lead to weaker covenant cushion as leverage covenants
tighten in 2005 and 2006. Specifically, Hines could encounter
business interruptions from a pay-by-scan rollout with its largest
customer, Home Depot, and upcoming facility moves. In addition,
the company is increasingly dependent on mass merchant and home
center customers, and subject to pricing pressure due to nursery
and garden retailer liquidations and industry overcapacity," said
Standard & Poor's credit analyst Alison Birch.
Sales and EBITDA dropped by 2.0% and 10.5%, respectively, compared
with fiscal 2003. These declines were due to an inability to
recover from a weak spring season, which was primarily caused by a
customer realignment plan and four hurricanes in the Southeast.
HOLLINGER INC: No Relief from Regulator's Cease Trade Orders
------------------------------------------------------------
Ontario Securities Commission held hearings On March 21, 23
and 24, 2005, to consider an application by Hollinger Inc., Conrad
Black, The Ravelston Corporation Limited and various other
entities related to Black and Ravelston to vary the management
cease trade order orders currently in effect in respect of the
Company and Hollinger Inc. The purpose of the application was to
enable a proposed going private transaction in respect of
Hollinger International Inc. and Hollinger Inc. sponsored by Black
and Ravelston to proceed. The Company was granted standing to
appear at the OSC hearing in its capacity as an interested party
opposed to the grant of the requested relief on a number of
grounds. The OSC declined to grant the variations to the
management cease trade orders being requested by Ravelston and
Black on the basis that, in the circumstances, the OSC could not
conclude that it would not be prejudicial to the public interest
to grant the relief.
As a result of the OSC decision denying the application, Hollinger
Inc. cancelled its shareholders meeting scheduled for March 31,
2005, to vote on the going private transaction.
Hollinger's principal asset is its interest in Hollinger
International which is a newspaper publisher, the assets of which
include the Chicago Sun-Times, a large number of community
newspapers in the Chicago area and a portfolio of news media
investments, and a portfolio of revenue-producing and other
commercial real estate in Canada, including its head office
building located at 10 Toronto Street, Toronto, Ontario.
* * *
As reported in the Troubled Company Reporter on August 31, 2004,
as a result of the delay in the filing of Hollinger's 2003 Form
20-F (which would include its 2003 audited annual financial
statements) with the United States Securities and Exchange
Commission by June 30, 2004, Hollinger is not in compliance with
its obligation to deliver to relevant parties its filings under
the indenture governing its senior secured notes due 2011.
Approximately $78 million principal amount of Notes is outstanding
under the Indenture. On August 19, 2004, Hollinger received a
Notice of Event of Default from the trustee under the Indenture
notifying Hollinger that an event of default has occurred under
the Indenture. As a result, pursuant to the terms of the
Indenture, the trustee under the Indenture or the holders of at
least 25 percent of the outstanding principal amount of the Notes
will have the right to accelerate the maturity of the Notes.
Approximately $5 million in interest on the Notes was due on
September 1, 2004. Hollinger has deposited the full amount of the
interest payment with the trustee under the Indenture and
noteholders will receive their interest payment in a timely
manner.
There was in excess of $267.4 million aggregate collateral
securing the $78 million principal amount of the Notes
outstanding.
Hollinger also received notice from the staff of the Midwest
Regional Office of the U.S. Securities and Exchange Commission
that they intend to recommend to the Commission that it authorize
civil injunctive proceedings against Hollinger for certain alleged
violations of the U.S. Securities Exchange Act of 1934 and the
Rules thereunder. The notice includes an offer to Hollinger to
make a "Wells Submission", which Hollinger will be making, setting
forth the reasons why it believes the injunctive action should not
be brought. A similar notice has been sent to some of Hollinger's
directors and officers.
INTERSTATE BAKERIES: Wants to Walk Away from 6 Real Estate Leases
-----------------------------------------------------------------
Interstate Bakeries Corporation and its debtor-affiliates seek
authority from the U.S. Bankruptcy Court for the Western District
of Missouri to reject Real Property Leases for six locations,
effective as of the Rejection Date applicable to each Real
Property Lease, to reduce postpetition administrative costs.
The Debtors intend to reject five Real Property Leases effective
as of April 20, 2005:
Lessor Address of Leased Premises Lease Date
------ -------------------------- ----------
Santa Clara Street 72 West Santa Clara Street, 02/10/1958
Urban Renewal Ventura, California
Properties LLC
Roger Development, 392 Harrison Street, 12/22/1975
Inc. Batesville, Arizona
Yelvington Land 2009 South Division Ave., 06/11/1996
Company Orlando, Florida
Fallstar 1050 Main Street, Holly 07/01/2000
Associates, LLC Springs, North Carolina
X-TRA Space Self 14720 South Stagecoach 10/21/2002
Storage Trail Cordes, Junction,
Arizona
The Debtors also want to reject an October 19, 1988, Real
Property Lease with respect to a property owned by Childers
Realty at 4100 First Avenue in Nitro, West Virginia, effective as
of March 31, 2005.
According to J. Eric Ivester, Esq., at Skadden Arps Slate Meagher
& Flom LLP, in Chicago, Illinois, the resultant savings from the
rejection of the Real Property Leases will favorably affect the
Debtors' cash flow and assist the Debtors in managing their
future operations.
Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh baked
bread and sweet goods, under various national brand names,
including Wonder(R), Hostess(R), Dolly Madison(R), Baker's Inn(R),
Merita(R) and Drake's(R). The Company employs approximately
32,000 in 54 bakeries, more than 1,000 distribution centers and
1,200 thrift stores throughout the U.S.
The Company and seven of its debtor-affiliates filed for chapter
11 protection on September 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6.0% senior subordinated convertible notes due August 15, 2014,
on August 12, 2004) in total debts. (Interstate Bakeries
Bankruptcy News, Issue No. 16; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
INVERNESS MEDICAL: Weak Performance Prompts S&P to Lower Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
Inverness Medical Innovations Inc., including the corporate credit
rating to 'B' from 'B+'.
The outlook is stable. Waltham, Mass.-based Inverness is a
supplier of diagnostic tests. Total rated debt is $150 million.
"These actions reflect Inverness' seeming inability to translate
its business development and operating initiatives into
sustainable cash flow. Despite successful new product launches
and efforts to improve manufacturing, credit measures are still
very weak," said Standard & Poor's credit analyst David Lugg.
Moreover, Standard & Poor's had expected that free cash flow would
be somewhat positive for 2004, but instead the company consumed
about $12 million. Reasons for this disappointing performance
include delays in moving some manufacturing operations to China,
weakness in the company's consumer nutritional business and
ongoing litigation expenses in defense of its intellectual
property.
The rating anticipates continued debt-financed acquisitions and
modest improvements in operating cash flow. It is expected that
significant improvements in cash generation will likely be longer-
term achievements while ongoing acquisition activity will continue
to depress credit measures.
IPIX CORP: Auditors Express Doubt About Going Concern Viability
---------------------------------------------------------------
IPIX Corporation (NASDAQ:IPIX), a premier supplier of 360-degree,
immersive imaging technologies for visual intelligence
applications, reported financial results for the quarter and year
ended December 31, 2004 and comparable year-ago results:
4th Quarter Year
2003 2004 2003 2004
-------- -------- -------- --------
Revenue $499 $909 $2,594 $3,864
Operating expenses $2,866 $3,601 $8,856 $11,030
Loss from continuing ops after
income taxes ($1,801) ($3,678) ($4,670) ($9,810)
Income (loss) from continuing ops
after income taxes $2,330 ($1,023) $6,056 ($4,925)
Net income (loss) per common share $0.01 ($0.22) ($0.05) ($0.95)
Year to year comparisons:
-- Total revenue for 2004 was $3.9 million compared to
$2.6 million in 2003
-- Security revenue for 2004 was $1.6 million compared to $0.3
million in 2003
-- Net loss from continuing operations after taxes was $9.8
million compared to $4.7 million in 2003; and
-- Basic net loss per share was $0.95 compared to $0.05.
IPIX completed its fourth quarter and year end with the
commencement of the sale of its AdMission business unit. The
sale--completed February 11, 2005--is reported as discontinued
operations in 2004 (and prior years) to reflect our current
business structure. The sale of the AdMission business unit
corresponded with our strategic plan for streamlining operations
and focusing on the further development and expansion of our
patented, immersive imaging technologies for security and
commercial applications.
2004 marked the launch of IPIX's award-winning line of 360-degree,
immersive surveillance cameras which were selected for use at the
2004 G8 Summit, as well as the 2005 U.S. Presidential
Inauguration. IPIX dedicated considerable resources during 2004
on this product launch, marketplace penetration, and continued
research and development. The Company's entry into this market is
marked by rising sales, the establishment of numerous strategic
business alliances and expansion of its distribution channels both
domestically and internationally. IPIX is positioned to
capitalize on these efforts moving forward.
At December 31, 2004, the company had $14.9 million in cash,
investments, short term and long term restricted cash and
$15.2 million in stockholders' equity.
"The substantial developments, strategic partnerships and product
awareness created in 2004 clearly mark the direction we are
headed," said IPIX President and CEO Clara Conti. "I am confident
in our organization's ability to continue to achieve our strategic
business objectives in 2005."
During the past 12 months, IPIX identified market opportunities
and generated interest from federal, state and local governments
and various commercial enterprises. Commercial markets include
transportation, banking, retail, public venues, educational
institutions and critical infrastructure. In addition, IPIX
established sales channels throughout Europe (including Russia),
the Middle East, and the Pacific Rim (including Australia).
"We enter 2005 with a definitive plan for our business," said Ms.
Conti. "We have made a commitment to recruiting talented and
dedicated professionals at all levels of our organization (to join
our existing group) as we continually work to expand our platform
of industry-leading, immersive imaging technologies."
Going Concern Doubt
In its Form 10-K for the year ended Dec. 31, 2004, filed with the
Securities and Exchange Commission, IPIX Corporation's auditors
included a going concern opinion in the Company's financial
statements. During the year ended December 31, 2004, and in the
prior fiscal years, the Company has experienced, and continues to
experience, certain issues related to cash flow and profitability.
These factors raise substantial doubt about the Company's ability
to continue as a going concern. The Company believes that it can
generate sufficient cash flow to fund its operations through the
launch and sale of new products in 2005 in the two continuing
business units of the Company. In addition, management will
monitor the Company's cash position carefully and evaluate its
future operating cash requirements with respect to its strategy,
business objectives and performance. Management will focus on
operating costs in relation to revenue generated.
About the Company
IPIX Corporation -- http://www.ipix.com/-- is a premium provider
of immersive imaging products for government and commercial
applications. The Company combine experience, patented technology
and strategic partnerships to deliver visual intelligence
solutions worldwide. The Company's immersive, 360-degree imaging
technology has been used to create high-resolution digital still
photography and video products for surveillance, visual
documentation and forensic analysis.
ISTAR FINANCIAL: Hosting First Quarter Webcast on April 26
----------------------------------------------------------
iStar Financial Inc. (NYSE: SFI), the leading publicly traded
finance company focused on the commercial real estate industry,
will release its financial results for the first fiscal quarter
ended March 31, 2005, on Tuesday, April 26, 2005, prior to the
opening of the market.
The company will host an earnings conference call reviewing these
results and its operations beginning at 10:00 a.m. ET. This
conference call will be broadcast live over the Internet and can
be accessed by all interested parties through iStar Financial's
Web site -- http://www.istarfinancial.com/-- in the "investor
relations" section. To listen to the live call, go to the
company's "investor relations" section of the website at least 15
minutes prior to the start of the call to register and download
any necessary audio software. For those who are not able to
listen to the live broadcast, a replay will be available shortly
after the call on the iStar Financial website.
About the Company
iStar Financial is the leading publicly traded finance company
focused on the commercial real estate industry. The Company
provides custom-tailored financing to high-end private and
corporate owners of real estate nationwide, including senior and
junior mortgage debt, senior and mezzanine corporate capital, and
corporate net lease financing. The Company, which is taxed as a
real estate investment trust, seeks to deliver a strong dividend
and superior risk-adjusted returns on equity to shareholders by
providing the highest quality financing solutions to its
customers. Additional information on iStar Financial is available
on the Company's website at http://www.istarfinancial.com/
* * *
As reported in the Troubled Company Reporter on Jan. 24, 2005,
iStar Financial, Inc., plans to acquire Falcon Financial
Investment Trust. Fitch expects no change to iStar's rating and
Outlook as a result of this transaction. The iStar's ratings are:
-- Senior unsecured debt: 'BBB-';
-- Preferred stock 'BB';
-- Rating Outlook Stable.
IWO HOLDINGS: Court Issues Final Decree Closing Bankruptcy Cases
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware entered a
final decree formally closing the chapter 11 cases of IWO
Holdings, Inc., and its debtor-affiliates.
The Court is satisfied that:
* the Debtors have consummated their confirmed Joint Plan of
Reorganization;
* the Debtors' estates have been fully administered;
* all distributions required have been made pursuant to the
terms of the Plan; and
* there are no adversary cases pending.
Headquartered in Lake Charles, Louisiana, IWO Holdings, Inc.,
-- http://iwocorp.com/-- through its Independent Wireless One
Corporation subsidiary, is a PCS affiliate of Sprint PCS. IWO
Holdings provides mobile digital wireless personal communications
services, or PCS, under the Sprint and Sprint PCS brand names in
upstate New York, New Hampshire (other than Nashua market),
Vermont and portions of Massachusetts and Pennsylvania. The
Debtors filed for chapter 11 protection on January 4, 2005 (Bankr.
D. Del. Case Nos. 05-10009 to 05-10011). When the Debtors sought
bankruptcy protection, they reported assets amounting to
$246,921,000 and debts amounting to $413,275,000.
KEYSTONE CONSOLIDATED: Wants Until Sept. 15 to Solicit Acceptances
------------------------------------------------------------------
Keystone Consolidated Industries, Inc., and its debtor-affiliates
ask the U.S. Bankruptcy Court for the Eastern District of
Wisconsin to extend, until Sept. 15, 2005, the period within which
they have the exclusive right to solicit acceptances of their
Joint Plan of Reorganization from creditors.
The Debtors' request for an extension of their exclusive
solicitation period includes a limited exception for a Proposing
Party, as defined in the Lock-Up Agreement, to file and solicit
acceptances to a Qualified Alternative Plan.
The Debtors filed their Disclosure Statement and Joint Plan on
Oct. 4, 2005. On March 21, 2005, the Debtors executed a Lock-Up
Agreement with the Independent Steel Worker's Alliance, the
Affected Retirees, the Official Committee of Unsecured Creditors
and Contran Corporation, which provides a blueprint for the
Debtors' emergence from their chapter 11 cases.
The Debtors are in the process of negotiating and preparing a
consensual Plan that will include the provisions of the Lock-Up
Agreement.
The Debtors give the Court four reasons militating in favor of
their request to extend their exclusive solicitation period:
a) the size and complexity of the their chapter 11 cases,
including the development of a business plan, negotiations
with various labor groups and retiree groups and the
Creditors Committee;
b) the existence of good faith progress towards reorganization
as evidenced by the execution of the Lock-Up Agreement,
preparing and sharing a business plan acceptable to
creditors and providing substantial financial and non-
financial information to those creditors;
c) the Debtors are paying all their postpetition obligations as
they come due and their negotiations with creditors and
other parties in interest related to their reorganization
process have yielded tangible results; and
d) the Debtors are not using the requested extension to
pressure the creditors into accepting an unsatisfactory Plan
and the extension will not prejudice the creditors and other
parties in interest.
Objections to the Debtors' request, if any, must be filed and
served by April 8, 2005. The Court will convene a hearing at 4:30
p.m., on April 13, 2005, to consider the Debtors' request.
Headquartered in Dallas, Texas, Keystone Consolidated Industries,
Inc., makes carbon steel rod, fabricated wire products, including
fencing, barbed wire, welded wire and woven wire mesh for the
agricultural, construction and do-it-yourself markets. The
Company filed for chapter 11 protection on February 26, 2004,
(Bankr. E.D. Wisc. Case No. 04-22422). Daryl L. Diesing, Esq., at
Whyte Hirschboeck Dudek S.C., and David L. Eaton, Esq., at
Kirkland & Ellis LLP, represent the Debtors in their restructuring
efforts. When the Company filed for protection from its
creditors, it listed $196,953,000 in total assets and $365,312,000
in total debts.
KEYSTONE CONSOLIDATED: Inks Settlement Pact with Camden County
--------------------------------------------------------------
Keystone Consolidated Industries Inc. and its debtor-affiliates
ask the U.S. Bankruptcy Court for the Eastern District of
Wisconsin to approve a settlement agreement with the Pollution
Control Financing Authority of Camden County.
In June of 2004, the PCFA filed three unsecured claims (claim
numbers 1873, 2536, 2400) against the Debtors totaling $120
million. The claims relate to the Pennsauken Sanitary Landfill in
New Jersey where the Debtors are alleged to be potentially
responsible for hazardous waste dumping at the site [Pennsauken
Solid Waste Management Authority, et al. v. Ward Sand & Material
Co., Inc., et al., L-13345-91].
To avoid length and costly litigations, the parties agree:
* to allow claim 1873 in the amount of $750,000 as a
general unsecured claim;
* claims 2535 and 2400 are disallowed; and
* the Debtors will pay $75,000 to the PCFA.
The parties also agree not to file any more charges against each
other.
Headquartered in Dallas, Texas, Keystone Consolidated Industries,
Inc., makes carbon steel rod, fabricated wire products, including
fencing, barbed wire, welded wire and woven wire mesh for the
agricultural, construction and do-it-yourself markets. The
Company filed for chapter 11 protection on February 26, 2004,
(Bankr. E.D. Wisc. Case No. 04-22422). Daryl L. Diesing, Esq., at
Whyte Hirschboeck Dudek S.C., and David L. Eaton, Esq., at
Kirkland & Ellis LLP, represent the Debtors in their restructuring
efforts. When the Company filed for protection from their
creditors, it listed $196,953,000 in total assets and $365,312,000
in total debts.
KKR FINANCIAL: Moody's Assigns Low-B Ratings to Class E & F Notes
-----------------------------------------------------------------
Moody's Investors Service has assigned ratings to notes issued by
KKR Financial CLO 2005-1, Ltd. on March 30, 2005. These ratings
were assigned:
* Aaa to the U.S. $ 615,000,000 Class A-1 Senior Secured
Floating Rate Notes, Due 2017;
* Aaa to the U.S. $ 100,000,000 Class A-2 Senior Secured
Delayed Draw Floating Rate Notes, Due 2017;
* Aa2 to the U.S. $ 58,000,000 Class B Senior Secured Floating
Rate Notes, Due 2017;
* A2 to the U.S. $ 64,000,000 Class C Deferrable Mezzanine
Secured Floating Rate Notes, Due 2017;
* Baa3 to the U.S. $ 64,000,000 Class D Deferrable Mezzanine
Floating Rate Notes, Due 2017;
* Ba2 to the U.S. $ 15,000,000 Class E Deferrable Mezzanine
Floating Rate Notes, Due 2017; and
* B2 to the U.S. $ 5,000,000 Class F Deferrable Mezzanine
Floating Rate Notes, Due 2017.
The ratings of the classes of notes are based on the expected
losses posed to the noteholders relative to the promise of
receiving the present value of all required interest and principal
payments. The ratings take into account the risk of diminishment
of cash flows due to defaults in the underlying pool of assets,
which consist primarily of senior secured loans. The transaction
is managed by KKR Financial Advixors II, LLC.
KMART HOLDING: Board of Directors Changes Fiscal Year End
---------------------------------------------------------
James F. Gooch, Kmart Holding Corporation's Vice President and
Controller, discloses in a recent filing with the Securities and
Exchange Commission that on March 18, 2005, Kmart's Board of
Directors amended Kmart's By-Laws to change its fiscal year end to
the Saturday closest to January 31 in each year commencing with
the fiscal year ending January 28, 2006. Previously, Kmart's
fiscal year ended on the last Wednesday in January.
Mr. Gooch explains that the change in fiscal year end will align
Kmart's fiscal year with the National Retail Federation calendar.
It is expected that Sears Holdings Corporation, Kmart's
subsidiary, will also have a year-end on the Saturday closest to
January 31.
Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART
Holding Corporation) -- http://www.bluelight.com/-- operates
approximately 2,114 stores, primarily under the Big Kmart or Kmart
Supercenter format, in all 50 United States, Puerto Rico, the U.S.
Virgin Islands and Guam. The Company filed for chapter 11
protection on January 22, 2002 (Bankr. N.D. Ill. Case No.
02-02474). Kmart emerged from chapter 11 protection on May 6,
2003. John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate,
Meagher & Flom, LLP, represented the retailer in its restructuring
efforts. The Company's balance sheet showed $16,287,000,000 in
assets and $10,348,000,000 in debts when it sought chapter 11
protection. Kmart bought Sears, Roebuck & Co., for $11 billion to
create the third-largest U.S. retailer, behind Wal-Mart and
Target, and generate $55 billion in annual revenues. The
waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act expired on Jan. 27, without complaint by the Department of
Justice. (Kmart Bankruptcy News, Issue No. 92; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
LANDMARK V: Moody's Assigns Ba2 Rating to $12M Class B-2L Notes
---------------------------------------------------------------
Moody's Investors Service has assigned ratings of:
* Aaa to the U.S.$5,500,000 Class X Notes due June 2010, and
the U.S.$247,500,000 Class A-1L Floating Rate Notes Due
June 2017;
* Aa2 to the U.S.$23,000,000 Class A-2L Floating Rate Notes Due
June 2017;
* A2 to the U.S.$22,500,000 Class A-3L Floating Rate Notes Due
June 2017;
* Baa2 to the U.S.$18,000,000 Class B-1L Floating Rate Notes
Due June 2017; and
* Ba2 to the U.S.$12,000,000 Class B-2L Floating Rate Notes Due
June 2017, issued by Landmark V CDO Ltd.
The collateral of Landmark V CDO Ltd. consists primarily of
speculative-grade bank loans.
According to Moody's, the ratings are based primarily on the
expected loss posed to noteholders relative to the promise of
receiving the present value of such payments. Moody's also
analyzed the risk of diminishment of cashflows from the underlying
portfolio of corporate debt due to defaults, the characteristics
of these assets and the safety of the transaction's structure.
The collateral manager is Aladdin Capital Management LLC.
LOUISE B. VAUGHN: Case Summary & 24 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: Louise B. Vaughn
P.O. Box 223
Cleveland, MS 38732
Bankruptcy Case No.: 05-11911
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Vaughn Rental, Inc. 05-12010
Chapter 11 Petition Date: March 18, 2005
Court: Northern District of Mississippi (Aberdeen)
Judge: Judge David W. Houston III
Debtors' Counsel: Craig M. Geno, Esq.
Harris & Geno, PLLC
P.O. Box 3380
Ridgeland, Mississippi 39158-3380
Tel: (601) 427-0048
Estimated Assets Estimated Debts
---------------- ---------------
Louise B. Vaughn $1 Million to $1 Million to
$10 Million $10 Million
Vaughn Rental, Inc. $1 Million to $1 Million to
$10 Million $10 Million
A. Louise B. Vaughn's 18 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
CrownMac Loan Services $115,586
PO Box 4893
Houston, TX 77252-4893
Hallmark Marketing Corporation $54,535
Credit Dept. #316
PO Box 419535
Kansan City, MO 64141-6535
Wells Fargo $46,624
Business Direct Operations
Attention: Customer Service
PO Box 348750
Sacramento, CA 95834
Bank One $37,662
MBNA-Mastercard (2 accounts) $24,700
Amrican Express $16,455
Choice Gold-Visa $13,035
Chase BankCard Services, Inc. $12,729
Direct Merchants Bank - $11,172
Mastercard
MBNA America $10,101
Cabela's Visa Center $9,442
Capital One Services, Inc. $6,721
Mastercard
Discover Card $4,718
Hughes Supply, Inc. $1,818
Tabitha Stanford $1,500
Trustmark national Bank $1,017
Mastercard
Greater Delta Telephone $650
Directory
Aspen Woods Director $600
B. Vaughn Rental, Inc.'s 6 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Hallmark Marketing Corporation $54,535
Credit Dept. #316
PO Box 419535
Kansas City, MO 64141-6535
Hughes Supply, Inc. $1,818
PO Box 105837
Atlanta, GA 30348-5837
MMC Materials $872
PO Box 5186
Greenville, MS 38704
Greater Delta Telephone $650
Directory
Aspen Woods Director $600
Bolivar County Administrator's Office $180
MANUFACTURED HOUSING: S&P's Rating on Class B-1 Tumbles to D
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the
subordinate B-1 class of Manufactured Housing Contract Sr/Sub
Pass-thru Trust 1999-2 to 'D' from 'CC'.
The lowered rating reflects the reduced likelihood that investors
will receive timely interest and the ultimate repayment of their
original principal investment. This transaction reported an
outstanding liquidation loss interest shortfall for its B-1 class
on the April 2005 payment date. Standard & Poor's believes that
interest shortfalls for this transaction will continue to be
prevalent in the future, given the adverse performance trends
displayed by the underlying pool of collateral, as well as the
location of B-1 write-down interest at the bottom of the
transaction payment priorities (after distributions of senior
principal).
Standard & Poor's will continue to monitor the outstanding ratings
associated with this transaction in anticipation of future
defaults.
MASSMUTUAL: Moody's Reviews Class B Notes for Possible Upgrade
--------------------------------------------------------------
Moody's Investors Service placed these classes of notes issued by
Mass Mutual/Darby CBO LLC, a collateralized debt obligation
issuance, on the Moody's Watchlist for possible upgrade:
(1) $360,000,000 Class A-2 Senior Secured Notes Due 2010 rated
"Aa2";
(2) $38,200,000 Class B Second Senior Secured Notes Due 2010
rated "Ba2".
Moody's noted that the transaction, which closed in December of
1997, is in its amortization period and has experienced a
significant reduction in the outstanding amount of the Class A-2
Notes. The transaction is currently passing all its collateral
coverage tests. Moody's stated that placement on the Watchlist
for possible upgrade reflects Moody's opinion that the credit
quality of the Class A-2 Notes and the Class B Notes may be
improving.
Rating Action: Placement on Moody's Watchlist for possible upgrade
Issuer: Mass Mutual/Darby CBO LLC
Tranche: U.S. $360,000,000 Class A-2 Senior Secured Notes Due 2010
* Prior Rating: Aa2
* Current Rating: Aa2 on watch for possible upgrade
Tranche: U.S. $38,200,000 Class B Second Senior Secured Notes
Due 2010
* Prior Rating: Ba2
* Current Rating: Ba2 on watch for possible upgrade
MED REHAB: Case Summary & 23 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Med Rehab, Inc.
dba West Coast Wheelchairs
1205 11th Street
Reedley, California 93654
Bankruptcy Case No.: 05-12485
Type of Business: The Debtor sells Home medical equipment
supplies and offers Medicare, Medi-cal and
insurance billing services.
Chapter 11 Petition Date: March 31, 2005
Court: Eastern District Of California (Fresno)
Judge: W. Richard Lee
Debtor's Counsel: Thomas H. Armstrong, Esq.
5250 N Palm Ave #224
Fresno, California 93704
Tel: (559) 447-4700
Estimated Assets: Unknown
Estimated Debts: $500,000 to $1 Million
Debtor's 23 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Pride Health Care, Inc. $114,765
182 Susquehanna Avenue
Exeter, PA 18643
Invacare $112,263
33416 Treasury Center
Chicago, IL 60694
Reedley Medical Supply $105,457
1205 11th Street
Reedley, CA 93654
Sunrise Medical HHG Inc. $68,121
Bryan and Terise Watcher $53,333
William Enns $27,699
VGM financial Services $27,132
Visalia Battery $11,252
Altimate Medical, Inc. $9,423
Medbloc $8,544
Wild, Carter & Tipton $4,928
PCS $4,486
Duralife Inc. $3,706
The Custom Rehab Network, Inc. $3,410
New Solutions $3,013
Snug Seat $2,297
Adaptive Engineering $2,224
Arrival $2,086
Prairie View Industries $1,801
Sammons Preston $1,627
Clarke Health Care $1,560
Products Inc.
Freedom Designs Inc. $1,257
Nove Orthopedic $1,143
MEYER'S BAKERIES: Court Approves Asset Sale to Southern Bakeries
-----------------------------------------------------------------
The Honorable James G. Mixon of the U.S. Bankruptcy Court for the
Western District of Arkansas approved the request of Meyer's
Bakeries, Inc., and its debtor-affiliate to sell their Hope,
Arkansas, and Wichita, Kansas, Facilities pursuant to Section 363
of the Bankruptcy Code free and clear of liens, claims,
encumbrances and interests, and the Assumption and Assignment of
Executory Contracts in connection with the sale on March 17, 2005.
The Debtors entered into an Asset Purchase Agreement with Southern
Bakeries, LLC, on Feb. 6, 2005, to sell their Hope, Arkansas, and
Wichita, Kansas Facilities for approximately $2 million and the
assumption and assignment to Southern Bakeries of the Assumed
Liabilities and Executory Contracts.
The Debtors tell the Court that the Asset Purchase Agreement was
negotiated and executed in good faith with Southern Bakeries.
The Asset Purchase Agreement's Bid Procedures provided that
Southern Bakeries will be entitled to receive a Break-Up Fee of
$80,000 and Expenses Reimbursement of not more than $200,000 in
the event a competitor tops its bid in an auction.
At an auction conducted on March 14, 2005, no competitor stepped
forward to top Southern Bakeries' bid.
Headquartered in Hope, Arkansas, Meyer's Bakeries, Inc., produces
English muffins, bagels, bread sticks, energy bars, and hearth
baked specialty breads and rolls at its facilities in Hope and
Wichita. The Company and its affiliate filed for chapter 11
protection on Feb. 6, 2005 (Bankr. W.D. Ark. Case No. 05-70837).
Charles T. Coleman, Esq., at Wright, Lindsey & Jennings LLP
represents the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed total
assets of $44,226,139 and total debts of $48,699,754.
MEYER'S BAKERIES: AEG Partners Approved as Financial Advisors
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Arkansas
gave Meyer's Bakeries, Inc., and its debtor-affiliate's permission
to employ AEG Partners L.L.C., as their financial advisors.
AEG Partners will:
a) review and analyze the Debtors' businesses, operations and
financial projections, and assist in the preparation of
financial information for distribution to creditors and
other parties in interest, including cash flow projections
and budgets, cash receipts and disbursement analyses,
analyses of various asset and liability accounts, and
analyses of proposed transactions;
b) analyze accounting systems maintained by the Debtors,
including developing procedures to segregate prepetition
business transactions, and guidance regarding accounting and
business issues related to the Debtors' bankruptcy
proceedings;
c) identify and analyze executory contracts and unexpired
leases, including performing cost/benefit evaluations with
respect to the assumption or rejection of executory
contracts and leases;
d) analyze creditor claims, including reclamation claims and
return of goods motions in addition to coordinating the
efforts of company personnel and counsel in the resolution
and estimation of claims;
e) assist in the preparation of information necessary related
to a Section 363 sale of the Debtors' assets and in the
preparation of information necessary for the confirmation of
a plan of reorganization and the financial data needed in
disclosure statements and liquidation analyses;
f) advise the Debtors' on various strategic issues of
negotiations with holders of existing debt obligations,
assist in identifying and evaluating candidates for a
potential sale transaction of the Debtors' assets; and
g) provide the Debtors with all other financial and general
restructuring advisory services for the efficient
administration of their chapter 11 cases.
Warner Fite, a Managing Director at AEG Partners, discloses that
the Firm received a $160,000 retainer.
Mr. Fite reports that AEG Partners' compensation consist of a
monthly Advisory Fee of $160,000 that will terminate upon the
entry of a final order confirming a plan of reorganization and the
termination of the Debtors' engagement of AEG Partners.
AEG Partners assures the Court that it does not represent any
interest adverse to the Debtors or their estates.
Headquartered in Hope, Arkansas, Meyer's Bakeries, Inc., produces
English muffins, bagels, bread sticks, energy bars, and hearth
baked specialty breads and rolls at its facilities in Hope and
Wichita. The Company and its affiliate filed for chapter 11
protection on Feb. 6, 2005 (Bankr. W.D. Ark. Case No. 05-70837).
Charles T. Coleman, Esq., at Wright, Lindsey & Jennings LLP
represents the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed total
assets of $44,226,139 and total debts of $48,699,754.
MIDDLESEX LUMBER: Case Summary & 14 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Middlesex Lumber & Supply, Inc.
500 Bound Brook Road
Middlesex, New Jersey 08846
Tel: (732) 968-3555
Bankruptcy Case No.: 05-20800
Type of Business: The Debtor is a franchisee of True Value Lumber
& Supply.
Chapter 11 Petition Date: April 5, 2005
Court: District of New Jersey (Newark)
Debtor's Counsel: Karen L. Gilman
Wolff & Samson PC
The Offices at Crystal Lake
One Boland Drive
West Orange, New Jersey 07052
Tel: (973) 530-2006
Fax : (973) 530-2206
Estimated Assets: $1,000,000 to $10,000,000
Estimated Debts: $1,000,000 to $10,000,000
Debtor's 14 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Pension Benefit Guaranty Corp. $450,000
1200 K. Street N.W.
Washington, DC 20005
Mid-State Lumber Corp. Trade debt $262,280
200 Industrial Parkway
Branchburg, NJ 08876
Black Millwork Co., Inc. Trade debt $188,927
230 West Crescent Avenue
Allendale, NJ 07401
Consolidated Distribution $48,092
5 Wheeling Road
Dayton, NY 08810
Consolidated Lumber Corp. Trade debt $36,652
PO Box 385
5 Wheeling Road
Dayton, NJ 08810
Saxonville USA Trade debt $36,438
PO Box 6119
Boston, MA 02212-6119
Futter Lumber Corp. Trade debt $13,173
Suite 200, 100 Merrick Road
Rockville Center, NY
11574-0347
Philadelphia Reserve Supply Co. $12,078
400 Mack Drive
Croydon, PA 19021
Superseal Manufacturing Trade debt $11,140
Company
125 Helen Street
S. Plainfield, NJ 07080
Reeb Millwork Corp. Trade debt $8,328
600 Brighten Street
Behtlehem, PA 18015
Eacom Timber Sales Ltd. $8,186
PO Box 8000-652
Sumas, WA 98295
Morgan Wholesale Building Trade debt $6,827
325 Morgan Lane
West Haven, CT 06516
Plunket-Webster Inc. $6,440
33708 Treasury Ctr.
Chicago, IL 60694-3700
Prime Source Receivables Co. $6,386
2517 Payshere Circle
Chicago, IL 60674
MIRANT CORP: SEC says Plan of Reorganization Unconfirmable
----------------------------------------------------------
The Securities and Exchange Commission believes that Mirant
Corporation and its debtor-affiliates' Plan of Reorganization is
facially unconfirmable. Thus, the Debtors cannot meet the
requirements of Section 1129(a)(1) of the Bankruptcy Code with
respect to any disclosure statement submitted in connection with
the Plan. In addition, the SEC points out that the Plan and
Disclosure Statement contain several disclosure deficiencies,
which should be addressed before the Disclosure Statement can be
approved.
Angela Dodd, Esq., Senior Bankruptcy Counsel for the SEC, tells
the Court that the Debtors seek to confirm a plan containing an
injunction provision that would effect a discharge of non-debtor
third party liability in contravention of Section 524(e) of the
Bankruptcy Code. The Plan provides for a permanent injunction in
favor of non-debtor third parties, including present and former
officers and directors of the Debtors, to the detriment of public
investors. Section 524(e) provides that only debts of the debtor
are affected by the Chapter 11 discharge.
Unless the injunctive provision is deleted from the Plan, the
Plan cannot satisfy the requirement of Section 1129(a)(1) of the
Bankruptcy Code, Ms. Dodd relates. Even if the Court determines
that Section 524(e) by itself does not prohibit the injunction
provisions in the Plan, they remain improper.
Ms. Dodd adds that the Plan fails to provide for judicial
determination of the reasonableness of indenture trustees' fees.
All professional fees and expenses are subject to the Court's
determination of reasonableness pursuant to Section 1129(a)(4) of
the Bankruptcy Code, whether paid from the estate or a source
outside the estate like a distribution to noteholders. Judicial
scrutiny of indenture trustee fees paid from a distribution to
noteholders provides a significant investor protection. Without
examination, distributions to noteholders under a plan could be
seriously reduced by unreasonable fees. Judicial review of those
payments from distributions to noteholders is consistent with the
Bankruptcy Code, case law and public policy.
Moreover, the SEC seeks clarification and additional disclosure
with respect to certain other matters identified in its March 8,
2005 letter to the Debtors. Although the Debtors have resolved
some of the staff's disclosure concerns as raised in the March 8
Letter, several remain outstanding.
The SEC is aware that the issues it is raising may appropriately
constitute objections to confirmation of the Plan. However, the
SEC believes that it is appropriate to raise these objections at
the disclosure stage due to the potential waste of time and
resources, which would result from soliciting approval of a plan
that is not confirmable.
The SEC asks the Court to deny the approval of the Disclosure
Statement unless:
(i) the Injunction under Section 17.19 of the Plan is
deleted from the Plan;
(ii) the Plan provides for judicial scrutiny of indenture
trustees' fees; and
(iii) the Debtors provide additional disclosure.
Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally. Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590). Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 58; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
MIRANT CORP: MAGi Committee Presents "Objectionable" Plan Issues
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of Mirant Americas
Generation, LLC, tells the U.S. Bankruptcy Court for the Northern
District of Texas that there are numerous provisions contained in
the Debtors' Plan of Reorganization that are objectionable to the
MAGi Committee, and which will be raised as objections to
confirmation of the Plan. However, there are certain threshold
issues that are so fundamental to the confirmability of the Plan,
that they need to be addressed by the Court before the Debtors'
Disclosure Statement is approved and a solicitation of acceptances
commences. Failure to address these issues will cause substantial
delay and expense to the Debtors' estates, and will prejudice
MAGi's creditors.
Deutsche Bank Securities Inc., and the Ad Hoc Committee of
Bondholders of MAGi agree.
Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP,
in New York, says the issues are:
(a) the substantive consolidation proposed by the Plan;
(b) the separate classification and discriminatory treatment
under the Plan of substantially similar unsecured claims
against MAGi;
(c) the Plan's denial of the right to vote to creditors
holding $1.7 billion in principal claims against MAGi, or
approximately 60% of the principal amount of total claims
against MAGi, under the guise of "unimpairment"; and
(d) the Plan's proposed release of prepetition and
postpetition intercompany claims and allocations, as well
as claims against third parties held by the MAGi estate.
The MAGI Committee asks the Court to enter an order scheduling
hearings, briefing and discovery on various issues relating to
the Debtors' Plan prior to hearings on the Disclosure Statement.
* * *
Judge Lynn rules that these issues will be addressed by the Court
prior to or at the time of the Disclosure Statement hearing:
1. Whether the Plan impairs, within the meaning of Section
1124 of the Bankruptcy Code, the claims of holders of
certain senior notes issued by MAGi:
(a) due 2011 in the aggregate principal amount of
$850,000,000;
(b) due 2021 in the aggregate principal amount of
$450,000,000; and
(c) due 2031 in the aggregate principal amount of
$400,000,000.
2. If the Debtors should content, whether for purposes of
determining acceptance or rejection of the Plan pursuant
to Section 1126 for purposes of Sections 1129(a)(8) and
1129(a)(10), any of the Debtors should be treated as
substantively consolidated notwithstanding the absence of
a determination by the Court after notice and an
evidentiary hearing that the consolidation is warranted
under applicable law.
"The Court will schedule the foregoing matters by further order
or otherwise," Judge Lynn says.
Nothing will limit the right of any party-in-interest to file any
objection pursuant to Rule 3017(a) or 3020(b)(1) in connection
with the Plan and accompanying Disclosure Statement, including an
objection to the consolidation of any of the Debtors for purposes
of determining that the Plan satisfies any provision of Section
1129, except, to the extent an issue is adjudicated at or prior
to the Disclosure Statement hearing, the adjudication will be
binding on all parties-in-interest for purposes of a confirmation
hearing on the Plan.
Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally. Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590). Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 58; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
MISSION RESOURCES: Petrohawk Energy Inks Acquisition Agreement
--------------------------------------------------------------
Petrohawk Energy Corporation (NASDAQ: HAWK) and Mission Resources
Corporation (NASDAQ: MSSN) entered into a definitive agreement
whereby Petrohawk will acquire Mission for a combination of
Petrohawk stock, cash and the assumption of debt.
Total consideration will be approximately 60 percent Petrohawk
common stock and 40 percent cash and will consist of approximately
19.2 million Petrohawk common shares and $135 million cash. Under
the terms of the merger agreement, Mission shareholders will have
the right to elect to receive cash or Petrohawk common stock,
subject to a proration if either cash or stock is oversubscribed.
Based on the closing prices of Petrohawk and Mission on April 1,
2005, the implied acquisition price represents a premium to
Mission stockholders of approximately 19%.
Floyd C. Wilson, Chairman, President, and Chief Executive Officer
of Petrohawk, said, "We believe Mission offers a number of
important features that we look for - undervalued or
underdeveloped properties in areas where we have technical
expertise, near-term non-core divestments, opportunities for
accelerated development of proved undeveloped reserves, an
attractive acreage position and significant upside in the form of
3-D seismic based drilling prospects, all within existing core
areas.
"Bob Cavnar and his fine management group have truly created a new
Mission - we believe this asset base will complement Petrohawk's
property portfolio, as have previous acquisitions of companies
with similar attributes. I am especially excited as I review the
combined capital program and the extensive inventory of 3-D based
drilling opportunities. I view this transaction as an opportunity
for measured growth in very familiar areas. We will continue to
attempt to increase shareholder value as we build the company for
eventual sale or merger."
Robert L. Cavnar, Chairman, President and Chief Executive Officer
of Mission Resources, added, "We believe this transaction offers
to our shareholders and employees significantly enhanced
opportunities. By combining Mission's strong inventory of
exploitation projects in the Permian Basin and exploration
projects on the Gulf Coast with Petrohawk's portfolio of
attractive development projects in the Permian, Anadarko and East
Texas Basins and exciting exploration projects in the Arkoma Basin
and along the Gulf Coast, we create a combined company with a
multi-year inventory of diversified projects in key U.S.
hydrocarbon basins.
"Over the past two years, Mission has completed its financial
restructuring and substantially enhanced the company's asset base
through drilling, acquisitions and divestitures, while reducing
both per unit costs and debt load. We have a high degree of
confidence that Floyd and his management team have the vision and
the ability to further enhance the combined company. We believe
that this merger is a natural next step for Mission and that the
combination of our companies' staffs will create a terrific team
for the combined shareholders."
Netherland, Sewell and Associates, an independent reserve
engineering firm, prepares both Petrohawk's and Mission's
estimates of proved reserves.
Pro Forma 2005 Petrohawk Guidance and Capital Budget:
In conjunction with the announcement of the transaction, Petrohawk
is updating 2005 guidance pro forma for the acquisition as if it
had occurred on January 1, 2005. In this initial view of pro
forma guidance, no post-merger activities have been included, such
as cost savings synergies, additional acquisitions, or divestment
of high cost, non-core properties.
The pro forma combined capital program for 2005 represents record
activity levels in core operating areas and includes over 300
projects (new wells, recompletions, workovers).
Hedging:
Petrohawk will continue its strategy of hedging a significant
percentage of its forecasted production for a two to three year
period. Given the current commodity markets, consideration will
be given to restructuring certain older derivative positions and
replacing them with more current, strategic derivative
transactions.
Merger Agreement
Total consideration for the shares of Mission is fixed at
approximately $135 million in cash and approximately 19.2 million
Petrohawk common shares not including outstanding Mission stock
options. Mission stock options will convert into Petrohawk
options pursuant to the terms of the merger agreement.
Under the terms of the merger agreement, Mission shareholders will
have the right to elect cash or Petrohawk common stock, subject to
a proration if either cash or stock is oversubscribed. While the
per share consideration is established in the merger agreement at
$8.15 in cash or 0.7718 shares of Petrohawk common stock, the per
share consideration is subject to adjustment upwards or downwards
so that each Mission share receives consideration representing
equal value. This adjustment will reflect 46.3% of the difference
between $10.56 and the price of Petrohawk's shares during a
specified period prior to closing. Based on the April 1 closing
price of $11.53 of Petrohawk, the adjusted per share consideration
would be valued at $8.60 or 0.7458 shares of Petrohawk common
stock.
Floyd C. Wilson will remain as Petrohawk's Chairman, President and
CEO. Following the completion of the transaction, two directors
nominated by Mission will join Petrohawk's board of directors.
The acquisition is subject to the approval of the shareholders of
Mission and Petrohawk. The boards of directors of both companies
have unanimously approved the transaction, which is subject to
customary conditions, including approval of listing of the
Petrohawk shares to be issued in the acquisition on NASDAQ and
regulatory approvals. The acquisition is expected to be completed
during the third quarter of 2005.
Petrie Parkman & Co. acted as financial advisor and Porter &
Hedges LLP acted as legal advisor to Mission. Merrill Lynch & Co.
rendered a fairness opinion to Mission. Hinkle Elkouri Law Firm
LLC and Thompson & Knight LLP acted as legal advisors to Petrohawk
and Sanders Morris Harris provided a fairness opinion for
Petrohawk.
About Petrohawk Energy
Petrohawk Energy Corporation is an independent energy company
engaged in the acquisition, production, exploration and
development of oil and gas, with properties concentrated in the
South Texas, Mid-Continent, East Texas, Arkoma, Permian and Gulf
Coast regions.
About Mission Resources
Mission Resources Corporation is a Houston-based independent
exploration and production company that drills for, acquires,
develops and produces natural gas and crude oil primarily in the
Permian Basin (in West Texas and Southeastern New Mexico), along
the Texas and Louisiana Gulf Coast and in both the state and
federal waters of the Gulf of Mexico.
* * *
As reported in the Troubled Company Reporter on Nov. 16, 2004,
Standard & Poor's Rating Services affirmed its 'B-' corporate
credit rating and 'CCC' senior unsecured debt rating on
independent oil and gas exploration and production company Mission
Resources Corp.
Moody's, this week, placed these three ratings on review:
i) Caa1 -- senior implied rating
ii) Caa2 -- $130 million senior unsecured notes
iii) Caa2 -- Mission's senior unsecured issuer rating
and said the direction is uncertain.
MISSION RESOURCES: Moody's Reviews $130M Sr. Unsec. Bond Rating
---------------------------------------------------------------
Moody's placed Mission Resources' ratings under review with a
direction uncertain following the announcement that Petrohawk
Energy Corporation' is acquiring Mission Resources. Total
consideration will be approximately 60 percent Petrohawk common
stock and 40 percent cash and will consist of approximately
19.2 million Petrohawk common shares and $135 million in cash.
Moody's does not currently rate Petrohawk Energy. Petrohawk will
assume approximately $170 million of MSSN debt and is likely to
issue about $125 million of notes in the high yield market.
Pro-forma reserves would total 74.3 mmboe, of which 55.8 mmboe
(75%) would be PD reserves having roughly a 7.3 year PD reserve
life.
The review will enable Moody's to complete a review of Petrohawk
energy (unrated) and the effect of the combination will have upon
the bondholders at Mission Resources. While Mission had been
making significant progress in stabilizing the financial structure
with a recapitalization last year, growing the company's reserves
and production base, improving the cost structure and reducing
leverage on the PD reserve basis, the initial leverage of the
combined companies will be approximately $9.63/boe, which is much
higher than Mission $5.57/boe at FYE December 12, 2004.
It appears that there are opportunities for synergies given the
proximity of the pro forma reserves and production, however,
Moody's review will enable them to better asses the trends at
Petrohawk and to fully understand the company's strategy in terms
of capitalization and potential asset sales.
Petrohawk is paying in the range of $12.40/boe of proven reserves
for MSSN (including MSSN's $130 million of senior notes) or
$49,211/boe of daily production. Pro-forma debt on proven
developed (PD) reserves approximates a fairly high $9.60/boe.
Fully loaded for debt and engineered development capex, total
leverage on total proved reserves will approximate $9.87/boe.
Pro-forma full cycle costs (including pro-forma operating,
interest, and three year average reserve replacement costs) appear
to be in the range of $37/boe (using 2004 annual all-sources
reserve replacement costs).
These Mission ratings are placed on review with a direction
uncertain:
i) Caa1 - senior implied rating
ii) Caa2 - $130 million senior unsecured notes
iii) Caa2 -- Mission's senior unsecured issuer rating
Mission Resources is headquartered in Houston, Texas.
MJ RESEARCH: Court Awards $35 Million More in Patent Litigation
---------------------------------------------------------------
The U.S. District Court in New Haven, Conn., has issued an
additional ruling in Applera's and Roche Molecular Systems' patent
infringement litigation against MJ Research, a division of Bio-Rad
Laboratories, Inc. (AMEX: BIO).
The Court, based on the jury's April 2004 finding that MJ Research
had willfully infringed patents relating to polymerase chain
reaction owned by Applied Biosystems and Roche Molecular Systems,
increased damages awarded to Applied Biosystems and Roche to
approximately $35 million, in addition to awarding reasonable
attorneys' fees. The Court also has dismissed all of MJ
Research's antitrust counterclaims against Applied Biosystems and
Roche. Applied Biosystems Group has filed for an injunction
against further infringement by MJ Research, including an
injunction against sales of MJ Research thermal cycler products.
"The Court's ruling complements the earlier jury verdict, and
further validates the strength of our intellectual property
portfolio and our contributions to the development of PCR
technology," said Catherine M. Burzik, President of Applied
Biosystems. "We will continue to license our technology under
suitable circumstances and defend our intellectual property."
As previously announced, the jury awarded damages in the amount of
$19.8 million to Applied Biosystems and Roche. MJ Research filed
for bankruptcy court protection on March 29, 2004, and was
acquired by Bio-Rad Laboratories in August 2004.
Applera and Roche originally filed this patent infringement case
in the U.S. District Court in Connecticut in June 1998. MJ
Research counterclaimed that Applera Corporation licensed and
enforced these patents through anticompetitive conduct, in
violation of federal and state antitrust laws. The Court rejected
MJ Research's counterclaims, and found that Ap plera did not
violate any federal or state antitrust laws.
Headquartered in Reno, Nevada, MJ Research, Incorporated
-- http://www.mjr.com/-- specializes in the instrument and
reagent technology needed for modern biological research. The
Company filed for chapter 11 protection on March 29, 2004 (Bankr.
D. Nev. Case No. 04-50861). Jennifer A. Smith, Esq., at Lionel
Sawyer & Collins 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.
NATIONAL ENERGY: Inks Pact Resolving Brascan Energy's Claims
------------------------------------------------------------
Brascan Energy Marketing, Inc., asserted Claim No. 353 for
$7,537,550 against National Energy & Gas Transmission, Inc., and
Claim No. 354 against NEGT Energy Trading - Gas Corporation for
$7,537,550. Pursuant to an assignment agreement dated January 1,
2005, Brascan Energy assigned Claim No. 354 to Contrarian Funds,
LLC.
To settle amicably all matters relating to the Brascan Claims,
NEGT, ET Gas, Brascan Energy and Contrarian Funds entered into a
stipulation resolving the Brascan Claims. The parties agree
that:
(i) Claim No. 353 will be disallowed and expunged in its
entirety;
(ii) Claim No. 354 will be reduced and allowed as a general
unsecured claim against ET Gas for $7,531,000, and will
be considered an allowed claim under Section 502(a) of
the Bankruptcy Code; and
(iii) Pendency Interest will accrue on Claim No. 354 at a rate
of 2.5%.
In addition, Contrarian Funds agreed to accept and not to object
to the ET Debtors' Plan, including any modifications or
amendments thereto that do not affect the validity, amount, or
priority of Claim No. 354 or the rate of Pendency Interest to be
earned thereon.
NEGT and ET Gas, therefore, ask the Court to approve their
stipulation with Brascan and Contrarian.
Headquartered in Bethesda, Maryland, PG&E National Energy Group,
Inc. -- http://www.pge.com/-- (n/k/a National Energy & Gas
Transmission, Inc.) develops, builds, owns and operates electric
generating and natural gas pipeline facilities and provides energy
trading, marketing and risk-management services. The Company and
its debtor-affiliates filed for Chapter 11 protection on July 8,
2003 (Bankr. D. Md. Case No. 03-30459). Matthew A. Feldman, Esq.,
Shelley C. Chapman, Esq., and Carollynn H.G. Callari, Esq., at
Willkie Farr & Gallagher, and Paul M. Nussbaum, Esq., and Martin
T. Fletcher, Esq., at Whiteford, Taylor & Preston L.L.P.,
represent the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
$7,613,000,000 in assets and $9,062,000,000 in debts. NEGT
received bankruptcy court approval of its reorganization plan in
May 2004, and that plan took effect on Oct. 29, 2004. (PG&E
National Bankruptcy News, Issue No. 37; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
NATIONAL ENERGY: Wants Court to Extend Claims Objection Deadline
----------------------------------------------------------------
In February 2005, the U.S. Bankruptcy Court for the District of
Maryland extended Reorganized National Energy & Gas Transmission,
Inc.'s deadline to file objections to certain claims or categories
of claims through and including March 28, 2005.
One of the Claims identified by the Reorganized NEG as being
actively negotiated is Claim No. 353 filed by Brascan Energy
Marketing, Inc. The issues surrounding Claim No. 353 were
resolved by a stipulation, which will be presented to the Court
for approval today, April 6, 2005.
By this motion, Reorganized NEG asks the Court to further extend
its Claims Objection Deadline as to Claim No. 353 until the Court
issues a final and non-appealable order approving the Stipulation
with Brascan Energy.
Dennis J. Shaffer, Esq., at Whiteford, Taylor & Preston L.L.P.,
in Baltimore, Maryland, tells the Court that the extension is not
sought to delay the Chapter 11 proceedings and will not prejudice
any claimants or other parties-in-interest.
Headquartered in Bethesda, Maryland, PG&E National Energy Group,
Inc. -- http://www.pge.com/-- (n/k/a National Energy & Gas
Transmission, Inc.) develops, builds, owns and operates electric
generating and natural gas pipeline facilities and provides energy
trading, marketing and risk-management services. The Company and
its debtor-affiliates filed for Chapter 11 protection on July 8,
2003 (Bankr. D. Md. Case No. 03-30459). Matthew A. Feldman, Esq.,
Shelley C. Chapman, Esq., and Carollynn H.G. Callari, Esq., at
Willkie Farr & Gallagher, and Paul M. Nussbaum, Esq., and Martin
T. Fletcher, Esq., at Whiteford, Taylor & Preston L.L.P.,
represent the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
$7,613,000,000 in assets and $9,062,000,000 in debts. NEGT
received bankruptcy court approval of its reorganization plan in
May 2004, and that plan took effect on Oct. 29, 2004. (PG&E
National Bankruptcy News, Issue No. 37; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
NAVARRE CORP: Terminates Sr. Debt Offering Due to Market Weakness
-----------------------------------------------------------------
Navarre Corporation's (Nasdaq: NAVR) previously announced senior
note offering has been terminated due to the recent weakness of
the bond market. The company reiterated that it anticipates
closing the FUNimation acquisition prior to May 15, 2005.
About the Company
Navarre Corporation (Nasdaq: NAVR) -- http://www.navarre.com/--
is a leading publisher and distributor of a broad range of home
entertainment and multimedia products, including PC software, CD
audio, DVD and VHS video, video games and accessories. Since its
founding in 1983, the company has established distribution
relationships with customers across a wide spectrum of retail
channels which includes mass merchants, discount, wholesale club,
office and music superstores, military and e-tailers nationwide.
The company currently provides its products to over 18,000 retail
and distribution center locations throughout the United States and
Canada. Navarre has recently expanded its business to include the
licensing and publishing of home entertainment and multimedia
content, primarily through the acquisitions of Encore Software,
Inc., and BCI Eclipse Company, LLC.
* * *
As reported in the Troubled Company Reporter on March 23, 2005,
Moody's Investors Service assigned the debt rating of B3 to the
prospective senior unsecured debt issue of Navarre Corporation.
The debt is being issued to finance the cash portion of Navarre's
acquisition of FUNimation as well as provide liquidity to the
company.
These ratings were assigned:
* Senior implied of B2;
* Senior unsecured issuer rating of B3;
* $125 million senior unsecured notes maturing 2012 rated B3;
* Speculative Grade Liquidity Rating of SGL-2.
Moody's said the rating outlook is stable.
NORTHWEST ALUMINUM: Judge Dunn Confirms Second Amended Plan
-----------------------------------------------------------
The Honorable Randall L. Dunn of the U.S. Bankruptcy Court for the
District of Oregon confirmed the Second Amended Joint Plan of
Reorganization filed by Northwest Aluminum Company and its debtor-
affiliates. Judge Dunn confirmed the Amended Plan on March 1,
2005.
Judge Dunn approved the Debtors' Second Amended Disclosure
Statement on Jan. 14, 2005.
Judge Dunn concluded that the Plan:
a) satisfies Section 1123(a)(4) of the Bankruptcy Code for
providing the same treatment for each claims or interest in
a particular class, unless the holder of a claim or interest
agrees to less favorable treatment;
b) satisfies Section 1123(a)(5) of the Bankruptcy Code for
providing adequate means for its implementation, which will
be primarily undertaken by Holdco and its subsidiary
entities, the Disbursing Agent and Exchange Agent and the
Indenture Trustee;
c) complies with the applicable provisions of Section
1129(a)(1) and Section 1129(a)(2) of the Bankruptcy Code and
the Plan was proposed in good faith in accordance with
Section 1129(a)(3);
d) satisfies Section 1129(a)(7) of the Bankruptcy Code with
respect to the treatment of each impaired Class of Claims or
Interests and the Plan is fair and equitable to all other
Classes who will not receive or retain any property under
the Plan; and
e) satisfies Section 1129(a)(11) of the Bankruptcy Code for its
feasibility and offers a reasonable prospect of success and
it will not likely be followed by a liquidation or a need
for further financial reorganization.
The Amended Plan provides for the formation of a new Delaware
corporation, referred to as Holdco, where Golden Northwest
Aluminum, Inc., will transfer substantially all of its assets,
including its ownership interests in Northwest Aluminum Company,
Northwest Aluminum Specialties Inc., and Northwest Aluminum
Technologies, LLC.
The reorganization will be accomplished by issuing Holdco equity
in exchange for most of the Debtors' prepetition debt, by raising
capital through the sale of certain Holdco promissory notes, and
by raising additional working capital intended primarily for
Aluminum Specialties' use through a new revolving credit facility.
A full text copy of the Amended Plan is available at no charge at:
http://bankrupt.com/misc/NorthwestAluminum2ndAmendedPlan.pdf
Headquartered in The Dalles, Oregon, Northwest Aluminum Company
-- http://www.nwaluminum.com/-- is a subsidiary of Golden
Northwest Aluminum, Inc., engaged in the production of aluminum
billet for hot extrusion, hot or cold impact extrusion, and hot or
cold forging stock in most aluminum alloys. The Company and its
debtor-affiliates filed for chapter 11 protection on November 10,
2004 (Bankr. D. Ore. Case No. 04-42061). The case is jointly
administered under Golden Northwest Aluminum, Inc., (Bankr. D.
Ore. Case No. 03-44107). Richard C. Josephson, Esq., at Stoel
Rives LLP, represents the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, it
listed estimated assets of $10 million to $50 million and
estimated debts of more than $100 million.
NORTHWESTERN CORP: Wants Ballot Agents to Identify Claim Holders
----------------------------------------------------------------
NorthWestern Corporation, d/b/a NorthWestern Energy, asks the U.S.
Bankruptcy Court for the District of Delaware to enter an order
compelling the Master Ballot Agents:
a) to identify the name, address, tax identification number and
number of shares held, of the individual beneficial claims
holders Class 7, Class 8(a) and Class 8(b) Claims that voted
against the Releases in the Debtors' Second Amended and
Restated Plan of Reorganization in connection with the
Debtor's Initial Solicitation and Resolicitation process
for the voting performed on the Plan; and
b) to identify individual beneficial holders of Class 8(b)
claims and the election made as to Option 1 and Option 2
under the confirmed Second Amended Plan.
The Reorganized Debtor wants the Court to require the Master
Ballot Agents to provide the necessary information of the non-
releasing holders to their Tabulation Agent, Bondholder
Communications Group.
The Court confirmed the Debtor's Amended Plan on Oct. 20, 2004,
and the Plan became effective on Nov. 1, 2004.
The Debtor explains that it has only been provided with the
summary information in connection with the Initial Solicitation or
the Resolicitation, and it does not have information regarding the
identity of individual beneficial holders who voted against the
Releases prescribed under the Plan.
At the present, the Reorganized Debtor cannot identify the
individual beneficial holders who voted not to accept the Releases
provided under the Plan, and as a result, those unidentified
individual beneficial holders have reserved certain rights against
the Debtor.
The Reorganized Debtor needs to identify holders who have reserved
claims and who voted against the Releases under the Plan in order
for the Reorganized Debtor to manage any claims that may be
asserted in connection with the confirmed Plan and enforce the
distribution provisions under the Plan.
The Court convened a hearing on April 4, 2005, to consider the
Debtors' request, but Bankruptcy Court records do not show if the
hearing has been continued or the Court will enter a final order
on the Debtor's request.
Headquartered in Sioux Falls, South Dakota, NorthWestern
Corporation (Pink Sheets: NTHWQ) -- http://www.northwestern.com/
-- provides electricity and natural gas in the Upper Midwest and
Northwest, serving approximately 608,000 customers in Montana,
South Dakota and Nebraska. The Debtors filed for chapter 11
protection on September 14, 2003 (Bankr. Del. Case No. 03-12872).
Scott D. Cousins, Esq., Victoria Watson Counihan, Esq., and
William E. Chipman, Jr., Esq., at Greenberg Traurig, LLP, and
Jesse H. Austin, III, Esq., and Karol K. Denniston, Esq., at Paul,
Hastings, Janofsky & Walker, LLP, represent the Debtors in their
restructuring efforts. On the Petition Date, the Debtors reported
$2,624,886,000 in assets and liabilities totaling $2,758,578,000.
The Court entered a written order confirming the Debtors' Second
Amended and Restated Plan of Reorganization, which took effect on
Nov. 1, 2004.
At Sept. 30, 2004, NorthWestern Corp.'s balance sheet showed a
$602,981,000 stockholder's deficit, compared to a $585,951,000
deficit at Dec. 31, 2003.
NRG ENERGY: Hosting Annual Stockholders' Meeting on May 24
----------------------------------------------------------
NRG Energy, Inc., will host its Annual Meeting of Stockholders on
May 24, 2005, at the Hotel du Pont in Wilmington, Delaware,
beginning at 10:00 a.m. EST, the Company said in a regulatory
filing with the Securities and Exchange Commission.
The purpose of the Annual Meeting is to:
(1) elect directors;
(2) approve an amendment to Article Seven of the Company's
Amended and Restated Certificate of Incorporation;
(2) approve an amendment deleting Article Sixteen of the
Amended and Restated Certificate of Incorporation;
(3) ratify the appointment of KPMG LLP as NRG's independent
registered public accounting firm; and
(4) conduct other business as may properly come before the
Annual Meeting.
"A report on Company operations and a discussion of our plans
will be made at the meeting and there will be time for your
questions and comments," David Crane, President and Chief
Executive Officer, says.
Stockholders of NRG may attend the Annual Meeting. However, only
stockholders who owned NRG stock at the close of business on
April 8, 2005, the record date, or their duly appointed proxies,
are entitled to vote at the meeting. Proof of ownership of NRG
stock, along with personal identification, must be presented to
be admitted. If shares are held in the name of a bank, broker or
other holder of record, a brokerage statement or other proof of
ownership must be presented.
Mr. Crane reports that, as of the record date, [87,045,104]
shares of common stock and 420,000 shares of preferred stock were
issued and outstanding. Each share of NRG's common stock and
preferred stock is entitled to one vote per share.
No cameras, recording equipment, electronic devices, large bags,
briefcases, or packages will be permitted in the Annual Meeting.
Election of New Class II Directors
NRG's Board is divided into three classes serving staggered
three-year terms. Directors for each class are elected at the
Annual Meeting of Stockholders held in the year in which the term
for their class expires.
Mr. Crane relates that the terms of the three Class II directors
will expire at the 2005 Annual Meeting. The Class II directors
elected at the 2005 Annual Meeting will hold office for a three-
year term expiring at the Annual Meeting in 2008 -- or until
their successors are elected and qualified, or until their
earlier death, resignation, or removal. There are no family
relationships among the Company's executive officers and
directors.
Nominees
Howard E. Cosgrove, Chairman, on behalf of NRG's Board of
Directors, recommends the election of:
(A) Lawrence S. Coben, 46
Compensation Committee (Chair)
Mr. Coben has been a director of NRG since December 2003,
pursuant to the NRG plan of reorganization. He is
Chairman and CEO of Tremisis Energy Acquisition
Corporation. From January 2001 to January 2004, he was a
Senior Principal of Sunrise Capital Partners, a private
equity firm. From 1997 to 2001, Mr. Coben was an
independent consultant. From 1994 to 1996, Mr. Coben was
Chief Executive Officer of Bolivian Power Company. Mr.
Coben is also a director of Prisma Energy.
(B) Herbert H. Tate, 51
Governance and Nominating Committee
Mr. Tate has been a director of NRG since December 2003,
pursuant to the NRG plan of reorganization. Mr. Tate
joined NiSource, Inc. as Corporate Vice President,
Regulatory Strategy in July 2004. He was Of Counsel of
Wolf & Samson P.C., a law firm, since September 2002 to
July 2004. Mr. Tate was Research Professor of Energy
Policy Studies at the New Jersey Institute of Technology
from April 2001 to September 2002 and President of New
Jersey Board of Public Utilities from 1994 to March 2001.
Mr. Tate is also a director of IDT Capital and IDT
Spectrum. Previously, Mr. Tate was a member of the Board
of Directors for Central Vermont Public Service from April
2001 to June 2004, where he was a member of the Audit
Committee.
(C) Walter R. Young, 60
Audit Committee
Compensation Committee
Mr. Young has been a director of NRG since December 2003,
pursuant to the NRG plan of reorganization. Mr. Young was
Chairman, Chief Executive Officer and President of
Champion Enterprises, Inc., an assembler and manufacturer
of manufactured homes, from May 1990 to June 2003. Mr.
Young has held senior management positions with The Henley
Group, The Budd Company, and BFGoodrich.
Amendment to Article Seven
The Board proposes to enlarge the members of the board to up to
15 directors and to fill newly created directorships. The Board
recommends that the stockholders approve this proposal.
The principal purpose of the amendment, Mr. Crane explains, is to
provide NRG's Board with more flexibility to add selected talents
and skills from time to time. The amendment will allow the Board
to increase its size and add directors with diverse backgrounds
and experiences while at the same time ensuring continuity on the
Board. Also, the amendment would enable the Board to increase
the number of independent directors and their numbers on Board
committees in a manner that would potentially permit greater
diversity on committees and a greater ability to cover unplanned
vacancies.
Deletion of Article Sixteen
During NRG's Chapter 11 proceedings, pursuant to the requirements
of the Bankruptcy Code, the Certificate of Incorporation was
amended to include the limitation in Article Sixteen on its
ability to issue non-voting equity securities while under Section
1123(a)(6) of the Bankruptcy Code. Mr. Crane relates that
Article Sixteen is no longer required pursuant to the
confirmation of NRG's plan of reorganization. As a result, the
Amended and Restated Certificate of Incorporation contains a
limitation that is no longer applicable. Therefore, the Board
recommends deletion of Article Sixteen.
Employment of KPMG
The Audit Committee expects to appoint KPMG LLP to audit the
consolidated financial statements of NRG and its subsidiaries for
the year 2005 at a meeting to be held in late April 2005. If the
stockholders do not ratify the appointment of KPMG, the Audit
Committee will reconsider its selection. Representatives of KPMG
are expected to attend the Annual Meeting where they will be
available to respond to questions and, if they desire, to make a
statement.
The Audit Committee first engaged KPMG LLP as the Company's
independent registered public accounting firm on May 24, 2004.
Prior to hiring KPMG LLP, the Company's independent registered
public accounting firm was PricewaterhouseCoopers LLP.
Mr. Crane encourages stockholders of record, whether or not
attending the Annual Meeting, to cast their votes. Voting may be
done on the Internet, by telephone, or by completing and mailing
a traditional proxy card.
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. The Company emerged from chapter
11 on December 5, 2003, under the terms of its confirmed Second
Amended Plan. James H.M. Sprayregen, Esq., Matthew A. Cantor,
Esq., and Robbin L. Itkin, Esq., at Kirkland & Ellis, represented
NRG Energy in its $10 billion restructuring.
* * *
As reported in the Troubled Company Reporter on Dec. 14, 2004,
Standard & Poor's Ratings Services assigned its 'CCC+' rating to
NRG Energy Inc.'s (NRG; B+/Stable/--) proposed $400 million
convertible perpetual preferred stock. S&P says the outlook is
stable.
OCTANE ENERGY: Closes $5.4 Million Sale of Pronghorn Controls Unit
------------------------------------------------------------------
Octane Energy Services Ltd. (TSX-V:OES) has closed the previously
announced sale of its wholly owned subsidiary, Pronghorn Controls
Ltd. for a price of $5,400,000. The purchasers, North Point
Mezzanine Limited Partnership and 1158979 Alberta Ltd., intend to
continue the operations of Pronghorn in the provinces of Alberta
and Saskatchewan.
The transaction was recommended by the independent committee of
the board of directors of Octane, and was supported by management
of Octane and Pronghorn, their respective boards of directors, the
Monitor of Octane, Ernst and Young Inc. and Octane's financial
advisor, Ernst & Young Orenda Corporate Finance Inc. The proceeds
received from the sale will be used to repay Octane's secured
debts and to fund Octane's Plan of Arrangement.
Octane also announces that the Court of Queen's Bench of Alberta
has approved the distribution and mailing of Octane's Plan. The
Plan contemplates a Creditors' Meeting for April 21, 2005 to
consider and approve its terms.
Octane Energy Services Ltd. remains under management direction
under the protection of the CCAA filing and expects to emerge from
the CCAA proceedings by the end of April.
Octane Energy Services Ltd. remains under management direction
under the protection of the CCAA filing and its wholly owned
subsidiary Pronghorn Controls Ltd. remains intact and outside of
the CCAA process. Pronghorn Controls Ltd. will carry on business
in the ordinary course as it has done since the filing under the
CCAA on October 15, 2004. Octane Energy Services Ltd.'s wholly
owned subsidiaries, Octane Energy Services, Inc., and Octane
Energy Services (BC), Inc., were placed into receivership by
consent after close of business on Friday, December 4, 2004. In
addition, the role of the court appointed monitor was expanded at
the parent company (Octane Energy Services Ltd.) and includes a
receivership over the equipment held in that corporate entity.
Octane is an oilfield services company whose main business is
providing electrical and instrumentation services through its
subsidiary Pronghorn, Pronghorn remains outside of the CCAA
process and continues to operate in the ordinary course of
business. The common shares of Octane trade on the TSX Venture
Exchange under the symbol "OES".
ORMET CORP: Steelworkers Union Slams Executives' "Huge" Salaries
----------------------------------------------------------------
The United Steelworkers of America said that despite Ormet
Corporation's completion of its financial reorganization and exit
from bankruptcy, creditor recoveries could still evaporate
entirely while the CEO Mike Williams and the company's other top
managers continue to collect huge salaries.
A report released by the USWA earlier this year noted that the
company's financial projections were based on flawed assumptions
that pumped up projected cash flows and created unrealistic
expectations for recoveries by unsecured creditors.
According to Potok, Campbell and Co., who conducted the research
for the USWA, two of Ormet's most uncertain assumptions include
the company's ability to defer 2006 and 2007 payments to its
pension fund and that the company will be able to liquidate
inventories and receivables without any deterioration in
recoveries over the next six months.
"Laying-off employees, contracting-out jobs, cutting wages,
slashing retiree health insurance benefits and reducing production
capacity while doing business with a company owned by an
individual charged with threatening Steelworkers with a shotgun
are not responsible solutions to Ormet's long-term financial
problems," said USWA District 1 Director David McCall. "Ormet
management and its new board of directors must now take
responsibility for the current labor dispute, return to the
bargaining table and commit to working with the USWA to achieve a
fair contract in Hannibal."
Mr. McCall pointed out that the Union has made a number of
contract proposals based on the principles that enabled other
bankrupt Steelworker employers to thrive after emerging from
bankruptcy. The Union's latest proposal to Ormet would preserve
as many jobs as possible and largely retain existing levels of
wages and benefits for active members and retirees while achieving
savings in humane ways that place less of the burden on workers
and retirees.
Headquartered in Wheeling, West Virginia, Ormet Corporation --
http://www.ormet.com/-- is a fully integrated aluminum
manufacturer, providing primary metal, extrusion and thixotropic
billet, foil and flat rolled sheet and other products. The
Company and its debtor-affiliates filed for chapter 11 protection
on January 30, 2004 (Bankr. S.D. Ohio Case No. 04-51255). Adam C.
Harris, Esq., in New York, represents the Debtors in their
restructuring efforts. When the Company filed for bankruptcy
protection, it listed $50 million to $100 million in estimated
assets and more than $100 million in total debts.
PAN AMERICAN: Good Financial Performance Cues S&P to Lift Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term local and
foreign currency corporate credit ratings on Pan American Energy
LLC to 'B+' from 'B'. The outlook on the local currency rating is
positive; the outlook on the foreign currency rating is stable.
U.S.-incorporated PAE is 60% owned by BP PLC (AA+/Stable/A-1+) and
40% by Bridas Corp.
BP is one of the largest integrated oil and gas companies in the
world, with a large reserve base of 14.5 billion barrels of oil
equivalent (boe) as of December 2004. PAE had US$655 million in
total debt outstanding at Sept. 30, 2004.
The upgrade is based on S&P's perceptions of a strengthening of
the economic and operating environments in Argentina and more
specifically on expectations that PAE will continue to show sound
financial and operating performance despite the still challenging
conditions in the country and a certain degree of sovereign
intervention.
The ratings on Argentina-based oil and gas producer PAE reflect
its heavy concentration in Argentina, exposing the company to the
risks of operating under a highly uncertain and rapidly changing
economic and regulatory environment, as well as a significant need
for capital expenditures to develop its large reserve base. The
ratings also reflect the company's relatively large reserve base,
low operating costs, outstanding credit measures, and a very sound
financial profile despite the Argentine economic crisis since
2001.
PAE's foreign currency rating is two notches above the expected
rating on Argentina once the sovereign restructuring has been
concluded, which we have indicated will be 'B-'. PAE's foreign
currency rating reflects our current views on transfer and
convertibility risk in Argentina, PAE's partial insulation from
Argentine transfer and convertibility risk due to its substantial
foreign currency generation (57% of revenues are from exports or
offshore operations), the preferred export repatriation
requirement granted to Argentine oil and gas companies throughout
the crisis that allowed the company to access offshore cash, a
moderate financial policy, and strong financial statistics for the
rating category.
PAE's operations are concentrated in Argentina, where the company
holds 67% of its proved reserves and generates more than 90% of
its production. However, PAE has started diversifying by adding
Bolivian reserves and production. As a result of the geographic
location of reserves and production, "we consider country risk to
be one of the main determinants of the company's credit quality,
as PAE's business position is strongly affected by the
uncertainties of the regulatory and institutional environments in
Argentina and Bolivia," said Standard & Poor's credit analyst
Pablo Lutereau. "These weaknesses in the business profile are
mitigated at the current rating category by a very competitive
cost structure, sound management, and a very important reserve
base that the company has been bringing into production despite
the challenging conditions of the past few years," he added.
The positive outlook on the local currency rating reflects our
expectations that if PAE maintains solid operating and financial
performance, and the perception of Argentina's institutional risk
continues to decrease, the ratings could be raised. From an
operating performance, S&P said it expects the company to be able
to increase production by 10% in the next two years while being
able to fully replace reserves. S&P also expects PAE's operating
performance to translate into free operating cash to net debt in
excess of 15% and EBITDA interest coverage above 7x, even with
realization prices 30% lower than those observed in 2004. Raising
the rating to 'BB-' would also require an improvement in the debt
maturity profile, lengthening the average life of PAE's
indebtedness. The outlook could be reevaluated (and the ratings
could be lowered) following additional intervention by the
government, which could seriously jeopardize the company's
profitability and cash flow generation ability.
The stable outlook on the foreign currency rating stems from S&P's
current views on transfer and convertibility risk in Argentina.
PAUL ATHAS: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Paul Athas
6501 McCormick Ranch
Plano, Texas 75023
Bankruptcy Case No.: 05-33778
Chapter 11 Petition Date: April 4, 2005
Court: Northern District of Texas (Dallas)
Debtor's Counsel: Eric A. Liepins, Esq.
Eric A. Liepins, P.C.
12770 Coit Road, Suite 1100
Dallas, Texas 75251
Tel: (972) 991-5591
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
The Debtor did not file a list of its 20 Largest Unsecured
Creditors.
PEPPERCORN INC: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Peppercorn, Inc.
dba Bai Thong Thai Seafood Restaurant
1257 Highland Avenue
Needham, Massachusetts 02492
Bankruptcy Case No.: 05-12540
Chapter 11 Petition Date: March 30, 2005
Court: District of Massachusetts (Boston)
Judge: Robert Somma
Debtor's Counsel: Leonard Ullian, Esq.
The Law Office Of Ullian & Associates
220 Forbes Road, Suite 106
Braintree, Massachusetts 02184
Tel: (781) 848-5980
Total Assets: Unknown
Total Debts: Unknown
The Debtor did not file a list of its 20 Largest Unsecured
Creditors.
PNC MORTGAGE: Moody's Affirms Six Low-B Rated Certificate Classes
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of six classes and
affirmed the ratings of nine classes of PNC Mortgage Acceptance
Corp., Commercial Mortgage Pass-Through Certificates,
Series 2000-C2 as:
--Class A-1, $109,188,458, Fixed, affirmed at Aaa
--Class A-2, $619,916,000, Fixed, affirmed at Aaa
--Class X, Notional, affirmed at Aaa
--Class B, $43,044,000, Fixed, upgraded to Aaa from Aa2
--Class C, $48,423,000, Fixed, upgraded to Aa3 from A2
--Class D, $13,452,000, Fixed, upgraded to A1 from A3
--Class E, $13,451,000, WAC, upgraded to A2 from Baa1
--Class F, $18,831,000, WAC, upgraded to Baa1 from Baa2
--Class G, $16,141,000, WAC, upgraded to Baa2 from Baa3
--Class H, $18,832,000, Fixed, affirmed at Ba1
--Class J, $29,592,000, Fixed, affirmed at Ba2
--Class K, $8,071,000, Fixed, affirmed at Ba3
--Class L, $8,071,000, Fixed, affirmed at B1
--Class M, $10,761,000, Fixed, affirmed at B2
--Class N, $5,380,000, Fixed, affirmed at B3
As of the March 14, 2005 distribution date, the transaction's
aggregate balance has decreased by approximately 8.5% to
$984.2 million from $1.1 billion at closing. The Certificates are
collateralized by 170 mortgage loans secured by commercial and
multifamily properties. The loans range in size from less than
1.0% to 5.9% of the pool, with the top 10 loans representing 32.1%
of the pool. Five loans, representing 9.0% of the pool, have
defeased and have been replaced by U.S. Government securities.
The largest defeased loans include the second largest loan, Camino
Real Marketplace ($48.1 million - 4.9%) and the fifth largest
loan, Bozzuto's Warehouse and Distribution Facility ($31.9 million
- 3.2%). One loan has been liquidated from the pool, resulting in
a realized loss of approximately $485,000.
Four loans, representing 4.6% of the pool, are in special
servicing. Moody's is not estimating any losses from the
specially serviced loans at this time. Thirty-three loans,
representing 28.7% of the pool, are on the master servicer's
watchlist.
Moody's was provided with year-end 2003 operating results for
100.0% of the performing loans and partial year 2004 operating
results for 93.0% of the performing loans. Moody's loan to value
ratio is 84.3%, essentially the same as at securitization. Based
on Moody's analysis, 7.4% of the pool has a LTV greater than
100.0%, compared to 0.9% at securitization. The upgrade of
Classes B, C, D, E, F and G is due to increased subordination
levels and stable overall pool performance.
The top three loans represent 13.9% of the outstanding pool
balance. The largest loan in the pool is the 475 Park Avenue
South Loan ($58.1 million - 5.9%), which is secured by a
409,000 square foot office building located in midtown submarket
of New York City. The property has experienced a decline in
occupancy and increased expenses since securitization. Occupancy
is 86.0%, compared to 96.0% at securitization. The largest
tenants are Valerie Wilson Travel (10.7% NRA; expiration May 2007)
and the New York Department of Education (7.3% NRA; expiration
June 2010). The property is on the master servicer's watchlist
due to a debt service coverage ratio ("DSCR") below 1.10x.
Moody's LTV is 83.6%, compared to 76.0% at securitization.
The second largest loan is the Courtyard by Marriott Loan
($42.6 million - 4.3%), which is secured by a 244-room limited
service hotel located in New York City. Occupancy and RevPAR for
trailing 12 month period ending December 2004 were 91.4% and
$197.90, respectively, compared to 92.1% and $187.90 at
securitization. The loan is on the master servicer's watchlist
due to a DSCR decline in 2003. DSCR improved in 2004 due to
improved property performance. Moody's LTV is 76.8%, compared to
77.9% at securitization.
The third largest loan is the AppleTree Business Park Loan
($36.0 million - 3.7%), which is secured by a 435,000 square foot
office complex located in Cheektowaga, New York, a suburb of
Buffalo. The property's performance has declined since
securitization due to a decline in occupancy. The property is
79.0% occupied, compared to 96.2% at securitization. Major
tenants include Government Services Administration/IRS (20.9% NRA;
expiration December 2005) and M&T Trust (12.2% NRA; expiration
May 2010). The loan is on the master servicer's watchlist due to
a DSCR decline. Moody's LTV is 92.3%, compared to 86.0% at
securitization.
The pool's collateral is a mix of:
1. office (29.0%);
2. retail (27.6%);
3. multifamily (18.5%);
4. U.S. Government securities (9.0%);
5. lodging (8.9%);
6. industrial and self storage (6.6%); and
7. other (0.4%).
The collateral properties are located in 35 states plus
Washington, D.C.
The highest state concentrations are:
1. New York, (27.6%);
2. California (13.0%);
3. Maryland (5.9%);
4. Arizona (5.8%); and
5. Michigan (5.3%).
All of the loans are fixed rate.
PROXYMED: Inability to Pay Debt When Due Spurs Going Concern Doubt
------------------------------------------------------------------
Deloitte & Touche LLP has expressed doubt about ProxyMed, Inc.'s
(Nasdaq:PILL) ability to continue as a going concern after
reviewing the company's 2004 financial statements. The Company's
auditors raised substantial doubt about the Company's ability to
continue as a going concern due to the Company's potential
inability to pay certain current debt obligations when due.
ProxyMed filed its Form 10-K for the fiscal year ended December
31, 2004 on March 17, 2005 (as amended by a Form 10-K/A filed on
March 31, 2005).
As discussed in the Company's March 15, 2005, earnings conference
call, the Company has executed a non-binding term sheet to expand
its present credit facility. The Company expects to repay the
related party debt due on May 31, 2005, with proceeds from its
expanded credit facility.
The Company is currently negotiating financing with Wachovia Bank,
N.A. to provide funds to be used, with existing cash balances, to
make the May 31, 2005, $17.8 million balloon payment to PVC
Funding Partners, LLC, a related party.
A full-text copy of ProxyMed's Annual Report filed under Form 10-K
with the Securities and Exchange Commission is available for free
at:
http://www.sec.gov/Archives/edgar/data/906337/000095014405003298/x93787ae10vkza.htm
About the Company
ProxyMed provides connectivity, medical cost containment services,
business process outsourcing solutions and related value-added
products to physicians, payers, pharmacies, medical laboratories,
and other healthcare providers and suppliers. ProxyMed's services
support a broad range of both financial and clinical transactions,
and we are HIPAA certified through Edifecs. To facilitate these
services, ProxyMed operates Phoenix(TM), our secure national
electronic information platform, which provides physicians and
other primary care providers with direct connectivity to payers,
chain and independent pharmacies and clinical laboratories.
RADIANT ENERGY: Equity Deficit Widens to $10.2 Million at Jan. 31
-----------------------------------------------------------------
Radiant Energy Corporation (TSX VENTURE:RDT) filed its financial
statements and Management Discussion and Analysis for the three
months ended January 31, 2005.
As of January 31, 2005, Radiant Energy's equity deficit widened to
$10,236,519 compared to a $10,044,933 deficit at October 31, 2004.
The Company has incurred significant losses and negative cash flow
from operations in each of the last two years and has an
accumulate deficit from operations of $22,467,317 at January 31,
2005 [October 31, 2004 - $22,043,448] and has reduced operations.
Due to a working capital deficiency of $10,448,047 [October 31,
2004 - $10,265,399] and defaults on various debt instruments, the
Company's ability to continue as a going concern is in substantial
doubt and is dependent upon achieving a profitable level of
operations and obtaining additional financing, neither of which is
assured.
The Company recorded a ($432,869) loss for the three months ended
January 31, 2005 compared to a ($254,626) loss for the three
months ended October 31, 2004. The increase in the loss from the
quarter ended January 31, 2005, was affected by the recognition of
stock options issued in the quarter and recognition of a loan
bonus of warrants issued in the quarter.
Revenue
For the three months ended January 31, 2005, revenue decreased to
$21,550 from $53,050 in 2004. The Company's revenue was generated
from the InfraTek System 2000 installed at the Newark Liberty
International Airport. The decrease in revenue resulted from
milder weather and a change in the customer's management team at
Newark. Radiant has not introduced the benefits of InfraTek
deicing to the new management team, but plans to do so in 2005.
Cost of sales For the three months ended January 31, 2005, there
was no cost of sales compared to an expense of $14,087 for 2004.
For the quarter ended October 31, 2004, the Company received a
rebate for expenses related to the utility contract at Newark. In
2003, the reflectors in the heating units were replaced. During
2000 and 2002, a significant level of construction near the
deicing facility caused dirt to accumulate on the reflectors. The
expense in 2004 represents the final amounts paid by BCC. The
repair costs were paid by BCC and added to the Lease Settlement
Loan.
Marketing Expenses
Marketing expenses for the three months ended January 31, 2005,
increased to $107,590 from $58,456 in 2004. The increased cost
resulted from the recognition of stock-based incentive programs of
$34,962 and the Company added one full time sales person and one
part-time sales person for an increase of $25,000.
General and Administrative Expenses
General and administrative expenses for the three months ended
January 31, 2005, were $106,385 compared to $74,757 for the same
period in 2004. The increased cost primarily resulted from the
recognition of stock-based incentive programs in 2004 of $18,180.
Loss on Foreign Exchange
During the quarter ended January 31, 2005, the Company experienced
a foreign currency loss of $33,751 compared to a loss of $17,794
during the quarter ended January 31, 2004. The Company reports in
US dollars. The foreign currency losses resulted from the
negative effect the increase in value of the Norwegian Krone (NOK)
versus the US dollar had on accounts payable denominated in NOK
and from an increase in value of the Canadian dollar versus the US
dollar.
Engineering Expense
For the three months ended January 31, 2005, engineering expenses
were $33,040 compared to $32,935 for the same period in 2004.
Amortization of property and equipment Depreciation for the three
months January 31, 2005 decreased to $2,065 from $3,302 in 2004.
The decrease resulted from fixed assets becoming fully
depreciated. The expense is expected to increase in the future as
the Company replaces old assets and expands.
Amortization of Patents
Amortization of patents for the three months ended January 31,
2005 and 2004 was $6,873.
Amortization of Interest Bonus
For the three months ended January 31, 2005, the Company recorded
an expense for interest bonus of $30,680 compared to nil in 2004.
In November 2004, the Company obtained a line-of-credit to a
maximum $415,420 [$500,000 Canadian] from a private corporation
based in Ontario controlled by an existing shareholder of Radiant.
The line-of-credit is repayable on demand, is not secured by the
assets of the Company and bears an interest rate equal to 2.5% per
month.
The Company granted an interest bonus to issue a maximum of
400,000 warrants to purchase 400,000 common shares at $0.08 [$0.10
Canadian] per common share. An Interest bonus of The Series E
warrants will be issued on a proportional basis to the principal
amounts advanced to the Company. The warrants were valued using
the Black Scholes model and the value of the warrants issued was
expensed. As at January 31, 2005, $222,132 [$275,000 Canadian]
has been drawn on the line-of-credit and 220,000 warrants were
issued. Although the interest rate appears high at 30% per annum,
the loan was expected to be outstanding for only a short period of
time. To the lender the risk was the same as a loan with an
extended duration, but the interest revenue was expected to be
less. The loan will be repaid from the proceeds of the Series D
Debentures or from payments from the contract with JFK.
Interest Expense
For the three months ended January 31, 2005, interest expense was
$107,590 compared to $99,472 for the same period in 2004. The
increase in interest expense in the quarter ended January 31,
2005, over the previous year's quarter resulted from the issuance
of Series B and C debentures during the fiscal year ended October
31, 2004 and due to interest related to the short-term credit
facility obtained in November 2004.
For the three months ended January 31, 2005 the Company's working
capital deficiency increased to $10,448,047 from $10,265,399 on
October 31, 2004. The working capital deficiency increased
primarily due to the fact that the operating loss incurred during
the period was only partially offset by the raising of new equity.
Cash decreased to an overdraft of $1,531 on January 31, 2005, from
a cash balance of $6,062 on October 31, 2004.
Outlook
Management is focused on recovery and change:
* recovery of our financial position and our market position;
* change with respect to the way the company approaches the
market place and to the way the company allocate its precious
financial and human resources and change with respect to the
way the company finances projects.
The company's outlook is uncertain due to the multitude and
magnitude of the business risk facing the Company. However,
management, employees and others associated with Radiant are
confident that Radiant has a compelling solution that meets a
growing need in the aviation industry and all are committed to the
success of the business. Management believes the contract at JFK
will signal the re-vitalization of the market introduction of the
InfraTek deicing product. The installation at JFK will be a
platform to demonstrate the economic and environmental benefits of
InfraTek deicing to the international airlines expected to use the
facility.
Financial Objectives
The Company is currently in the implementation phase of a plan to
change the debt and equity structure of the balance sheet. The
major targets of the financial plan are:
1. Raise cash for working capital and to finance the
construction at Oslo through the issuance of a Series D
Convertible Debenture;
2. Conversion of principal and accrued interest of the Series
A, B, and C unsecured convertible dentures;
3. Conversion of principal and accrued interest of the 9%
Secured Long-term Loan;
4. Re-negotiation of the terms of the Lease Settlement Loan
with GE Capital; and,
5. Negotiate and payout old accounts payable.
The Company is working diligently to achieve its financial
targets. Unfortunately at the time of this report the expected
gross proceeds of the Series D Convertible Debenture is not known.
The private placement is expected to close no later than April 14,
2005. The goal of US$7,000,000 is achievable, but the certainty
is not known at this time. Management believes that the gross
proceeds are expected to be approximately US$3,000,000. If the
Company raises less than US$5,000,000 the Company will seek
additional financing for the Oslo project.
The success of the plan to convert the Series A, B and C
debentures is partially contingent on the success of the Series D
Convertible Debenture. Some holders of the Series A, B and C
Debentures have indicated their willingness to convert their
debentures if the private placement of the Series D debentures is
moderately successful. The 9% Secured Convertible Term Loans are
held by three significant shareholders of Radiant. The three
lenders have agreed to convert the loans and accrued interest to
common shares provided the forced conversion clause and the
default provisions in the Series D Debentures do not create a
significant risk to Radiant. At this time the forced conversion
clause and the default provisions are not finalized. The Company
is in negotiations with GE Capital to change the terms of the
Lease Settlement Loan. No changes to the existing terms of the
loan are agreed to at this time. Management believes with a
moderately successful private placement of the Series D
Debentures, the Company will succeed in negotiating favorable
terms contained in the Lease Settlement Loan.
Subsequent to January 31, 2005, the Company signed debt settlement
agreements with 14 creditors representing US$137,995.07 in debt to
settle the debt for US$31,039.72. The Company would like to enter
debt settlement agreements with 5 additional creditors
representing US$400,000 of debt.
Management Changes
To facilitate the implementation of the financial and sales plan
the Company needs to hire people. On February 9, 2005, The Board
of Directors appointed Mr. John Gillberry as Interim President and
Chief Executive Officer. Mr. Gillberry will oversee the
operations of the Company and facilitate the implementation of the
Private Placement. Upon completion of the Private Placement of
the Series D Debentures Mr. Gillberry will be appointed President
and Chief Executive Officer. Mr. Colin Digout will continue his
duties as Chief Financial Officer of the Company. Among other
duties Mr. Gillberry will oversee the expansion of sales and other
staff of the Company.
Under the terms of the agreement with the Broker of the proposed
Series D secured debenture private placement, the existing three
Directors will resign and a new Board will be appointed.
Management and the new Board will call a shareholders meeting and
propose an expansion of the number of Directors from three to five
and propose a slate of Directors. The existing Board and
management are actively seeking candidates to join the Board.
About the Company
Radiant Energy Corporation, through its wholly owned subsidiary
Radiant Aviation Services developed and sells the world's only
infrared alternative to traditional glycol-based aircraft deicing.
Its fully patented InfraTek(R) systems are approved for use by the
FAA. Prior to the introduction of InfraTek, spraying with glycol
was the only feasible method to satisfy FAA safety guidelines for
ensuring that aircraft are properly deiced prior to take-off.
Securities of Radiant Energy Corporation trade on the TSX Venture
Exchange (symbol RDT). There are currently 33,550,774 common
shares outstanding.
RELIANCE GROUP: Wants Court to Overrule Deloitte's Objection
------------------------------------------------------------
As reported in the Troubled Company Reporter on March 4, 2005, the
Official Unsecured Bank Committee and the Official Unsecured
Creditors' Committee for the estates of Reliance Group Holdings,
Inc., and Reliance Financial Services Corporation, and the
Debtors ask Judge Gonzalez of the United States Bankruptcy Court
for the Southern District of New York to approve a Settlement
Agreement that resolves all outstanding disputes between Reliance
Insurance Company and its former Officers and Directors.
Deloitte Responds
Reliance Insurance Company's outside auditor, Deloitte & Touche
LLP, and its appointed actuary, Jan A. Lommele, do not oppose a
settlement of the D&O Litigation but they want to preserve their
right to raise an issue with the Liquidator.
Geoffrey A. Kahn, Esq., at Ballard, Spahr, Andrews & Ingersoll,
in Philadelphia, Pennsylvania, tells the Pennsylvania
Commonwealth Court that during settlement negotiations, Deloitte
objected to certain provisions of the Proposed Order. In an
attempt to find an amicable resolution, Mr. Kahn wrote to the
Liquidator's counsel on March 4, 2005, seeking to:
1) clarify whether the Release satisfied the requirements of
a "Griffin-type Joint Tortfeasor Release"; and
2) preserve Deloitte's right to challenge the holding of
Charles v. Giant Eagle Markets, 513 Pa. 474, 522 A.2d 1
(1987), on which the Release and Bar Order are based.
According to Mr. Kahn, the Liquidator resolved the Griffin issue
to Deloitte's satisfaction. However, the Liquidator declined to
accommodate Deloitte's position related to the Charles decision.
Pursuant to the proposed Bar Order, any damages recoverable in
the Deloitte Action from Non-Settling Defendants will be reduced
by the sum of the individual pro rata shares of the Releasees'
liability, rather than by the consideration paid for the Release,
if greater. This contradicts the language of the Uniform
Contribution Among Tortfeasors Act, 42 Pa.C.S. Section 8326,
argues Mr. Kahn.
The Commonwealth Court need not decide the Charles issue at this
time, Mr. Kahn says, since it is not ripe. "The issue will be
ripe only if the consideration paid for the Release is greater
than the aggregate pro rata liability of the Releasees, as
determined at trial." For now, Mr. Kahn says, Deloitte merely
wants to preserve its right to challenge the Charles holding, and
the method by which any verdict or judgment is reduced, if it
becomes ripe. As a result, Deloitte asks Judge James G. Colins
to add this proviso to the proposed Order:
"provided, however, that if the issue becomes ripe, the
Deloitte Defendants shall have the right to challenge the
holding of Charles v. Giant Eagle Markets that the damages
recoverable from non-settling defendants are reduced only by
the aggregate pro rata share of releasees' liability, rather
than by the greater of the amount of consideration paid for
the joint tortfeasor release or the releasees' pro rata
share of liability."
Overrule Deloitte's Objection,
RIC Liquidator Says
M. Diane Koken, Insurance Commissioner of the Commonwealth of
Pennsylvania and Liquidator of Reliance Insurance Company, points
out that the Settlement was negotiated over many months under the
auspices of a Court-appointed mediator. The Settlement is a
legally enforceable agreement consistent with Pennsylvania law,
under which the Liquidator will provide the D&O Defendants with a
release consistent with Pennsylvania case law, as interpreted by
the Griffin and Charles decisions. The Settlement will provide
the Liquidator with the opportunity to collect from Deloitte its
pro rata share of liability, as determined by a jury, even if
this amount is less than that of the D&O Defendants.
Jerome B. Richter, Esq., at Blank Rome, in Philadelphia, says
that the matter is not even ripe for adjudication. Mr. Richter
points out that Deloitte admits that this issue will not be ripe
until after trial, if at all. "This dooms the Objection, as
courts cannot consider requests for opinions or rulings of
hypothetical matters. Instead, a case or controversy must
exist."
Mr. Richter contends that Deloitte is trying to undermine the
finality of the Settlement reached after a Court-sponsored
mediation. Deloitte wants to preserve a legally unsupportable
benefit related to the D&O Settlement, Mr. Richter says, and that
is to be excused from paying what a jury determines it should pay
on account of its own wrong. As a matter of policy, Mr. Richter
argues, courts should not allow defendants to pay less than
determined by juries. "Such a policy would discourage
recalcitrant defendants from settling." Deloitte must be held
for its full proportionate share of liability, Mr. Richter
asserts.
Mr. Richter relates that the Court in Charles v. Giant Eagle
Markets, 513 Pa. 474, 522 A.2d 1 (1987), held that:
-- The respective obligations of the parties to a lawsuit can
be finally determined either by way of a bona fide
settlement or through trial. The Commonwealth has a strong
public policy which favors settlement.
-- The inducements for a defendant to settle are the certainty
of the agreed-upon obligation and the avoidance of the
vagaries of trial.
-- There is no precise measure of the amount of wrong. Even
if the trial is as to damages only, successive juries would
rarely make the identical appraisal. Nor is there reason
to suppose that the jury's evaluation of losses is more
accurate than the evaluation made by the parties to the
settlement. Surely where liability is contested, the
verdict may not reflect the exact worth of the injuries.
When the cost of litigation is taken into account, it
becomes still more difficult to say that enforcement of the
judgment debtor's pro rata liability would enrich the
plaintiff.
According to Mr. Richter, Deloitte is asking the Court to
preserve its right to strip away its obligation to pay for its
pro rata share of the liability. "This benefit was bargained-for
by the Liquidator and any compromise would interject an element
of uncertainty into the Settlement, undermining the Liquidator's
ability to collect sums for policyholders."
Thus, the Liquidator asks the Pennsylvania Commonwealth Court to
overrule Deloitte's objection.
Deloitte Insists on Preserving its Right
Before filing its Objection, Mr. Kahn relates, Deloitte tried to
simply and inexpensively preserve its right to challenge the
holding in Charles v. Giant Eagle. According to Mr. Kahn,
Deloitte asked the Liquidator to preserve the Charles issue until
it is ripe to obviate the argument that Deloitte waived its
rights by remaining silent while the Court considered the Bar
Order. Unfortunately, Mr. Kahn says, "the Liquidator refused to
resolve the issue in this common-sense manner."
Mr. Kahn emphasizes that Deloitte is not making large-scale
requests to the Court. "For example, Deloitte is not seeking to
alter the amount of money that the Liquidator will receive from
the D&O Settlement. That amount was agreed to between the
Liquidator and the Directors and Officers. No matter how the
Charles issue is resolved, if it ever becomes ripe, the
Liquidator's recovery will not be altered by one penny. Nor is
Deloitte challenging the viability of the D&O Settlement. Under
the bargained-for Settlement, the Directors and Officers will pay
a certain amount of money, and, in return, they will be released
from the litigation."
The Settlement does not give the Liquidator an expectancy
interest in any amount recovered from Deloitte, Mr. Kahn notes.
"The Liquidator may only expect to proceed against Deloitte in
accordance with the law. The Liquidator's complaint that
Deloitte's [request] will upset the bargained-for Settlement, is
really an admission that the parties to the Settlement have
bargained away Deloitte's rights under the Uniform Contribution
Among Tortfeasors Act, 42 Pa. C.S. Section 8326." Mr. Kahn
argues that settling parties may not bargain away the statutory
rights of non-settling parties.
Deloitte and the Liquidator agree that a challenge to the holding
in Charles is not ripe, but Deloitte must now preserve its right
to do so. Mr. Kahn says that the proposed Bar Order and Joint
Tortfeasor Release would take the Charles holding -- that pro
rata reduction applies even if pro tanto would be greater -- and
make it binding. If Deloitte failed to advance this issue, Mr.
Kahn says, the Liquidator would argue that Deloitte implicitly
agreed to accept a pro rata reduction that is lower than a pro
tanto reduction. Deloitte will not take the chance of losing
that argument, Mr. Kahn says.
Mr. Kahn tells the Pennsylvania Commonwealth Court that this
debate is unnecessary and an unfortunate waste of RIC's assets.
"If the Liquidator had merely agreed to preserve Deloitte's right
to challenge [the holding in] Charles, there would be no need to
spend money litigating an issue that may never need to be
adjudicated."
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 Insurance Company.
The holding and intermediate finance companies filed for chapter
11 protection on June 12, 2001 (Bankr. S.D.N.Y. Case No. 01-13403)
listing $12,598,054,000 in assets and $12,877,472,000 in debts.
The insurance unit is being liquidated by the Insurance
Commissioner of the Commonwealth of Pennsylvania. (Reliance
Bankruptcy News, Issue No. 69; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
SAFETY-KLEEN: Oaktree Files Class Action Suit in South Carolina
---------------------------------------------------------------
Grant & Eisenhofer, P.A. has filed a securities fraud class action
lawsuit in the United States District Court for the District of
South Carolina, on behalf of OCM High Yield Trust, OCM High Yield
Limited Partnership and OCM High Yield Fund II, L.P., as well all
other funds and accounts which are managed by Oaktree Capital
Management, LLC. These funds purchased or acquired 9-1/4% senior
notes due in 2008 issued by Laidlaw Environmental Services, Inc.,
the predecessor to Safety-Kleen Corp., in the initial offering
and/or on the secondary market from May 1, 1998 through
March 6, 2000.
This complaint is related to a current class action entitled In re
Safety-Kleen Bondholders Litigation, Consol. Case No. 3-00-1145,
pending in the United States District Court for the District of
South Carolina. The class in that action is certified with
respect to claims under the Securities Act of 1933 but has been
decertified with respect to claims under the Securities Exchange
Act of 1934. The OCM Funds seeks to recover damages under the
Exchange Act on behalf of themselves and other funds and accounts
managed by Oaktree.
The Complaint alleges that on March 6, 2000, Safety-Kleen
announced that it had uncovered material "accounting
irregularities" in its financial reports, leading it to place its
three top executives on leave while a Special Committee appointed
by Safety-Kleen's Board of Directors conducted an internal
investigation. The value of the Bonds plunged dramatically in
response to this announcement. At the conclusion of the
investigation, the Company issued restated financial statements
for the years ended August 31, 1997, 1998 and 1999, which
collectively reduced the company's net income by more than $530
million.
If you own an account managed by Oaktree which purchased or
acquired 2008 Bonds from May 1, 1998 through March 6, 2000, you
may request that the Court appoint you as lead plaintiff. A lead
plaintiff is a person who acts on behalf of other class members in
directing the litigation. Any member of the proposed Oaktree
Class who wishes to move the Court to serve as lead plaintiff must
do so no later than sixty days from today's date.
If you have any questions concerning this notice or your rights or
interests, please contact Kimberly L. Wierzel with Grant &
Eisenhofer, P.A. at 302-622-7024 or by e-mail at
kwierzel@gelaw.com
Headquartered in Delaware, Safety-Kleen Corporation --
http://www.safety-kleen.com/-- provides specialty services such
as parts cleaning, site remediation, soil decontamination, and
wastewater services. The Company, along with its affiliates,
filed for chapter 11 protection (Bankr. D. Del. Case No. 00-02303)
on June 9, 2000. Gregg M. Galardi, Esq., at Skadden, Arps, Slate,
Meagher, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $3,031,304,000 in assets and $3,333,745,000 in liabilities.
(Safety-Kleen Bankruptcy News, Issue No. 86; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
SEARS HOLDINGS: Owns 100% of Sears Canada After Kmart Merger
------------------------------------------------------------
Sears Canada Inc. (TSX: SCC) disclosed a change in ownership of
its controlling shareholder resulting from the recent merger
transactions involving Sears, Roebuck and Co. and Kmart Holding
Corporation, which formed Sears Holdings Corporation (Nasdaq:
SHLD). Sears, Roebuck, the owner of approximately 54.3% of the
issued and outstanding shares of Sears Canada, is now a wholly
owned subsidiary of Sears Holdings.
The merger transactions were completed on March 24, 2005. Sears
Holdings is now the third largest retailer in the United States,
with approximately U.S. $55 billion in annual revenues and nearly
3,500 retail stores, including 2,350 full-line and off-mall
stores, and 1,100 specialty retail stores.
About Sears Holdings Corporation
Sears Holdings Corporation -- http://www.searshc.com/-- is the
nation's third largest broadline retailer, with approximately $55
billion in annual revenues, and with approximately 3,800 full-line
and specialty retail stores in the United States and Canada.
Sears Holdings is the leading home appliance retailer as well as a
leader in tools, lawn and garden, home electronics and automotive
repair and maintenance. Key proprietary brands include Kenmore,
Craftsman and DieHard, and a broad apparel offering, including
such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer,
as well as the Apostrophe and Covington brands. It also has
Martha Stewart Everyday products, which are offered exclusively in
the U.S. by Kmart and in Canada by Sears Canada.
* * *
As reported in the Troubled Company Reporter on March 31, 2005,
Moody's Investors Service affirmed the Ba1 senior implied rating
of Sears Holding Corporation. Moody's said the rating outlook is
stable.
Ratings assigned:
Sears Holdings Corporation
* Senior implied rating at Ba1;
* Senior unsecured issuer rating at Ba1; and
* $4 billion senior secured revolving credit facility
at Baa3.
As reported in the Troubled Company Reporter on March 30, 2005,
Fitch Ratings assigned a 'BB' rating to Sears Holdings senior
unsecured debt, with a negative outlook.
At the same time, Standard & Poor's assigned its 'BB+' corporate
credit rating to Sears Holdings, with a negative outlook.
SEARS HOLDINGS: Competition Bureau Fines Canadian Unit $487,000
---------------------------------------------------------------
The Competition Bureau reported that Sears Canada Inc., a wholly
owned subsidiary of Sears Holdings Corporation following a merger
with Kmart, was ordered to pay a $100,000 administrative monetary
penalty as well as $387,000 towards the Competition Bureau's legal
costs, for a total of $487,000, under the Competition Act's
Deceptive Marketing Practices provisions.
This order follows the Competition Tribunal's January decision
that Sears breached the Act by making false or misleading
representations regarding savings available to consumers when they
advertised discounts on certain tires across Canada. The
Tribunal's order also prohibits the automotive business division
of Sears from engaging in similar representations for a period of
10 years.
Sears agreed to pay the $100,000 administrative monetary penalty
and costs in a joint submission to the Competition Tribunal, the
maximum penalty that can be imposed on a corporation following an
initial finding of reviewable conduct. Parliament is currently
considering amendments to the Act which would significantly
increase the penalties to better deter similar deceptive marketing
practices.
"This kind of deceptive marketing practice hurts consumers,
business competitors and competition," said Raymond Pierce, Deputy
Commissioner of Competition. "Consumers deserve the truth about
prices advertised by retailers."
The Competition Bureau is an independent law enforcement agency
that promotes and maintains fair competition so that all Canadians
can benefit from competitive prices, product choice and quality
service. It oversees the application of the Competition Act, the
Consumer Packaging and Labelling Act, the Textile Labelling Act
and the Precious Metals Marking Act.
About Sears Canada
Sears Canada is a multi-channel retailer with a network of 122
full-line department stores, 218 off-mall stores, 64 home
improvement showrooms, over 2,200 catalogue merchandise pick-up
locations, 113 Sears Travel offices and a nationwide home
maintenance, repair, and installation network. The Company also
publishes Canada's most extensive general merchandise catalogue
and offers shopping online at http://www.sears.ca/
About Sears Holdings
Sears Holdings Corporation -- http://www.searshc.com/-- is the
nation's third largest broadline retailer, with approximately
$55 billion in annual revenues, and with approximately 3,800 full-
line and specialty retail stores in the United States and Canada.
Sears Holdings is the leading home appliance retailer as well as a
leader in tools, lawn and garden, home electronics and automotive
repair and maintenance. Key proprietary brands include Kenmore,
Craftsman and DieHard, and a broad apparel offering, including
such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer,
as well as the Apostrophe and Covington brands. It also has
Martha Stewart Everyday products, which are offered exclusively in
the U.S. by Kmart and in Canada by Sears Canada.
* * *
As reported in the Troubled Company Reporter on March 31, 2005,
Moody's Investors Service affirmed the Ba1 senior implied rating
of Sears Holding Corporation. Moody's said the rating outlook is
stable.
Ratings assigned:
Sears Holdings Corporation
* Senior implied rating at Ba1;
* Senior unsecured issuer rating at Ba1; and
* $4 billion senior secured revolving credit facility
at Baa3.
As reported in the Troubled Company Reporter on March 30, 2005,
Fitch Ratings assigned a 'BB' rating to Sears Holdings senior
unsecured debt, with a negative outlook.
At the same time, Standard & Poor's assigned its 'BB+' corporate
credit rating to Sears Holdings, with a negative outlook.
SHAW GROUP: Commencing Tender Offer for 10-3/4% Senior Notes
------------------------------------------------------------
The Shaw Group Inc. (NYSE:SGR) plans to commence a tender offer on
April 5, 2005, for all of its outstanding 10-3/4% Senior Notes due
2010 with a total principal amount outstanding of approximately
$250 million. The total consideration to be offered in the tender
will be $1,146.81 per $1,000 note. The total consideration
includes a consent payment of $25 per $1,000 principal amount of
Senior Notes payable only to Holders who tender their Senior Notes
and deliver their consents to the proposed amendments to the
indenture governing the Senior Notes during the consent period and
prior to the consent time.
Holders who tender their Senior Notes after the consent time and
prior to the expiration time will be entitled to receive the total
consideration less the $25 consent payment per $1,000 principal
amount of the Senior Notes on the final settlement date for the
Senior Notes. In addition, we will pay accrued and unpaid
interest on such $1,000 principal amount of Senior Notes up to,
but not including, the payment date for Senior Notes accepted for
purchase. The consent period will expire on April 19, 2005, and
the Offer will expire on May 4, 2005. Shaw intends to fund the
repurchase with proceeds from a proposed offering of 12.5 million
shares of common stock together with additional funds. Assuming
all Senior Notes are tendered and accepted by the company at the
offer price, we will recognize a loss on the repurchase of the
Senior Notes, net of income taxes, of approximately $30.6 million
in the third quarter of fiscal 2005.
UBS Securities LLC will act as dealer manager and solicitation
agent, D.F. King & Co., Inc. will be the information agent and The
Bank of New York will serve as the tender agent in connection with
the Offer.
The Shaw Group Inc. -- http://www.shawgrp.com/-- is a global
provider of technology, engineering, procurement, construction,
maintenance, fabrication, manufacturing, consulting, remediation,
and facilities management services for government and private
sector clients in the power, process, environmental,
infrastructure and emergency response markets. A Fortune 500
Company, The Shaw Group is headquartered in Baton Rouge,
Louisiana, and employs approximately 18,000 people at its offices
and operations in North America, South America, Europe, the Middle
East and the Asia-Pacific region.
* * *
As reported in the Troubled Company Reporter on Dec. 8, 2004,
Standard & Poor's Ratings Services lowered its corporate credit
rating on The Shaw Group to 'BB-' from 'BB.' Other ratings were
also lowered one notch. The outlook is negative. At
Aug. 31, 2004, the Baton Rouge, Louisiana-based engineering and
construction services provider had about $476 million total debt
outstanding (including present value of operating leases).
"The ratings downgrade reflects weak earnings quality and cash
flow generation that is more consistent with the lower rating,"
said Standard & Poor's credit analyst Paul Kurias. "Ratings may be
lowered further if liquidity were to decline meaningfully, which
might occur if operations underperform expectations or if
challenged projects require greater-than-expected resources to
complete."
SHAW GROUP: Earns $9.7 Million of Net Income in Second Quarter
--------------------------------------------------------------
The Shaw Group Inc. (NYSE:SGR) disclosed its financial results for
its second fiscal quarter.
Net income from continuing operations for the second quarter of
fiscal 2005 was $9.7 million. In comparison, for the three months
ended February 28, 2004, Shaw reported net income from continuing
operations of $2.5 million. For the second quarter of fiscal
2005, revenues were $763.5 million compared to $689.1 million in
the prior year's second quarter.
Shaw's backlog totaled $5.1 billion at February 28, 2005, with
approximately $2.4 billion, or 46% of the backlog expected to be
converted during the next 12 months. Approximately $2.6 billion,
or 50%, of the backlog is in environmental the and infrastructure
sector, primarily contracts with Federal government agencies and
commercial entities; approximately $1.8 billion, or 35%, of the
backlog is comprised of projects for energy industry customers,
primarily nuclear and fossil fuel power plants; and approximately
$0.7 billion, or 13%, related to projects for chemical process
industry facilities.
J.M Bernhard, Jr., Chairman and Chief Executive Officer of Shaw,
said, "We are pleased to report positive financial and operational
results for the fourth consecutive quarter, with net income from
continuing operations of $0.15 per diluted share and positive net
cash from operations of $18.3 million. This solid improvement is
a direct result of our continued focus on project execution and
improved efficiencies and a marked increase in activity related to
the recovering energy and chemical markets. While our total
backlog is sequentially lower this quarter, we have seen strong
momentum in preliminary engineering and design work for our energy
and chemical industry clients, especially in power generation and
chemical process sectors. We are also pleased with the steady
growth of our maintenance backlog and our strong position in the
federal services marketplace in the environmental and
infrastructure sector."
The Shaw Group Inc. -- http://www.shawgrp.com/-- is a global
provider of technology, engineering, procurement, construction,
maintenance, fabrication, manufacturing, consulting, remediation,
and facilities management services for government and private
sector clients in the power, process, environmental,
infrastructure and emergency response markets. A Fortune 500
Company, The Shaw Group is headquartered in Baton Rouge,
Louisiana, and employs approximately 18,000 people at its offices
and operations in North America, South America, Europe, the Middle
East and the Asia-Pacific region.
* * *
As reported in the Troubled Company Reporter on Dec. 8, 2004,
Standard & Poor's Ratings Services lowered its corporate credit
rating on The Shaw Group to 'BB-' from 'BB.' Other ratings were
also lowered one notch. The outlook is negative. At
Aug. 31, 2004, the Baton Rouge, Louisiana-based engineering and
construction services provider had about $476 million total debt
outstanding (including present value of operating leases).
"The ratings downgrade reflects weak earnings quality and cash
flow generation that is more consistent with the lower rating,"
said Standard & Poor's credit analyst Paul Kurias. "Ratings may be
lowered further if liquidity were to decline meaningfully, which
might occur if operations underperform expectations or if
challenged projects require greater-than-expected resources to
complete."
SP NEWSPRINT: Moody's Affirms B1 Rating on $280 Million Debt
------------------------------------------------------------
Moody's Investors Service affirmed the ratings of SP Newsprint
Company and changed the outlook to positive from stable.
The change in outlook is based on SP's improved operating
performance and declining debt, and Moody's expectation that
performance will continue to improve over the near to intermediate
term. Specifically, Moody's affirmed the B1 senior implied rating
and B3 senior unsecured issuer rating of SP. Moody's also
affirmed the B1 rating on the company's:
-- $145 million senior secured six-year Tranche B-2 term loan,
-- $80 million six-year senior secured Tranche B-1 term loan,
and
-- $55 million four-year senior secured revolving credit
facility.
Affirmation of the B1 senior implied rating reflects SP's improved
operating performance, due in part to the improved pricing
environment for newsprint over the last several quarters, and
lower debt levels. The ratings also reflect the company's
relatively low cash cost position when compared to others in the
industry, the direct and indirect support provided by its owners,
and adequate liquidity. However, the ratings also incorporate the
company's reliance on a single commodity product, newsprint, the
cyclical nature of newsprint prices, and the price volatility
associated with recycled material (ONP) and energy (natural gas),
which are key raw materials. The ratings also reflect the current
tenuous balance between industry supply and demand of newsprint,
the potential for idled capacity to be brought on-line, and the
fact that recent and expected price increases have been more
supply push rather than demand pull.
The change in outlook to positive from stable reflects Moody's
expectation that operating performance should continue to improve
and excess free cash flow will be applied to further debt
reduction. If SP is successful in further reducing debt from
current levels on a sustainable basis while maintaining its
current cost position, the ratings would likely improve. Factors
that could negatively impact the ratings or outlook would be an
inability to reduce debt due to stagnant or declining newsprint
prices or a significant increase in costs such as ONP or energy.
Over the past several quarters SP has benefited from an improved
pricing environment with market prices for standard newsprint of
about $580 per metric ton (tonne) at year end 2004 versus
approximately $520 per tonne in the same prior year period. For
the twelve months ended December 31, 2004, SP generated EBITDA of
approximately $60 million, free cash flow of $38, and reduced debt
by about $37 million. As a result, leverage on an adjusted debt
basis declined to approximately 4.1x and interest coverage
improved to over 4.5x.
Moody's views SP's liquidity as adequate and expects that over the
next twelve months the company will be able to fund all cash
requirements from internal sources, while maintaining full access
to its $55 million revolving credit facility. However, with
minimal cash balances and limited sources of alternate liquidity
any deterioration in anticipated cash flows could raise concerns.
In addition, Moody's views the level of capex in 2004 as
unsustainably low, and expect more normalized spending going
forward
Moody's remains concerned with the uncertainty of operating cash
flows that result from price volatility associated with a
commodity product and weak pricing that usually occurs at the
trough of a cycle. In 2002, newsprint prices were just below $450
per metric ton (tonne), the lowest since 1994. Despite improved
newsprint prices over the past several quarters, due in part to
the idling or conversion of approximately 2.84 million tonnes of
newsprint capacity by the larger newsprint producers and a slight
improvement in demand, pricing remains below historic peak levels.
Moreover, we believe further price increases over the near term
will be a challenge as significant excess capacity still exists,
and demand has remained relatively flat.
We also view competitive pressures from the market leaders with
substantially greater resources than SP as significant. Although
the market leaders are impacted by the same industry fundamentals,
in addition to foreign exchange issues, we believe they may have
greater flexibility in meeting the challenges in the market place
due to the scale of their operations and greater access to
alternate sources of liquidity.
Moody's recognizes that SP has mitigated to a certain degree, its
exposure to ONP pricing through recycling efforts of its SP
Recycling subsidiary and the agreement to purchase unsold
newspapers from its partners. The company should also benefit
from recent energy projects at its Newberg mill and the ability to
use alternate fuel sources in its operations. However, we believe
passing through higher prices for inputs such as ONP or natural
gas will remain difficult.
The ratings also incorporate the benefits provided by SP's
partners, Knight-Ridder Newspapers, Inc., Cox Enterprises Inc.,
and Media General Inc. The partner's help manage SP's inventory
levels by buying excess inventory to maintain operating rates,
provide a source of raw materials (ONP) by selling unsold
newspapers, are sizeable customers accounting for about 30% of
annual sales, and at various times have provided additional
liquidity. The partners usually provide about 40,000 tonnes of
alternate support annually to SP.
SP Newsprint Company, headquartered in Atlanta Georgia, is a
partnership among Cox Enterprises, Inc., Knight-Ridder Newspapers,
Inc. and Media General, Inc., that operates newsprint paper mills
that produce recycled newsprint.
SPIEGEL INC: Court Sets Plan Confirmation Hearing on May 25
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
scheduled a hearing to consider confirmation of Spiegel, Inc., and
its debtor-affiliates' Amended Plan of Reorganization for May 25,
2005, at 10:00 a.m., before the Hon. Burton R. Lifland.
The Court fixes May 13, 2005, as the deadline for filing Plan
Confirmation objections.
As reported in the Troubled Company Reporter on April 1, 2005, the
Debtors filed their amended Plan & Disclosure Statement to address
the majority of the objections to their Disclosure Statement. The
Debtors included in the Plan a detailed process for providing
notice of their intention to assume executory contracts and
unexpired leases and determine and resolve related cure payments.
The Debtors clarify in the Disclosure Statement that certain of
the non-debtor releases set forth in the Plan do not release the
claims asserted against the Debtors in the Federal Securities
Class Actions. The Debtors added an additional section to the
Disclosure Statement providing greater detail with respect to and
the rationale behind the share restrictions and escrow.
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. 42;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
SYRATECH CORP: Bankruptcy Court Approves Disclosure Statement
-------------------------------------------------------------
The United States Bankruptcy Court for the District of
Massachusetts has approved a disclosure statement for Syratech
Corp.'s proposed plan of reorganization. If confirmed, the
reorganization plan provides unsecured noteholders and certain
other creditors of Syratech with $55 million in new notes and 90%
of the reorganized company's equity. Ten percent of the equity of
the reorganized company will be reserved for management. The
ruling was made on March 30.
As previously announced, Syratech entered into a voluntary Chapter
11 bankruptcy filing on February 16, 2005, that will facilitate
the recapitalization of the company and provide increased
financial flexibility in its ongoing operations. Significant
portions of the plan were negotiated with an ad hoc committee of
Syratech's noteholders before the Chapter 11 filing.
The hearing on Syratech's reorganization plan is scheduled for
May 12, 2005. Under the terms of the plan, in addition to
conversion of certain debt into new debt and equity of the
reorganized Syratech, trade vendors and other creditors and
employees of the company generally are scheduled to be paid in
full in the normal course of the company's business. Also, under
the plan, current shareholders of Syratech will share in warrants
for 5% of the reorganized company's equity. The company is
currently operating with a $45 million revolving credit facility
from CapitalSource Finance LLC, a unit of Farallon Capital
Management LLC.
"With this ruling, the planned recapitalization of Syratech has
passed an important milestone. We anticipate a successful and
near-term outcome to this process," said Bob Meers, President and
CEO of Syratech.
Headquartered in Boston, Massachusetts, Syratech Corporation --
http://www.syratech.com/-- manufactures, markets, imports and
sells tabletop giftware and home decor products. The Debtor along
with its affiliates filed for chapter 11 protection on
Feb. 16, 2005 (Bankr. D. Mass. Case No. 05-11062). When the
Company filed for protection from its creditors, it listed
$86,845,512 in total assets and $251,387,015 in total debts.
TEMBEC INC: Plans to Buy & Operate St. Anne Nackawic Pulp Mill
--------------------------------------------------------------
The Aditya Birla Group of India and Tembec Inc. signed a Framework
Agreement with the Province of New Brunswick regarding the
acquisition of the St. Anne Nackawic pulp mill. The acquisition
will be made by a joint venture between Birla and Tembec in which
Birla will be the majority partner and Tembec the lead operator.
The Aditya Birla Group was represented by Mr. Sailendra K. Jain,
Director of Pulp and Fibre Business and Mr. P.M. Bajaj, Senior
Executive of the Aditya Birla Group. Tembec was represented by
Mr. Frank A. Dottori, President and Chief Executive Officer.
The announcement came after two weeks of intense negotiation
between a small team of senior New Brunswick officials and a
similar group representing the joint venture. The Provincial team
was lead by Rodney Weston, Chief of Staff for Premier Bernard
Lord. Dale Paterson, Executive Vice President and Chief Operating
Officer and Mr. S. V. Sharda, Vice President and CFO were the
senior AV Cell representatives.
"We are excited by the potential of not only expanding our
position in paper and specialty including dissolving pulps, but
also increasing our presence in the Province of New Brunswick,"
said Mr. Jain. "Our positive experience in Atholville has been
based on a solid partnership with Tembec, a well trained and
dedicated team in the mill and a positive and supportive business
climate here in New Brunswick. We see the same potential for the
Nackawic mill and look forward to working with the Province, the
community and the workforce to create a stable and competitive
site."
"Birla is also pleased to be furthering its relationship with
Tembec. Our experience with dissolving pulps and as a major
player in the global viscose staple fibre market will compliment
Tembec's proven abilities as a progressive and effective operator,
particularly relative to situations like we see in this case,"
said Mr. Jain.
Work would begin soon after closing of the transaction on the
conversion of the mill to allow it a product mix of paper,
dissolving and specialty pulps. This accelerated conversion,
along with the support and commitment of the Birla organization
were the primary drivers behind the change in position on the
Nackawic site by Tembec according to Frank Dottori, President and
CEO of Tembec.
"The presence and support of the Birla organization as a partner
in this facility was absolutely key in this change of position on
how Tembec views the restart of the mill. We have had an
extremely constructive and positive relationship with Birla at our
existing AV Cell partnership in Atholville" said Mr. Dottori.
In addition to the financial support and commitment of Birla,
Tembec's view of the project was favourably influenced by the
decision to accelerate the conversion of the mill to specialty and
dissolving pulp grades, as well as maintaining its current
capability as a producer of hardwood pulp for paper grades.
"This accelerated ability to be able to move the mill away from
the vagueries of the hardwood pulp business and into these other
grades made it possible for Tembec to take another look at this
opportunity. As a mill producing hardwood paper grade pulp, it
would be difficult for this mill to attain and maintain a position
of cost competitiveness against the large scale, low cost South
American producers" said Mr. Dottori.
The Framework Agreement signed on April 1 provides the guidelines
for the development of the final agreements and working
relationships. It is expected that these details will be worked
out in the next several weeks and that site preparation, plant
rehabilitation and training can be completed through the summer
and early fall to allow a restart of the mill by October or
November.
"While there are a number of issues to finalize, we are extremely
hopeful that these can addressed in the next few weeks" said Mr.
Jain.
When Tembec's initial decision not to pursue the St. Anne
acquisition was announced on March 8, Mr. Dottori had been very
complimentary of the manner in which the Provincial officials
involved had conducted themselves. He again commented on this, a
sentiment echoed by Mr. Jain. "Both negotiating teams are to be
complimented. As with the previous effort, the Provincial
officials with whom we dealt conducted themselves in a manner that
should be a model for governments anywhere. They were principled,
straightforward, realistic and tough" said Mr. Dottori. "We would
like to thank Premier Lord in particular for the role that he
played in helping to resolve some key final points. His
involvement and the commitment of his representatives was critical
to this outcome."
"As positive and exciting as the announcement is, it is important
for all parties involved to recognize three things. First, there
is much to be done before the mill can get back into production.
Second, the mill will need to be converted to produce a more
diverse product mix of specialty pulps. This will involve capital
investment in plant and equipment and a parallel investment in the
training of people. Third, and perhaps most important, it will be
critical for this business to achieve excellence in both cost and
quality if it is to be able to compete in a world of liberalized
trade and intense competition," said Mr. Jain.
"All parties must be prepared to work together to overcome these
challenges," concluded Mr. Jain.
The Aditya Birla Group -- http://www.adityabirla.com/-- has a
turnover exceeding $6 billion US (as at March 31, 2004) and is one
of the largest business houses in India. It enjoys a leadership
position in all the sectors in which it operates including cement,
non-ferrous metals, carbon-black, and pulp and fibre. The group
has 66 manufacturing operations in eight countries around the
world including India, Thailand, Indonesia, Malaysia, the
Philippines, Australia, China, Egypt and Canada. It is reckoned
as India's first multinational corporation. The group is anchored
by 72,000 employees and has over 700,000 shareholders with an
asset base of over $6 billion US.
Tembec Inc. -- http://www.tembec.com/-- is a leading integrated
forest products company, well established in North America and
France. With sales of approximately $4 billion and some 11,000
employees, it operates 50 market pulp, paper and wood product
manufacturing units, and produces chemicals from by-products of
its pulping process. Tembec markets its products worldwide and
has sales offices in Canada, the United States, the United
Kingdom, Switzerland, China, Korea, Japan, and Chile. The Company
also manages 40 million acres of forest land in accordance with
sustainable development principles and has committed to obtaining
Forest Stewardship Council -- FSC -- certification for all forests
under its care by the end of 2005. Tembec's common shares are
listed on the Toronto Stock Exchange under the symbol TBC.
* * *
As reported in the Troubled Company Reporter on Jan. 6, 2005,
Moody's Investors Service downgraded the senior implied, senior
unsecured and issuer ratings of Tembec Inc.'s key operating
subsidiary, Tembec Industries, Inc., to B2 from Ba3. The outlook
was changed to stable from negative.
As reported in the Troubled Company Reporter on Dec. 22, 2004,
Standard & Poor's Ratings Services lowered its long-term corporate
credit and senior unsecured ratings on Tembec, Inc., and its
subsidiary, Tembec Industries, Inc., to 'B' from 'BB-'. The
outlook is currently stable.
TENGASCO INC: Losses & Deficits Trigger Going Concern Doubt
-----------------------------------------------------------
Tengasco, Inc. (AMEX:TGC) filed with the Securities and Exchange
Commission its Annual Report on Form 10-K for the year ending
December 31, 2004.
In its report, the Company stated that it incurred a net loss to
holders of common stock of $1,994,025 in 2004 compared to a net
loss of $3,451,580 in 2003 and compared to a net loss of
$3,661,344 in 2002.
The Company also stated it realized oil and gas revenues of
$6,013,374 in 2004 compared to $6,040,872 in 2003 and $5,437,723
in 2002. Revenues remained stable in 2004 from 2003 levels due to
increases in prices received for sales of oil and gas. Oil and
gas volumes produced from the Company's Kansas Properties remained
relatively constant, experiencing expected small declines in
production consistent with the age of the producing properties.
The volume of gas sold from the Swan Creek Field decreased to
223,078 Mcf in 2004 from 384,238 Mcf in 2003 and the volume of oil
sold from Swan Creek Field decreased to 13,515 barrels in 2004
from 24,284 barrels in 2003. The Company stated that a decline in
volumes of oil and gas produced from its existing wells in the
Swan Creek Field was normal and not unexpected, and the decrease
in volumes was offset by increases in price of the oil and gas
volumes sold.
Going Concern Doubt
The Company's auditors, BDO Seidman, raised substantial doubt
about the Company's ability to continue as a going concern because
the Company has suffered recurring losses from operations and, at
December 31, 2004, has an accumulated deficit of $33,385,524 and a
working capital deficit of $6,753,721. The working capital
deficiency has resulted in the Company's inability to pay
cumulative dividends and mandatory redemption requirements on the
Company's shares subject to mandatory redemption.
About the Company
Tengasco Inc. is engaged in the business of exploring for,
producing and transporting oil and natural gas in Tennessee and
Kansas. The company leases producing and non-producing properties
with a view toward exploration and development. Emphasis is also
placed on pipeline and other infrastructure facilities to provide
transportation services. Tengasco uses seismic technology to
improve the recovery of reserves. Its lease position in these
areas in Tennessee is approximately 28,338 acres.
THE MARKET: Case Summary & 28 Largest Unsecured Creditors
---------------------------------------------------------
Lead Debtor: The Market - Antiques and Home Furnishings, Inc.
dba The Market
1221 Profit Drive
Dallas, Texas 75247
Tel: (214) 748-0472
Bankruptcy Case No.: 05-33774
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Market Line Wholesale Company, Inc. 05-33788
Type of Business: The Debtor sells antique furniture and
accessories from many different periods.
See http://www.themarketonline.com/
Chapter 11 Petition Date: April 4, 2005
Court: Northern District of Texas (Dallas)
Judge: Steven A. Felsenthal
Debtor's Counsel: Mark Edward Andrews, Esq.
Omar J. Alaniz, Esq.
Neligan Tarpley Andrews & Foley LLP
1700 Pacific Avenue, Suite 2600
Dallas, Texas 75201
Tel: (214) 840-5300
Total Assets Total Debts
------------ -----------
The Market -
Antiques and Home
Furnishings, Inc. $100,000 to $500,000 $1M to $10M
Market Line Wholesale
Company, Inc. $1M to $10M $100,000 to $500,000
A. The Market - Antiques and Home Furnishings, Inc.'s 20 Largest
Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Maitland-Smith U.S., Inc. Trade Debt $299,377
2427 Penny Road
High Point, NC 27265
Attn: Sheila Welch
Northern Fine Art Trade Debt $165,800
Building Seven
Ilene Court, Suite Three
Hillsborough, NJ 08844
Phillip Janetto Promissory Note $110,618
3708 Trailwood Drive
Richardson, TX 75082
Burton James Trade Debt $102,340
428 Turnbull Canyon Road
City of Industry, CA 91745
Kurt S. Adler Inc. Trade Debt $94,122
Mark Roberts Trade Debt $83,023
Swiss Crystal, Inc. Trade Debt $76,224
Crystal Clear Ind. Trade Debt $73,611
American Express 31008 Trade Debt $71,236
Raz Imports, Inc. Trade Debt $63,231
American Express TD Trade Debt $54,103
Asia Minor Carpets Trade Debt $50,708
Citibank 9853-8473 Trade Debt $47,347
Arty Imports Trade Debt $46,339
Guy Chaddock & Company Trade Debt $45,164
Citibank Advantage 8650 Trade Debt $42,504
American Express Optima Trade Debt $37,560
Hickory Chair Trade Debt $34,387
Tomlinson/Erwin-Lambeth Trade Debt $31,871
Renaissance Collection Trade Debt $30,904
B. Market Line Wholesale Company, Inc.'s 8 Largest Unsecured
Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Lincoln Imports Ltd., Inc. Trade Debt $91,340
378 East Orangethorpe Avenue
Placentia, CA 92870
Jim Marvin Enterprises Ltd. Trade Debt $85,397
PO Box 611
Dickson, TN 37058
Attn: Dawn Burnette
Farrisilk, Inc. Trade Debt $54,323
360 East Crowther Avenue
Placentia, CA 92870
Aldik Artificial Flower Trade Debt $35,871
Wholesale Lockbox 3367
PO Box 643367
Cincinnati, OH 45264-3367
Regency International Trade Debt $35,204
Royal Green Enterprises Ltd. Trade Debt $5,239
Hosley International Trade Debt $1,550
American-de Rosa Trade Debt $114
Lamparts, Inc.
TRUMP HOTELS: Judge Wizmur Confirms Plan of Reorganization
----------------------------------------------------------
The Honorable Judith H. Wizmur of the U.S. Bankruptcy Court for
the District of New Jersey confirmed the Revised Plan of
Reorganization filed on Mar. 30 by Trump Hotels & Casino Resorts,
Inc., and its debtor-affiliates.
A full-text copy of the Third Amended Plan is available for free
at:
http://www.thcrrecap.com/pdfs/901-100/03-30-05-901.pdf
Trump Hotels & Casino Resorts, Inc., will now be called Trump
Entertainment Resorts Inc. Pursuant to the Plan, Bondholders will
get a 65% stake in the Reorganized Company.
Rosland Briggs Gammon of Bloomberg News reported that Donald
Trump's 56% stake in the Company will be lowered to 30%. He
received his ownership stake in exchange for a personal investment
of $55 million and $16.4 million in notes contribution. He will
also get a 25% stake in the Miss Universe pageant.
As previously reported, the Company resolved shareholders'
objections to the Debtors' plan by giving them $17.5 million from
the sale of the World's Fair site in Atlantic City, New Jersey.
The shareholders will also receive one share of the Reorganized
Trump for every thousand they own, as well as one-year warrants to
purchase shares of new common stock.
The Company's expecting its debt to be lowered to $1.25 billion
after it will emerge sometime in May.
Morgan Stanley and UBS Investment Bank will provide Trump a $500
million exit financing.
Headquartered in Atlantic City, New Jersey, Trump Hotels & Casino
Resorts, Inc. -- http://www.thcrrecap.com/-- through its
subsidiaries, owns and operates four properties and manages one
property under the Trump brand name. The Company and its debtor-
affiliates filed for chapter 11 protection on Nov. 21, 2004
(Bankr. D. N.J. Case No. 04-46898 through 04-46925). Robert A.
Klymman, Esq., Mark A. Broude, Esq., John W. Weiss, Esq., at
Latham & Watkins, LLP, and Charles Stanziale, Jr., Esq., Jeffrey
T. Testa, Esq., William N. Stahl, Esq., at Schwartz, Tobia,
Stanziale, Sedita & Campisano, P.A., represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed more than
$500 million in total assets and more than $1 billion in total
debts.
TRUMP HOTELS: Trump Indiana Will Pay $20.7MM to Settle Tax Claims
-----------------------------------------------------------------
Trump Indiana, Inc., asks the U.S. Bankruptcy Court for the
District of New Jersey to approve its settlement agreement with
the Indiana Department of Revenue.
Charles A. Stanziale, Jr., Esq., at Schwartz Tobia Stanziale
Sedita & Campisano, in Montclair, New Jersey, relates that on
January 11, 2005, the Revenue Department filed a proof of claim
in the Debtors' Chapter 11 cases. The Revenue Department
asserted $23,832,065 in unpaid taxes, interest and penalties:
-- a $9,773,320 secured claim;
-- a $12,736,555 priority tax claim; and
-- a $1,322,190 unsecured claim.
Trump Indiana disputes certain of the tax obligations asserted in
the Claim. At the same time, Mr. Stanziale points out, Trump
Indiana is sensitive to the costs of litigating disputes and the
risks inherent in any litigation. Consequently, Trump Indiana
entered into negotiations with the Revenue Department to resolve
the disputes between them. On March 23, 2005, the parties
executed the Settlement Agreement.
Pursuant to the Settlement Agreement, Trump Indiana will pay the
Revenue Department $20,708,071 in satisfaction of the Claim.
Mr. Stanziale tells the Court that upon execution of the
Settlement Agreement, Trump Indiana paid $500,000 to the Revenue
Department pursuant to the Court's order authorizing the Debtors'
payment of prepetition taxes and customer-related claims.
The Settlement Agreement requires Trump Indiana to make further
payments of $500,000 on a monthly basis until the effective date
of the Debtors' Joint Plan of Reorganization. Assuming the Court
confirms the Plan, Trump Indiana is required to pay the rest of
the Settlement Amount on the effective date of the Plan.
At the Revenue Department's sole election, the Settlement
Agreement will become null and void if:
* Trump Indiana fails to timely pay the Settlement Amount; or
* the effective date of the Plan does not occur on or before
July 30, 2005.
The Revenue Department agreed to return all portions of the
Settlement Amount previously paid to it if it elects to terminate
the Settlement Agreement or in the event that the Court doesn't
approve the Settlement.
The Settlement Agreement represents a fair and reasonable
compromise of the disputes, Mr. Stanziale asserts. Moreover, the
Debtors believe that litigating the disputes with the Revenue
Department will be expensive and time-consuming. There is also
no assurance that Trump Indiana would ultimately prevail in that
litigation, Mr. Stanziale says.
It is also imperative that the Debtors maintain reasonably good
relationships with the various state regulators that are involved
in their businesses and in the gaming industry, Mr. Stanziale
adds. "While the Debtors believe that the Settlement Agreement
represents a good value for the estates standing on its own, they
believe that it will also further their effort at building and
maintaining a good and cooperative relationship with the [Revenue
Department]."
Accordingly, Mr. Stanziale concludes, the Settlement Agreement is
a cost-effective means to resolve the Tax Claim and should be
approved.
Headquartered in Atlantic City, New Jersey, Trump Hotels & Casino
Resorts, Inc. -- http://www.thcrrecap.com/-- through its
subsidiaries, owns and operates four properties and manages one
property under the Trump brand name. The Company and its debtor-
affiliates filed for chapter 11 protection on Nov. 21, 2004
(Bankr. D. N.J. Case No. 04-46898 through 04-46925). Robert A.
Klymman, Esq., Mark A. Broude, Esq., John W. Weiss, Esq., at
Latham & Watkins, LLP, and Charles Stanziale, Jr., Esq., Jeffrey
T. Testa, Esq., William N. Stahl, Esq., at Schwartz, Tobia,
Stanziale, Sedita & Campisano, P.A., represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed more than
$500 million in total assets and more than $1 billion in total
debts.
TRUMP HOTELS: Inks Pact to Settle ERISA Plaintiff's Objections
--------------------------------------------------------------
Gary Noa, Elmer Arthur Kaler, Joseph Yaniak and Judith Holden are
creditors of Trump Hotels & Casino Resorts, Inc., and its debtor-
affiliates and plaintiffs in a federal ERISA action entitled Gary
Noa, et al., v. Craig D. Keyser, Judy Fisher and John Does 1-10,
pending in the United States District Court for the District of
New Jersey.
The Debtors' Plan of Reorganization, the ERISA Plaintiffs believe,
does not satisfy all of the applicable provisions of the
Bankruptcy Code.
Before filing the ERISA Action, the ERISA Plaintiffs timely filed
claims against the Debtors. The ERISA Claims, like the ERISA
Action, seek recovery for losses resulting from wrongful actions
by fiduciaries, including some of the Debtors, in connection with
dealings involving Trump Hotels & Casino Resorts, Inc.'s common
stock investments in the Trump Capital Accumulation Plan. The
Capital Plan is a 401(k) savings plan sponsored by the operators
of the Debtors' three casinos and primary employers -- Trump Taj
Mahal Associates, Trump's Castle Associates LP and Trump Indiana,
Inc.
According to Michael J. Viscount, Jr., Esq., at Fox Rothschild
LLP, in Atlantic City, New Jersey, to the extent the Debtors
intend for the Plan to release or otherwise impair the claims of
the ERISA Plaintiffs or any other party against any non-debtor
third party, the Plan cannot be confirmed. "[Those] releases are
improper and are not permissible under the Bankruptcy Code and
recognized case law."
To overcome the improper release, the ERISA Plaintiffs propose to
insert and include this provision in the Plan and in the
confirmation order:
"Nothing in the Plan or in any Order confirming the Plan,
shall affect, release, enjoin or impact in any way the
prosecution of the ERISA Plaintiffs' claims asserted, or to be
asserted, against non-Debtor Defendants in the ERISA Action
and/or any other non-Debtor, whether as a fiduciary or
otherwise."
To the extent the Debtors intend to classify and treat the claims
asserted by the ERISA Plaintiffs as Class 13 Claims under the
Plan, the ERISA Plaintiffs object to the classification as
improper.
The ERISA Plaintiffs' claims are based on violations of the
federal ERISA statutes and breach of fiduciary duty under common
law principals by the Debtors and by certain individual non-
debtor third parties who are fiduciaries vis-a-vis the ERISA
Plaintiffs, Mr. Viscount points out. "It appears that, through
the Plan, the Debtors attempt to annul each of the ERISA Claims
by classifying each as a 'Securities Claim'." Pursuant to the
Plan, holders of Allowed Securities Claims are members of Class
13 and will not receive or retain any cash or property.
Additionally, Mr. Viscount continues, the Plan purports to
provide that the claims or causes of action against the Debtors'
directors, officers, employees and advisors are released, waived
and relinquished. "The result of the Plan, therefore, is that
the ERISA Claims are annulled, without payment of any amount at
all, and the claims of the Plaintiffs in the ERISA Action against
third party fiduciaries who are not Debtors are also disposed of
without any consideration of the ERISA Action by the District
Court or payment by responsible parties."
"[The] classification is improper, because the [ERISA claims]
. . . are not substantially similar to the other types of claims
included by the Debtors for treatment as Securities Claims in
Class 13," Mr. Viscount argues. Accordingly, the ERISA
Plaintiffs believe that their claims should not be classified as
Class 13 but rather reclassified as Class 7 -- general unsecured
claims -- under the Plan.
Stipulation
The Debtors entered into a stipulation with ERISA Plaintiffs Gary
Noa, Elmer Arthur Kaler, Joseph Yaniak and Judith Holden to
resolve the confirmation objection. The parties agree that:
a. All claims relating to the Trump Accumulation Plan,
including the ERISA Claims, to the extent allowed, will be
treated as Class 7 Claims under the Plan -- general
unsecured claims that are unimpaired.
b. The Debtors' maximum liability under the TCAP Claims will
be $1.73 million in the aggregate. The cap will be in
effect only if the claims are actually paid under the terms
of a confirmed Plan. The ERISA Plaintiffs will have a
complete reservation of rights against the Debtors
regarding the cap. The Debtors reserve all of their rights
with respect to the TCAP Claims.
c. The releases and injunctions as to non-debtor parties
contained in the Plan will not apply to the ERISA
Plaintiffs with respect to the ERISA Claims or
any claims or causes of action in the ERISA Action. The
ERISA Plaintiffs will have a complete reservation of rights
against the non-debtor parties in the ERISA Action.
Nothing in the Plan will be construed as a cap on the
liability of non-debtor parties with respect to the Claims.
d. The automatic stay will be vacated as to the TCAP Claims so
all related claims may be litigated in the ERISA Action in
the District Court or in another forum as may be
appropriate.
e. Upon the approval of the Stipulation of the U.S. Bankruptcy
Court for the District of New Jersey, the ERISA
Plaintiffs will withdraw their Objection and will not
oppose the confirmation of the Plan in any way.
f. Nothing contained in the Plan or any order confirming the
Plan will have res judicata effect with respect to the
determination of the TCAP Claims or any other aspect of the
ERISA Action.
Headquartered in Atlantic City, New Jersey, Trump Hotels & Casino
Resorts, Inc. -- http://www.thcrrecap.com/-- through its
subsidiaries, owns and operates four properties and manages one
property under the Trump brand name. The Company and its debtor-
affiliates filed for chapter 11 protection on Nov. 21, 2004
(Bankr. D. N.J. Case No. 04-46898 through 04-46925). Robert A.
Klymman, Esq., Mark A. Broude, Esq., John W. Weiss, Esq., at
Latham & Watkins, LLP, and Charles Stanziale, Jr., Esq., Jeffrey
T. Testa, Esq., William N. Stahl, Esq., at Schwartz, Tobia,
Stanziale, Sedita & Campisano, P.A., represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed more than
$500 million in total assets and more than $1 billion in total
debts.
TSI TELSYS: Discloses Financial Investments & Strategic Alliances
-----------------------------------------------------------------
TSI TelSys Corporation has reached final agreement with two
financial backers who will provide up to US$1,500,000 available to
the Company. These funds will be used primarily for future
product development, contract implementation, and marketing
activities. In addition, TSI has signed a Strategic Alliance with
C.R. International to become its exclusive manufacturer and
assembler to meet TSI's manufacturing commitments.
Last autumn, TSI announced that it was entering into a conditional
loan agreement with Mr. Robert S. Leben and one of his associated
companies to provide funding to TSI. All negotiations have now
been concluded and agreement reached. By letter dated April 3,
2005, Mr. Leben, a New York financier, states, "our reviews,
undertaken by our financial group, attorneys, and ourselves, have
been satisfactory with the final decision to proceed with the
investment in TSI TelSys, Inc. The investment amount will be
US$500,000 . . . ." He further states that the Funding Agreement
that has been under preparation has "been approved" and concludes
noting that "we should be ready to move forward by this coming
Friday, April 8, 2005. Our intention is to have this investment
fully implemented with a Closing dated on or before April 15,
2005."
In addition, by letter of April 1, 2005, an international trading
company headquartered in California announced its intention to
provide a line of credit to TSI up to US$1,000,000. "Following
our discussions, completion of our due diligence, and our review
of TSI TelSys' new product line and its efforts to obtain the SLRS
(Space Lift Range Standardization) contract" it was "decided to
establish a Line of Credit on behalf of TSI . . . ." The final
agreement was executed on April 1, 2005. Under the terms of the
Agreement, the line of credit will be established by the end of
this week and will become effective upon receiving approval of the
Toronto Venture Exchange. This line of credit is being
established for the purpose of providing the necessary capital to
TSI to meet all its obligations to fully implement the SLRS
contract if awarded to TSI.
Headquartered in Columbia, Maryland, TSI TelSys designs,
manufactures and markets high-performance data acquisition,
simulation and communication systems for the test range and
aerospace communities and provides related engineering services.
The Company has been a pioneer in utilizing reconfigurable
architectures (Adaptive Computing) for communications and data
processing, and has incorporated this technology into its product
line since 1996. The Company is a leader in providing multi-
mission satellite communications systems adaptable to virtually
any protocol format and that support data rates up to a gigabit
per second -- Gbps.
At September 24, 2004, TSI TelSys' balance sheet shows a
C$1,925,223 deficit, compared to a C$1,145,834 deficit at
December 26, 2003.
TSI TELSYS: Taps American Express for Financial Services
--------------------------------------------------------
TSI TelSys Corporation reported that American Express Tax and
Business Services (TBS) Inc. was retained March 14, 2005, to
provide a broad range of financial services. TBS will provide tax
planning and preparation services, including income and sales tax,
IRS resolutions, and international tax compliance. TBS will
provide oversight and onsite services for accounting and
bookkeeping, and also a number of specialized business consulting
services.
Headquartered in Columbia, Maryland, TSI TelSys designs,
manufactures and markets high-performance data acquisition,
simulation and communication systems for the test range and
aerospace communities and provides related engineering services.
The Company has been a pioneer in utilizing reconfigurable
architectures (Adaptive Computing) for communications and data
processing, and has incorporated this technology into its product
line since 1996. The Company is a leader in providing multi-
mission satellite communications systems adaptable to virtually
any protocol format and that support data rates up to a gigabit
per second -- Gbps.
At September 24, 2004, TSI TelSys' balance sheet shows a
C$1,925,223 deficit, compared to a C$1,145,834 deficit at
December 26, 2003.
UAL CORP: Creditors Panel Gets Court Nod to Retain GCW as Advisor
-----------------------------------------------------------------
As reported in the Troubled Company Reporter on March 18, 2005,
the Official Committee of Unsecured Creditors appointed in UAL
Corporation and its debtor-affiliates' chapter 11 cases, seeks the
U.S. Bankruptcy Court for the Northern District of Illinois'
authority to retain GCW Consulting LLC, as special consultant,
effective March 3, 2005.
In an affidavit, Morris Garfinkle, the Founder, President and
Chief Executive Officer of GCW Consulting LLC, assures the Court
that the firm has the qualifications and experience in the
airline industry to serve in the capacity requested by the
Committee. Mr. Garfinkle states that GCW neither holds nor
represents any interest adverse to the Committee, the Debtors,
their creditors or other parties in interest. GCW is a
"disinterested person" within the meaning of the Bankruptcy Code.
* * *
After a hearing, Judge Wedoff approves the Application.
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. Employing 61,200 workers, United, United Express and
Ted operate more than 3,500 flights a day to more than 200 U.S.
domestic and international destinations from hubs in Los Angeles,
San Francisco, Denver, Chicago and Washington, D.C. The Company
filed for chapter 11 protection on December 9, 2002 (Bankr. N.D.
Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc
Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba,
Esq., at Kirkland & Ellis, represent the Debtors in their
restructuring efforts. When the Debtors filed for protection from
their creditors, they listed $24,190,000,000 in assets and
$22,787,000,000 in debts. (United Airlines Bankruptcy News, Issue
No. 79; Bankruptcy Creditors' Service, Inc., 215/945-7000)
V.I. TECH: Regains Compliance with Nasdaq Listing Requirements
--------------------------------------------------------------
V.I. Technologies, Inc. (Nasdaq: VITX) received formal
notification from The Nasdaq Stock Market, Inc., that the Company
has regained compliance with the minimum bid and shareholder
equity requirements for continued listing on the Nasdaq National
Market. This brings the Company into full compliance with the
requirements for continued listing. There are no further actions
required of the Company.
Going Concern Doubt
In its Form 10-K for the fiscal year ended Dec. 31, 2004, filed
with the Securities and Exchange Commission, Vitex's auditors,
KPMG LLP, raised substantial doubt about the Company's ability to
continue as a going concern because the Company has incurred
significant recurring losses from operations, and its current cash
balances as of December 31, 2004, are not sufficient to support
its operations over the next year. As of December 31, 2004, the
Company has an accumulated deficit of $169.3 million. The
Company's available unrestricted cash balances on February 28,
2005 were approximately $1 million. Management believes that
VITEX's present cash resources will be adequate to meet its
requirements only through the first quarter of 2005.
About the Company
V.I. Technologies, Inc. -- http://www.vitechnologies.com/-- is
developing the next generation of anti-infective products. The
Company is engaged in the discovery and development of small
molecule oral drugs for the treatment of HIV and other major human
viral diseases. Vitex's proprietary discovery technologies and
lead therapeutic candidate PA-457 focus on novel targets in the
virus life cycle, including virus fusion and virus maturation. The
Company's separate INACTINE(TM) technology is designed to
inactivate a wide range of viruses, bacteria and parasites in
blood products, and has demonstrated its ability to remove prion
proteins.
VERY LTD: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Very, Ltd.
aka Au Bar
aka Le Jazz Au Bar
aka 58
625 Madison Avenue
New York, New York 10022
Tel: (212) 308-9455
Bankruptcy Case No.: 05-12248
Type of Business: The Debtor owns and operates a high-class,
first-rate nightclub.
Chapter 11 Petition Date: April 5, 2005
Court: Southern District of New York (Manhattan)
Debtor's Counsel: Thomas Alan Draghi, Esq.
Westerman Ball Ederer Miller & Sharfstein, LLP
170 Old Country Road, Fourth Floor
Mineola, New York 11501
Tel: (516) 622-9200
Fax: (516) 622-9212
Estimated Assets: $100,000
Estimated Debts: $1,500,000
Debtor's 20 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
SL Green Realty Corporation Rent $550,726
420 Lexington Avenue
New York, NY 10170
Internal Revenue Service $400,000
110 West 44th Street, 4th Floor
New York, NY 10036
Attn: Seth Fox
New York State Sales tax $300,000
Department of Tax & Finance
80-02 Kew Gardens Road, 5th Floor
Kew Gardens, NY 11415
Peerless Importers $62,584
16 Bridgewater Street
Brooklyn, NY 11222
M & M Sales Company, Inc. $22,614
25-33 Wolffe Street
Yonkers, NY 10705
West - Conn $20,011
Building F-16
Bronx, NY 10474
Eliran Murphy Group Ltd. Judgment $14,500
c/o Goetz Fitzpatrick
One Penn Plaza, Suite 4401
New York, NY 10119
Graces Marketplace $12,537
1735 Park Avenue
New York, NY 10035
BMI Trade Debt $12,295
PO Box 406741
Atlanta, GA 30384-6741
ABW Media & Design Trade Debt $11,000
24 Tree Top Lane
Dobbs Ferry, NY 10522
A.I.C.C.O. Trade Debt $10,590
1001 Winstead Drive, Suite 500
Cary, NC 27513
Southern Wine & Spirits Trade Debt $8,516
345 Underhill Boulevard
PO Box 9034
Syosset, NY 11791-9034
Craine Air Conditioning Trade Debt $7,408
90-05 Liberty Avenue
Ozone Park, NY 11417
Doria Enterprises, Inc. Lawsuit $6,135
c/o Laurino & Laurino
229 Seventh Street, Suite 201
Garden City, NY 11530
Origlio Public Relations Trade Debt $6,000
333 West 39th Street
New York, NY 10018
Halland Companies Trade Debt $5,320
45 Executive Drive
Plainview, NY 11803
New York State Taxes $5,000
Department of Labor
Building 12, Harriman Campus
Albany, NY 12240
Dairyland Trade Debt $4,829
1300 Viele Avenue
Bronx, NY 10474
Johnsondiversey Trade Debt $3,694
PO Box 67000
Detroit, MI 48267-1049
Best Metropolitan Trade Debt $3,617
45 Kosciusko Street
Brooklyn, NY 11205
VIP LODGING: Case Summary & 6 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: VIP Lodging Group, Inc.
1601 East Division Street
Arlington, Texas 76011
Bankruptcy Case No.: 05-43389
Type of Business: The Debtor operates a Comfort Inn hotel.
Chapter 11 Petition Date: April 4, 2005
Court: Northern District of Texas (Ft. Worth)
Judge: D. Michael Lynn
Debtor's Counsel: Richard Young, Esq.
125 Town Park Drive, Suite 300
Atlanta, Georgia 30144
Tel: (770) 420-8290
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 6 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Bimal, Inc. $1
4820 Massachusetts Boulevard
College Park, GA 30337
Mrs. Indu V. Patel $1
3617 Blakeford Court
Marietta, GA 30062
Dr. Val T. Patel $1
3617 Blakeford Court
Marietta, GA 30062
VTP Business Management, Inc. $1
3617 Blakeford Court
Marietta, GA 30062
VIP Lodging Group, Inc. $1
3617 Blakeford Court
Marietta, GA 30062
Amit, Inc. $1
4820 Massachusetts Boulevard
College Park, GA 30337
VISTA GOLD: Posts $4.9 Million Net Loss in Fiscal-Year 2004
-----------------------------------------------------------
Vista Gold Corp. (Amex: VGZ; Toronto) reported its financial
results for the year ended December 31, 2004, as filed on
March 31, 2005, with the U.S. Securities and Exchange Commission
in the Corporation's Annual Report on Form 10-K. For the year
ended December 31, 2004, Vista reported a consolidated net loss of
US$4.9 million or US$0.31 per share compared to the 2003
consolidated net loss of US$2.7 million or US$0.22 per share.
The increase of US$2.2 million in 2004 is due to increased holding
costs at the Hycroft Mine of US$0.6 million; decreased holding
costs at the Amayapampa property of US$0.1 million; increased
property exploration costs of US$0.2 million; increased general
and administrative costs of US$0.5 million; and increased stock-
based compensation of US$1.0 million (a non-cash item).
The Corporation received net cash from financing activities of
US$9.8 million in 2004 compared to US$8.1 million in 2003. Net
cash used in investing activities in 2004 was US$6.1 million
compared to US$3.0 million in 2003. This increase primarily
reflects US$3.3 million set aside for increased bond requirements
at Hycroft in 2004, compared to US$1.7 million in 2003. Net
cash used for operations in 2004 was US$3.4 million compared to
US$3.0 million in 2003. The unused cash received from financing
activities in 2004 is on hand as working capital.
The financial position of the Corporation included current assets
at December 31, 2004, of US$6.8 million compared to US$6.5 million
in 2003 and total assets of US$32.8 million at December 31, 2004,
compared to US$26.3 million in 2003. Total liabilities at
December 31, 2004, were US$4.4 million compared to US$4.6 million
in 2003 and shareholders' equity was US$28.3 million at December
31, 2004, compared to US$21.7 million in 2003. The Corporation's
working capital as of December 31, 2004, was US$6.6 million, which
increased by US$0.5 million from US$6.1 million in 2003.
Selected Financial Data
Years ended December 31
U.S. $ 000's, except loss per share 2004 2003
Results of operations
Net loss $(4,924) $(2,745)
Basic and diluted loss per share $(0.31) $(0.22)
Net cash used in operations $(3,351) $(3,008)
Net cash used in investing activities (6,100) (3,002)
Net cash provided by financing activities 9,847 8,087
Financial position
Current assets $6,826 $6,485
Total assets 32,788 26,280
Current liabilities 256 408
Total liabilities 4,444 4,577
Shareholders' equity 28,344 21,703
Working capital $6,570 $6,077
On another matter, Mike Richings, President and CEO, commented,
"Our due diligence efforts regarding the Awak Mas property in
Indonesia are proceeding on schedule and we anticipate exercising
the option to acquire the property in April, following Vista's
board of directors' and regulatory approvals."
Vista Gold Corp., based in Littleton, Colorado, evaluates and
acquires gold projects with defined gold resources. Additional
exploration and technical studies are undertaken to maximize the
value of the projects for eventual development. The Corporation's
holdings include the Maverick Springs, Mountain View, Hasbrouck,
Three Hills, Wildcat projects and Hycroft mine, all in Nevada, the
Long Valley project in California, the Yellow Pine project in
Idaho, the Paredones Amarillos and Guadalupe de los Reyes projects
in Mexico, and the Awak Mas project in Sulawesi in Indonesia.
* * *
As reported in the Troubled Company Reporter on April 1, 2004,
Vista Gold's independent auditors expressed doubt about the
company's ability to continue as a going concern after reviewing
its financial statements for the year ending Dec. 31, 2003.
In its Form 10-Q for the quarterly period ended Sept. 30, 2004,
filed with the Securities and Exchange Commission, Vista Gold
reported a $1,047,000 net loss for the three months ended
September 2004, compared to a $531,000 net loss from the same
period in September 2003.
VWR INT'L: Expands Services to Ireland with AGB Acquisition
-----------------------------------------------------------
VWR International reported the acquisition of AGB Scientific Ltd.,
Dublin, Ireland, the leading Irish scientific laboratory supply
distributor.
AGB Scientific, an Irish company founded in 1967, has over 100
employees and distributes laboratory instrumentation, equipment
and consumables throughout Ireland and elsewhere. Over the years,
the company has acquired the Irish distribution rights for
products from many well-respected international scientific
manufacturers. In 2004, the company had sales of over
EUR30 million.
"This acquisition represents an outstanding opportunity for VWR to
enhance its ability to serve customers in Ireland and elsewhere,"
said Walter W. Zywottek, VWR president and chief executive
officer. "AGB is an exceptional sales organization with a long
history and a solid presence in the marketplace that will support
our goals of premier service, product quality and customer
satisfaction."
Patrick McGinn, managing director of AGB Scientific, said: "We are
excited to join VWR's global organization. Over the years, our
company has prided itself on being able to offer comprehensive
sales support. With the backing of a company with VWR's stature,
we are now ideally positioned to bring this high level of support
to an even wider customer base."
About AGB Scientific Ltd.
AGB Scientific Ltd. -- http://www.agb.ie/-- is Ireland's largest
supplier of laboratory instrumentation, equipment, consumables and
expertise, representing many of the world's major equipment
manufacturers. AGB Scientific provides Ireland's scientists with a
high level of technical support for the analytical instrumentation
and laboratory equipment that constitutes the backbone of Irish
scientific manufacturing.
About VWR International, Inc.
VWR International is a global leader in the distribution of
scientific supplies, with worldwide sales of $3.0 billion. VWR's
business is highly diversified across a spectrum of products and
services, customer groups and geography. The company offers more
than 750,000 products, from more than 5,000 manufacturers, to over
250,000 customers throughout North America and Europe. VWR's
primary customers work in the pharmaceutical, life science,
chemical, technology, food processing and consumer product
industries. Other important customers include universities and
research institutes; governmental agencies; environmental testing
organizations; and primary and secondary schools. VWR
International affiliates operate in 18 countries and employ almost
6,000 people. The company's mission is to deliver excellence in
the distribution of scientific supplies. The VWR International
Group is headquartered in West Chester, Pennsylvania.
* * *
As reported in the Troubled Company Reporter on Dec. 9, 2004,
Standard & Poor's Ratings Services lowered its corporate credit
and senior secured debt ratings on research laboratory products
distributor VWR International Corp. to 'B+' from 'BB-'. The
company's subordinated debt rating fell to 'B-' from 'B'. The
downgrade reflects the marked increase in debt the company will
incur as it pays a special dividend to parent holding company CDRV
Investors, Inc., who helped fund the company's acquisition from
German parent Merck KGaA earlier this year.
Standard & Poor's also assigned a 'B-' rating to $300 million in
proposed senior discount notes issued by CDRV Investors. The
rating on the new notes, due Jan. 1, 2015, reflects their status
as holding company obligations, effectively subordinated to
borrowings at VWR.
The recovery rating of '3' on VWR's senior secured notes is
affirmed. S&P says the outlook is stable.
WINN-DIXIE: S&P's Rating on Series 1991-1 Certs. Tumbles to D
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on class A-3
of Winn-Dixie Pass-Through Trust Certificates Series 1999-1 to 'D'
from 'C'. The lowered rating follows an interest shortfall
reflected on the April 1, 2005, distribution statement.
The shortfall resulted from waterfall changes relating to a
crossover event, as defined in the trust documents. This occurred
after the lessees on two properties failed to make rent payments
on Feb. 28, 2005, which went unremedied for 30 days. The
waterfall changes resulted in the interest on the A-3 certificate
becoming due and payable, as opposed to accruing and increasing
the principal balance of the certificates, as it had done before
the crossover event. As the certificate did not receive full and
timely interest, its rating has been lowered to 'D'.
YOUTHSTREAM MEDIA: To Consolidate Mill Operations Through KES
-------------------------------------------------------------
As reported in the Troubled Company Reporter on March 14, 2005,
YouthStream Media Networks, Inc. (OTC Bulletin Board: YSTM) had
completed the acquisition of KES Acquisition Company, LLC, the
owner and operator of Kentucky Electric Steel, a steel mini-mill
located in Ashland, Kentucky.
YouthStream will consolidate the operations of the Mill through
its ownership of KES Acquisition commencing March 1, 2005.
Accordingly, YouthStream's Quarterly Report on Form 10-QSB for the
three months ended March 31, 2005, which it expects to file with
the U.S. Securities and Exchange Commission in mid-May 2005, will
include the operations of the Mill for the month of March 2005.
YouthStream also expects to amend its Current Report on Form 8-K,
as filed with the U.S. Securities and Exchange Commission on
March 14, 2005, at approximately the same time to include the
required historical and pro forma financial information with
respect to this transaction.
In connection with the acquisition, YouthStream formed a new
subsidiary, YouthStream Acquisition Corp., in which it owns 80.01%
of the total outstanding common stock and 100% of the voting
common stock. The remaining 19.99% common stock interest in
YouthStream Acquisition is owned by the sellers of KES
Acquisition. YouthStream capitalized YouthStream Acquisition with
an aggregate of $500,000 in cash. YouthStream Acquisition issued
to the sellers of KES Acquisition:
(i) 25,000 shares of its non-convertible non-voting
redeemable preferred stock with a redemption price equal
to $25,000,000 and a 13% annual cumulative dividend; and
(ii) senior subordinated promissory notes in the aggregate
principal amount of $40,000,000 with an annual interest
rate of 8%.
Subsequent to this transaction, the management of the Mill
remained intact. This transaction did not result in any change in
the Mill's business operations or financial condition, and, other
than as set forth below, the working capital, operating cash flow,
debt service obligations and credit profile of the Mill were not
affected in any way by this transaction.
The Preferred Stock and Promissory Notes were issued by
YouthStream Acquisition, the parent company of KES Acquisition.
KES Acquisition is a separate legal entity that owns and operates
the Mill. The Promissory Notes are legal obligations solely of
YouthStream Acquisition, and are not obligations of KES
Acquisition, nor are they secured by the assets or cash flows of
the Mill. In the future, YouthStream Acquisition may grant liens
to secure repayment of the Promissory Notes, upon the consent of
any senior lender to KES Acquisition at that time. In addition,
the Promissory Notes are non-recourse to the assets of
YouthStream, except for the shares of capital stock of YouthStream
Acquisition that have been pledged by YouthStream to the holders
of the Promissory Notes.
The Promissory Notes require quarterly principal payments to be
made out of "free cash" generated by the Mill's operations, as
that term is defined in the transaction documents. Also,
beginning with the second anniversary of the issuance of the
Preferred Stock, YouthStream Acquisition will also be required to
use "free cash" generated by the Mill's operations to commence
redeeming shares of Preferred Stock in increments of at least
$4,000,000, with limited exceptions.
The Mill, located in Ashland, Kentucky, has been producing steel
for approximately forty years, and was acquired by the sellers
through a bankruptcy proceeding in September 2003. Following the
acquisition, the Mill was refurbished and has been generating
revenues since late January 2004. The Mill has an annual
production capacity of 240,000 tons of steel, and is currently
operating at approximately 80% of annualized capacity. Management
is focusing on developing the business and improving operating
efficiencies.
The Mill produces bar flats that are produced to a variety of
specifications and fall primarily into two general quality levels
-- merchant bar quality steel bar flats for generic types of
applications, and special bar quality steel bar flats, where more
precise customer specifications require the use of various alloys,
customized equipment and special production procedures to insure
that the finished product meets critical end-use performance
characteristics. The Mill is a leading manufacturer of SBQ Bar
Flats for the cold drawn bar converter and truck trailer support
beam markets.
The Mill manufactures over 2,600 different Bar Flat items which
are sold to the leaf-spring suspension market for light and heavy-
duty trucks, mini-vans and utility vehicles, cold drawn bar
converters, certain specialty applications for steel service
centers, truck trailer manufacturers and other miscellaneous
markets. The Mill was specifically designed to manufacture wider
and thicker bar flats up to three inches in thickness and twelve
inches in width that are required by these markets. In addition,
the Mill employs a variety of specially designed equipment which
is necessary to manufacture SBQ Bar Flats to the specifications
demanded by its customers. For more information about the Mill,
visit http://www.kentuckyelectricsteel.com/
About YouthStream Media
Prior to August 2002, YouthStream Media Networks, Inc., had a
media business and a retail business. The media segment
represented the Company's media, marketing and promotional
services provided to advertisers by Network Event Theater, Inc.
and American Passage Media, Inc. In August 2002, the Company sold
substantially all of the assets and certain liabilities from this
segment to Cass Communications, Inc., a subsidiary of Alloy, Inc.,
for $7 million in cash. The Company discontinued any remaining
media operations at that time. The retail segment consisted of
on-campus, online and retail store poster sales provided by its
Beyond the Wall subsidiary. In February 2004, the Company sold
substantially all of the assets, subject to certain liabilities,
of this segment and discontinued its operation.
Going Concern Doubt
In its Form 10-Q for the quarterly period ended Dec. 31, 2004,
filed with the Securities and Exchange Commission, YouthStream
Media Networks, Inc., disclosed that it has incurred recurring
operating losses since its inception. As of December 31, 2004,
the Company had an accumulated deficit of $344,043,452, a
stockholders' deficiency of $13,273,981, a working capital
deficiency of $3,597,743, and a net loss and negative cash flows
from operating activities for the three months ended December 31,
2004 of $208,616 and $203,147, respectively. The Company has
insufficient capital to fund all of its obligations. The Company
also sold its remaining operating business during the year ended
September 30, 2004. These conditions raise substantial doubt about
the Company's ability to continue as a going concern. The
condensed consolidated financial statements do not include any
adjustments to reflect the possible future effect of the
recoverability and classification of assets or the amounts and
classifications of liabilities that may result from the outcome of
this uncertainty. The Company's independent registered public
accounting firm, in its report dated December 17, 2004, included
an explanatory paragraph stating that the Company's recurring
losses and accumulated deficit, working capital deficiency and
negative cash flow, among other things, raise substantial doubt
about the Company's ability to continue as a going concern.
* Wilmer Cutler Forms Public Policy Practice
--------------------------------------------
Wilmer Cutler Pickering Hale and Dorr LLP formed a Public Policy
and Strategy practice to be co-chaired by C. Boyden Gray, former
Counsel to President George H.W. Bush, and Jamie Gorelick, former
Deputy Attorney General and Department of Defense General Counsel.
Three lawyers returning to the firm:
-- Robert M. Kimmitt, former Ambassador to Germany;
-- Edward T. Tobin III, former Executive Director of the
Republican Governors Association; and
-- Reginald J. Brown, former Special Assistant and Associate
Counsel to President George W. Bush
will help lead this practice.
Mr.Tobin will serve as Vice Chair of the practice group, as will
Todd Stern, former Staff Secretary for President Bill Clinton and
Counselor to the Secretary of the Treasury. The practice will
call upon the skills of scores of partners with senior level
government experience.
Business today increasingly faces the challenge of limiting
reputational as well as legal exposure, and major companies at
home and abroad are seeking seasoned counsel capable of providing
strategic advice that integrates legal, public policy, political
and even media considerations. The Public Policy and Strategy
practice consolidates the extensive work that the firm's lawyers
do across the public policy landscape, from providing broad-gauged
advice to companies or industries on how to manage public policy
risk, to crafting legislative or regulatory solutions to problems,
to strategic support for proposed business transactions or
initiatives, to crisis management and the response to
congressional investigations.
"We are pleased to be able to offer our clients bi-partisan
solutions to the policy challenges they face," said William F. Lee
and William J. Perlstein, co-managing partners of Wilmer Cutler
Pickering Hale and Dorr. "Today, businesses must manage policy
risk just as they manage financial and operational risk. The
Public Policy and Strategy practice will fill that role for our
clients."
Messrs. Kimmitt, Tobin, and Brown will join the new practice
group. Mr. Kimmitt practiced at Wilmer, Cutler & Pickering from
1997-2000; Mr. Tobin previously practiced at Hale and Dorr from
1990-1993; and Mr. Brown practiced at the firm from 1997-99. The
two firms merged in May 2004.
"These three lawyers bring a wealth of experience in the public
policy arena," said Perlstein and Lee, "and we are confident they,
along with Jamie Gorelick, Boyden Gray and other Wilmer Hale
lawyers here with relevant government experience will quickly
establish the Public Policy and Strategy practice as a leader in
the area."
Robert M. Kimmitt
Mr. Kimmitt is the former US Ambassador to Germany, a position he
held from 1991-93. From 1989-91, Mr. Kimmitt was Under Secretary
of State for Political Affairs. From 1985 to 1987, Mr. Kimmitt
served as General Counsel to the US Treasury Department. From
1983-85 he was Deputy Assistant to the President for National
Security Affairs at the White House.
In a career spanning four decades, he has not only served in
numerous capacities in the US government, but he has also worked
at the highest levels of major corporations and spent many years
in private legal practice. His varied legal, government and
executive experience will be invaluable to companies doing
business across oceans and international borders.
Most recently, Mr. Kimmitt was Executive Vice President for Global
Public Policy at Time Warner, where he now serves as Chairman of
the Time Warner International Advisory Council. Prior to joining
Time Warner, he was Vice Chairman and President of Commerce One, a
software company headquartered in San Francisco. As partner at
Wilmer, Cutler & Pickering until 2000, Mr. Kimmitt focused on
international transactions in regulated industries, especially in
areas of defense, aerospace, telecommunications and banking.
In addition to joining the Public Policy and Strategy practice,
Kimmitt will also be a member of the firm's Defense, National
Security and Government Contracts practice group.
Edward T. Tobin III
As Executive Director of the Republican Governors Association
(RGA), Mr. Tobin successfully established the RGA as an
independent political organization and served as the Republican
Governors' primary liaison to the White House, senior
Administration officials and Congressional leaders regarding
public policy matters. During his three- year tenure, Tobin
helped increase the Republican majority in the nation's
statehouses. Earlier in his career, Mr. Tobin served as Chief
Secretary to Massachusetts Governor William Weld.
Mr.Tobin brings to the practice expertise in both state and
federal policy making and a practical understanding of the policy
needs of the firm's corporate clients. He served as Deputy
General Counsel for Corporate Affairs at Microsoft Corporation in
Redmond, Washington and Vice President for Public Policy at US
WEST, Inc. As a litigator at Hale and Dorr, Mr. Tobin handled
white-collar criminal cases and business litigation.
In addition to serving as Vice Chair of the Public Policy and
Strategy practice, Mr. Tobin will be a member of the Government
Litigation and Strategy practice group and the Investigations and
Criminal Litigation practice group.
Reginald J. Brown
Mr. Brown most recently served as Special Assistant and Associate
White House Counsel to President George W. Bush. He was the lead
lawyer for the White House Office of Political Affairs through the
2004 Presidential election cycle, and served as the White House
Counsel's Office liaison to the Departments of Treasury and
Housing and Urban Development. Like Messrs. Kimmitt and Tobin,
Mr. Brown's practical experience also spans the policy and
corporate landscape. He previously served as Assistant to the CEO
and Vice President of Corporate Strategy at Nationwide Mutual
Insurance Company and as the Deputy General Counsel to Florida
Governor Jeb Bush. Mr. Brown was a regulatory lawyer and
litigator at Wilmer, Cutler & Pickering from 1997-99 in the firm's
financial services and international practice groups.
In addition to joining the Public Policy and Strategy practice,
Mr. Brown will also be a member of the firm's Financial
Institutions practice group.
About Wilmer Cutler
Wilmer Cutler Pickering Hale and Dorr LLP --
http://www.WilmerHale.com/-- is nationally and internationally
recognized for its premier practices in antitrust and competition;
bankruptcy; civil and criminal trial and appellate litigation
(including white collar defense); communications; corporate
(including public offerings, public company counseling, start-up
companies, venture capital, mergers and acquisitions, and
licensing); defense and national security; financial institutions;
intellectual property counseling and litigation; international
arbitration; life sciences; securities regulation, enforcement and
litigation; tax; and trade. Wilmer Cutler Pickering Hale and Dorr
LLP was formed in May 2004 through the merger of two of the
nation's leading law firms, Hale and Dorr LLP and Wilmer Cutler
Pickering LLP. With a staunch commitment to public service, the
firm is renowned as a national leader in pro bono representation.
The firm has more than 1,000 lawyers and offices in Baltimore,
Beijing, Berlin, Boston, Brussels, London, Munich, New York,
Northern Virginia, Oxford, Waltham and Washington, DC.
* Understanding A.M. Best's Ratings for Canadian Insurers
---------------------------------------------------------
The objective of A.M. Best Co.'s rating system is to provide an
opinion of an insurer's financial strength and ability to meet
ongoing obligations to policyholders.
Based on a recently released rating methodology, the assignment of
an interactive rating is derived from an in-depth evaluation of a
company's balance sheet strength, operating performance and
business profile as compared with A.M. Best's quantitative and
qualitative standards.
A.M. Best's quantitative evaluation is based on an analysis of
more than 100 key financial tests and supporting data. These
tests, which underlie the evaluation of balance sheet strength and
operating performance, vary in their importance depending on a
company's characteristics.
A company's quantitative results are evaluated on their own merits
and also are compared with industry composites as established by
A.M. Best. Composite standards are based on the performance of
other Canadian insurance companies with comparable business mixes.
These industry benchmarks are adjusted when needed to reflect
changes in underwriting, economic and regulatory market
conditions.
A company's underwriting, financial and asset leverage are
subjected to an evaluation by Best's Capital Adequacy Ratio
(BCAR), which allows for an integrated review of these leverage
areas. BCAR calculates the net required capital to support the
financial risks of the company associated with the exposure of
assets and underwriting to adverse economic and market conditions
and compares it with economic capital. Some of the stress tests
within BCAR include above-normal catastrophes, a decline in equity
markets and a rise in interest rates. This integrated stress
evaluation permits a more discerning view of a company's balance
sheet strength relative to its operating risks.
Structurally, A.M. Best's Canadian BCAR model is adapted
specifically to the Canadian P&C-1 and P&C-2 Annual Statements as
well as Canada's GAAP (generally accepted accounting principles)
accounting standards. A.M. Best's Canadian capital formula takes
a risk-based capital approach. Net required capital is calculated
to support three broad risk categories: investment risk, credit
risk and underwriting risk. However, A.M. Best's capital adequacy
formula contains an adjustment for covariance, reflecting the
statistical independence of the individual components. A
company's adjusted surplus is divided by its net required capital,
after the covariance adjustment, to determine its BCAR.
A.M. Best makes a number of adjustments to a company's reported
surplus within the Canadian capital model to provide a more
economic and comparable basis for evaluating capital adequacy.
Goodwill and other intangible assets are eliminated. Other
significant adjustments are related largely to equity, or economic
values, imbedded in loss and loss-adjustment expense reserves,
fixed-income securities and common stocks. Further adjustments
are made to surplus to reflect the pricing risk inherent in
unearned premium reserves and nonbalance sheet risks, including
catastrophe exposures and debt-service requirements.
Generally, more than two-thirds of a company's gross capital
requirement within A.M. Best's Canadian capital model is generated
from its loss reserve and net premiums written components.
Consequently, a company's absolute BCAR value is influenced
largely by the capital required to support its net underwriting
commitment, which in turn is largely a function of its business
mix, surplus size, stability of loss development, profitability,
loss reserve adequacy and length of claims payout.
While only one-third of the gross capital requirement is generated
from investment risk, interest-rate risk and credit risk
components, a company that maintains a more aggressive investment
portfolio, is heavily dependent on pyramided capital, has
excessive credit risk or is excessively dependent on reinsurance,
likely will generate a lower BCAR value.
To access the BCAR rating methodology for Canadian P/C insurers,
visit http://www.ambest.com/ratings/methodology
A.M. Best Co. -- http://www.ambest.com/-- established in 1899, is
the world's oldest and most authoritative insurance rating and
information source.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
April 7-8, 2005
PRACTISING LAW INSTITUTE
27th Annual Current Developments in Bankruptcy &
Reorganization
San Francisco, CA
Contact: 1-800-260-4PLI; 212-824-5710 or info@pli.edu
April 8-9, 2005
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
The NABT Spring Seminar
Don CeSar Beach Resort St. Petersburg, FL
Contact: 803-252-5646 or info@nabt.com
April 13, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Mediation in Turnarounds & Bankruptcies
Milleridge Cottage Long Island, NY
Contact: 312-578-6900 or http://www.turnaround.org/
April 14-15, 2005
BEARD GROUP AND RENAISSANCE AMERICAN MANAGEMENT CONFERENCES
The Sixth Annual Conference on Healthcare Transactions
Successful Strategies for Mergers, Acquisitions,
Divestitures and Restructurings
The Millennium Knickerbocker Hotel, Chicago
Contact: 1-800-726-2524; 903-595-3800 or
dhenderson@renaissanceamerican.com
April 19, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Wilbur Ross - Joint Breakfast Meeting with Association for
Corporate Growth
Woodbridge Hilton, Iselin, NJ
Contact: 908-575-7333 or http://www.turnaround.org/
April 20, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TMA Florida Chapter / Finance Network Club Spring Dinner
Sheraton Suites Cypress Creek, Ft. Lauderdale, FL
Contact: 561-882-1331 or http://www.turnaround.org/
April 21, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TMA South Florida Golf Day
Carolina Club, Margate, FL
Contact: 561-882-1331 or http://www.turnaround.org/
April 21, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TBA [Upstate New York]
Contact: 716-440-6615 or http://www.turnaround.org/
April 21, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Colorado TMA Breakfast
The Oxford Hotel, Denver, CO
Contact: 303-457-2119 or http://www.turnaround.org/
April 26, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Tampa Luncheon
The Centre Club Tampa, FL
Contact: 303-457-2119 or http://www.turnaround.org/
April 28, 2005
AMERICAN BANKRUPTCY INSTITUTE
Bankruptcy Fundamentals: Nuts & Bolts for Young
Practitioners (East)
J.W. Marriott Washington, D.C.
Contact: 1-703-739-0800 or http://www.abiworld.org/
April 28- May 1, 2005
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
J.W. Marriot, Washington, D.C.
Contact: 1-703-739-0800 or http://www.abiworld.org/
May 4, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon Meeting
Union League Club, NYC
Contact: 646-932-5532 or http://www.turnaround.org/
May 9, 2005
AMERICAN BANKRUPTCY INSTITUTE
New York City Bankruptcy Conference
Millenium Broadway New York, New York
Contact: 1-703-739-0800 or http://www.abiworld.org/
May 10, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Errors, Omissions and Fraud
Newark Club, NJ
Contact: 908-575-7333 or http://www.turnaround.org/
May 12-14, 2005
ALI-ABA
Fundamentals of Bankruptcy Law
Washington, D.C.
Contact: 1-800-CLE-NEWS or http://www.ali-aba.org/
May 12-14, 2005
ALI-ABA
Fundamentals of Bankruptcy Law
Santa Fe, NM
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
May 13, 2005
AMERICAN BANKRUPTCY INSTITUTE
Bankruptcy Fundamentals: Nuts & Bolts for Young
Practitioners (N.Y.C.)
Association of the Bar of the City of New York, New York
Contact: 1-703-739-0800 or http://www.abiworld.org/
May 17, 2005
NEW YORK INSTITUTE OF CREDIT
26th Annual Credit Smorgasbord
Arno's Ristorante, NYC
Contact: 212-551-7920 or http://www.nyic.org/
May 19, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Colorado TMA May Breakfast
The Oxford Hotel, Denver, CO
Contact: 303-457-2119 or http://www.turnaround.org/
May 19-20, 2005
BEARD GROUP AND RENAISSANCE AMERICAN MANAGEMENT CONFERENCES
The Second Annual Conference on Distressed Investing Europe
Maximizing Profits in the European Distressed Debt Market
Le Meridien Piccadilly Hotel London UK
Contact: 1-800-726-2524; 903-595-3800 or
dhenderson@renaissanceamerican.com
May 19-20, 2005
TURNAROUND MANAGEMENT ASSOCIATION
2nd Annual Golf Tournament [Carolinas]
Venue - TBA
Contact: 704-926-0359 or http://www.turnaround.org/
May 19-20, 2005
TURNAROUND MANAGEMENT ASSOCIATION
4th Annual Great Lakes Regional Conference
Peek'N Peak Resort, Findley Lake, NY
Contact: 716-440-6615 or http://www.turnaround.org/
May 23, 2005 (tentative)
TURNAROUND MANAGEMENT ASSOCIATION
Long Island TMA Golf Outing
Indian Hills, Northport, LI
Contact: 516-465-2356; 631-434-9500
or http://www.turnaround.org/
May 23-26, 2005
AMERICAN BANKRUPTCY INSTITUTE
Litigation Skills Symposium
Tulane University Law School New Orleans, Louisiana
Contact: 1-703-739-0800 or http://www.abiworld.org/
May 31, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Orlando Luncheon
Citrus Club, Orlando, FL
Contact: 561-882-1331 or http://www.turnaround.org/
June 1, 2005 (Date is tentative)
TURNAROUND MANAGEMENT ASSOCIATION
12th Annual Charity Golf Tournament
Venue - TBA
Contact: 203-877-8824 or http://www.turnaround.org/
June 2-4, 2005
ALI-ABA
Partnerships, LLCs, and LLPs: Uniform Acts, Taxation,
Drafting, Securities and Bankruptcy
Omni Hotel, San Francisco
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
June 6, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TMA New York Golf Tournament (for members only.)
Fresh Meadows Country Club, Lake Success, NY
Contact: 646-932-5532 or http://www.turnaround.org/
June 7, 2005
NEW YORK INSTITUTE OF CREDIT
NYIC 86th Annual Award Banquet
New York Hilton and Towers, NYC
Contact: 212-551-7920 or http://www.nyic.org/
June 8, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TMA-LI Women's Marketing Initiative: Afternoon Tea
Milleridge Inn, Long Island, NY
Contact: 516-465-2356 or 631-434-9500 or
http://www.turnaround.org/
June 9-10, 2005
TURNAROUND MANAGEMENT ASSOCIATION
3rd Annual Mid-Atlantic Regional Symposium
Atlantic City, NJ
Contact: 908-575-7333 or http://www.turnaround.com/
June 9-11, 2005
ALI-ABA
Chapter 11 Business Reorganizations
Charleston, South Carolina
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
June 16-19, 2005
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort Traverse City, Michigan
Contact: 1-703-739-0800 or http://www.abiworld.org/
June 16, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TBA [Upstate New York]
Rochester, NY
Contact: 716-440-6615 or http://www.turnaround.org/
June 16, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Colorado TMA Breakfast
The Oxford Hotel, Denver, CO
Contact: 303-457-2119 or http://www.turnaround.org/
June 23-24, 2005
BEARD GROUP AND RENAISSANCE AMERICAN MANAGEMENT CONFERENCES
The Eighth Annual Conference on Corporate Reorganizations
Successful Strategies for Restructuring Troubled Companies
The Millennium Knickerbocker Hotel, Chicago
Contact: 1-800-726-2524; 903-595-3800 or
dhenderson@renaissanceamerican.com
June 28, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Tampa Luncheon
The Centre Club Tampa, FL
Contact: 561-882-1331 or www.turnaround.org
June 28, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Family Night - Somerset Patriots Baseball
Commerce Bank Ballpark, Bridgewater, NJ
Contact: 908-575-7333 or www.turnaround.org
July 1, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Long Island Chapter Manhattan Cruise (In Planning - Watch
for Announcement)
Departing from Manhattan
Contact: 516-465-2356; 631-434-9500
or http://www.turnaround.org/
July 8, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Body of Knowledge Law Review (in preparation for the CTP
exam) [Chicago/Midwest]
Venue - TBA
Contact: 815-469-2935 or http://www.turnaround.org/
July 14-17, 2005
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Ocean Edge Resort, Brewster, Massachusetts
Contact: 1-703-739-0800 or http://www.abiworld.org/
July 27-30, 2005
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
Kiawah Island Resort and Spa, Kiawah Island, S.C.
Contact: 1-703-739-0800 or http://www.abiworld.org/
August 1, 2005
TURNAROUND MANAGEMENT ASSOCIATION
NJTMA Annual Golf Outing
Raritan Valley Country Club, Bridgewater, NJ
Contact: 908-575-7333 or http://www.turnaround.org/
August 4, 2005
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Cambridge, Maryland
Contact: 1-703-739-0800 or http://www.abiworld.org/
August 17-21, 2005
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
NABT Convention
Marriott Marquis Times Square New York, NY
Contact: 803-252-5646 or info@nabt.com
August 19, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Annual Fishing Trip
Point Pleasant, NJ
Contact: 908-575-7333 or http://www.turnaround.org/
August 19, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Body of Knowledge Accounting Review [Chicago/Midwest]
Venue - TBA
Contact: 815-469-2935 or http://www.turnaround.org/
September 8-9, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Golf Tournament and TMA Regional Conference
Gideon Putnam Hotel, Saratoga Springs, NY
Contact: 716-667-3160 or http://www.turnaround.org/
September 8-11, 2005
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
(Including Financial Advisors/Investment Bankers Program)
The Four Seasons Hotel Las Vegas, Nevada
Contact: 1-703-739-0800 or http://www.abiworld.org/
September 12, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Annual TMA-LI Chapter Board Meeting
Venue - TBA
Contact: 516-465-2356 or http://www.turnaround.org/
September 15, 2005
TURNAROUND MANAGEMENT ASSOCIATION
7th Annual Lender's Forum: Surviving Bank Mergers
Milleridge Cottage, Long Island, NY
Contact: 516-465-2356; 631-434-9500
or http://www.turnaround.org/
September 15, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Colorado TMA Breakfast
The Oxford Hotel, Denver, CO
Contact: 303-457-2119 or http://www.turnaround.org/
September 16, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Body of Knowledge Management Review [Chicago/Midwest]
Venue - TBA
Contact: 815-469-2935 or http://www.turnaround.org/
September 22, 2005
TURNAROUND MANAGEMENT ASSOCIATION
3rd Annual Workout Lenders Panel Luncheon
Union League Club, NYC
Contact: 646-932-5532 or http://www.turnaround.org/
September 23, 2005
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Workshop
London, UK
Contact: 1-703-739-0800 or http://www.abiworld.org/
September 26, 2005
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Workshop
Site to Be Determined London, England
Contact: 1-703-739-0800 or http://www.abiworld.org/
September 28, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Joint CFA/RMA/TMA Networking Reception
Woodbridge Hilton, Iselin, NJ
Contact: 908-575-7333 or http://www.turnaround.org/
October 7, 2005
AMERICAN BANKRUPTCY INSTITUTE
Views from the Bench
Georgetown University Law Center Washington, D.C.
Contact: 1-703-739-0800 or http://www.abiworld.org/
October 18, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TBA [Upstate New York]
Rochester, NY
Contact: 716-440-6615 or http://www.turnaround.org/
October 19-23, 2005
TURNAROUND MANAGEMENT ASSOCIATION
2005 Annual Convention
Chicago Hilton & Towers, Chicago
Contact: 312-578-6900 or http://www.turnaround.org/
October 20, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Colorado TMA Breakfast
The Oxford Hotel, Denver, CO
Contact: 303-457-2119 or http://www.turnaround.org/
October 27, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Informal Networking *FREE Reception for Members*
The Davenport Press Restaurant, Mineola, NY
Contact: 516-465-2356 or http://www.turnaround.org/
November 1-2, 2005
INTERNATIONAL WOMEN'S INSOLVENCY & RESTRUCTURING CONFEDERATION
IWIRC 2005 Fall Conference
San Antonio, TX
Contact: http://www.iwirc.com/
November 2-5, 2005
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
Seventy Eighth Annual Meeting
San Antonio, Texas
Contact: http://www.ncbj.org/
November 11, 2005
AMERICAN BANKRUPTCY INSTITUTE
Detroit Consumer Bankruptcy Workshop
Wayne State University, Detroit, MI
Contact: 1-703-739-0800 or http://www.abiworld.org/
November 14, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Workout Workshop
Long Island, NY
Contact: 312-578-6900 or http://www.turnaround.org/
November 17, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TBA [Upstate New York]
Buffalo, NY
Contact: 716-440-6615 or http://www.turnaround.org/
November 17, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Colorado TMA Breakfast
The Oxford Hotel, Denver, CO
Contact: 303-457-2119 or http://www.turnaround.org/
December 1, 2005
AMERICAN BANKRUPTCY INSTITUTE
Bankruptcy Fundamentals: Nuts & Bolts for Young
Practitioners (West)
Hyatt Grand Champions Resort Indian Wells, California
Contact: 1-703-739-0800 or http://www.abiworld.org/
December 1-3, 2005
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Hyatt Grand Champions Resort, Indian Wells, Calif.
Contact: 1-703-739-0800 or http://www.abiworld.org/
December 8, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Gathering & Help for the Needy *FREE to Members*
Mack Hall at Hofstra University, Hempstead, NY
Contact: 516-465-2356 or http://www.turnaround.org/
December 8, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Annual Board of Directors Meeting
Rochester, NY
Contact: 716-440-6615 or http://www.turnaround.org/
March 30 - April 1, 2006
ALI-ABA
Partnerships, LLCs, and LLPs: Uniform Acts, Taxation,
Drafting, Securities, and Bankruptcy
Scottsdale, AZ
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
April 18-22, 2006
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
JW Marriott Washington, D.C.
Contact: 1-703-739-0800 or http://www.abiworld.org/
June 15-18, 2006
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort Traverse City, Michigan
Contact: 1-703-739-0800 or http://www.abiworld.org/
July 13-16, 2006
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Newport Marriott Newport, Rhode Island
Contact: 1-703-739-0800 or http://www.abiworld.org/
July 26-29, 2006
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz Carlton Amelia Island Amelia Island, Florida
Contact: 1-703-739-0800 or http://www.abiworld.org/
October 11-14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
2006 Annual Conference
Milleridge Cottage Long Island, NY
Contact: 312-578-6900 or http://www.turnaround.org/
November 30-December 2, 2006
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Hyatt Regency at Gainey Ranch Scottsdale, Arizona
Contact: 1-703-739-0800 or http://www.abiworld.org/
October 10-13, 2007
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Orlando, FL
Contact: http://www.ncbj.com/
September 24-27, 2008
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Scottsdale, AZ
Contact: http://www.ncbj.org/
2009 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Las Vegas, NV
Contact: http://www.ncbj.org/
2010 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
New Orleans, LA
Contact http://www.ncbj.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via e-mail
to conferences@bankrupt.com are encouraged.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania,
USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L.
Metzler, Emi Rose S.R. Parcon, Rizande B. Delos Santos, Jazel P.
Laureno, Cherry Soriano-Baaclo, Marjorie Sabijon, Terence Patrick
F. Casquejo, Christian Q. Salta, Jason A. Nieva, and Peter A.
Chapman, Editors.
Copyright 2005. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $675 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each. For subscription information, contact Christopher Beard
at 240/629-3300.
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