/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/051025.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, October 25, 2005, Vol. 9, No. 253 Headlines ACXIOM CORP: Earns $7.1 Million of Net Income in Second Quarter ALPHARMA INC: Sale Plan Cues S&P to Put Stable Outlook on B Rating AQUACELL TECHNOLOGIES: Wolinetz Lafazan Raises Going Concern Doubt ASARCO LLC: Wants Amendment to Environmental Clean-Up Budget OK'd ATA AIRLINES: Wants Lease Decision Period Stretched to December 31 ATHEROGENICS INC: Equity Deficit Tops $97 Million at Sept. 30 AUBURN FOUNDRY: Court Converts Ch. 11 Case to Ch. 7 Liquidation AUBURN FOUNDRY: Section 341 Meeting Set for January 26 Next Year AXIOM PROPERTIES: Voluntary Chapter 11 Case Summary BAKER TANKS: S&P Reviews Ratings Due to Lightyear Buy-Out Plans BEAR STEARNS: Fitch Rates $1.16M Certificate Class at B BENCHMARK ELECTRONICS: Earns $20.3MM of Net Income in 3rd Quarter BOYDS COLLECTION: Taps Houlihan Lokey as Financial Advisors BRICE ROAD: GE Credit Asks to Continue Foreclosure Action BURLINGTON INDUSTRIES: Trust Wants Court to Close Chapter 11 Cases CALPINE CORP: CCFC Raises $300 Million in Preferred Stock Sale CELESTICA INC: Incurs $19.6 Million Net Loss in Third Quarter CHARTER COMMS: CCO Holdings LLC Inks $600 Million Sr. Loan Pact COMMERCIAL MORTGAGE: S&P's Rating on Class J Certs. Tumbles to D CONSOLIDATED CONTAINER: J.M. Greene Replaces S.E. Macadam as CEO DANA CORP: S&P Chips Sr. Unsecured Credit Rating to BB from BB+ DAVID DEEGAN: Case Summary & 20 Largest Unsecured Creditors DE KALB HOUSING: S&P Downgrades $1.3 Mil Bond Rating to D from C DELPHI CORP: Gets Interim Injunction Against Utility Companies DELTA AIR: Comair to Cut 1,000 Jobs & Reduce Fleet by 30 Aircraft DELTA AIR: Wants to Pay Chicago $1,092,630 on Oct. 31 for Bonds DELTA AIR: Wants to Enter Into Section 1110(a) Stipulations DENBURY RESOURCES: Shareholders Approve 2-for-1 Stock Split DIDIER ROGEZ: Case Summary & 6 Largest Unsecured Creditors DOMINIQUE LTD: Voluntary Chapter 11 Case Summary E*TRADE FINANCIAL: Earns $107.5 Mil of Net Income in Third Quarter ENRON CORP: Court Approves JPMorgan Settlement on L/C Disputes ENRON CORP: Gets Court Nod on TPL Guaranty Claims Settlement Pact ENRON CORP: Court Approves General Electric Settlement Agreement EXIDE TECH: Compensation Actions for Four Senior Officers Approved FEDERAL-MOGUL: Incurs $48 Million Net Loss in Third Quarter FLYI INC: NASDAQ Says Market Cap Must Top $15 Million by Jan. 19 FOAMEX INT'L: Gets Final Court Approval on $320-Mil DIP Facility FOAMEX INT'L: Can Employ Miller Buckfire as Financial Advisor FOAMEX INT'L: Court Sets December 5 as General Claims Bar Date FREEDOM RINGS: Wants Young Conaway as Bankruptcy Counsel FREEDOM RINGS: Wants Donlin Recano as Claims & Noticing Agent GOLD KIST: Moody's Affirms $130 Million Unsec. Notes' Rating at B2 HEILIG-MEYERS: Inks Settlement Pact with Prepetition Lenders HOANG NGUYEN: Case Summary & 16 Largest Unsecured Creditors HUDSON VALLEY: Columbia Agency Slams Cash Collateral & DIP Funding HUDSON VALLEY: Wants Access to Whittier & Greenleaf's Collateral INLAND FIBER: Noteholders Disclose Info on Confidentiality Pacts INTEGRATED HEALTH: Ct. Okays Reward & Coverage Lawsuit Settlement INTERSTATE BAKERIES: Gets Court Nod to Hire Jefferson Wells INTERSTATE BAKERIES: Can Walk Away from 11 Real Estate Leases IWO HOLDINGS: Sprint Buy-Out Cues S&P to Lift Junk Rating to BBB JAMESTOWN HOUSING: S&P Slices Rating on $2.7M Bonds to B from BB JERRY RUTHERFORD: Case Summary & 20 Largest Unsecured Creditors KENNETH MEAD: Case Summary & 13 Largest Unsecured Creditors KINGSLEY COACH: Mantyla McReynolds Raises Going Concern Doubt LAIDLAW INT'L: Promotes Four Executives to VP Positions LEONARD SIEMASZ: Case Summary & 20 Largest Unsecured Creditors MARGARET HUDNALL: Case Summary & 12 Largest Unsecured Creditors MERIDIAN AUTOMOTIVE: Panel Can Hire Bifferato as Conflicts Counsel MERIDIAN AUTOMOTIVE: Credit Suisse Wants Jury Trial to Fix Claims METALFORMING TECH: Wants Exclusive Period Stretched to Feb. 11 METALFORMING TECH: Has Until Dec. 13 to Remove Civil Actions MICHAEL PERSON: Case Summary & Largest Unsecured Creditor MICHAEL SEBASTIAN: Case Summary & 17 Largest Unsecured Creditors MICHAEL WILEY: Voluntary Chapter 11 Case Summary MORAN MATERIALS: Case Summary & 20 Largest Unsecured Creditors NORTHWEST AIRLINES: East Texas Lobbies for Equity Committee NOVA CHEMICALS: S&P Rates $300 Mil Senior Unsecured Notes at BB+ O'SULLIVAN INDUSTRIES: Gets Court Nod to Keep Investing Funds O'SULLIVAN INDUSTRIES: Can Continue Using Existing Business Forms ORGANIZED LIVING: Court Sets Nov. 15 Bar Date for Gift Card Claims OSWALD BURRELL: Voluntary Chapter 11 Case Summary PC LANDING: Judge Walsh Approves Disclosure Statement Supplement PC LANDING: Wants Exclusive Period Stretched to December 18 PETROKAZAKHSTAN INC: Gets Securityholders' Nod on CNPC Buy-Out PRECISION CASTINGS: Case Summary & 20 Largest Unsecured Creditors PUERTO RICO INDUSTRIAL: S&P Shaves Bond Ratings to B- from B+ RADNOR HOLDINGS: PwC Replaces KPMG as Independent Accountants REFCO INC: Bank of America Asks Court for Adequate Protection REFCO INC: Wants Court Okay to Maintain Existing Bank Accounts RGIS INVENTORY: S&P Assigns Low-B Ratings on Proposed $570M Loans ROBOTIC VISION: Chap. 7 Trustee Sets Creditors Meeting on Nov. 16 S-TRAN HOLDINGS: Gets Interim OK to Continue Using Cash Collateral SHAW GROUP: Earns $17.9 Million of Net Income in Fourth Quarter STRESSGEN BIOTECH: Raising $2.625 Mil. in Private Equity Placement STRESSGEN BIOTECHNOLOGIES: European Patent Office Upholds Patent SWIFT & CO: S&P Reviews BB- Corp. Credit Rating & May Downgrade TIMOTHY MCCORMICK: Case Summary & 20 Largest Unsecured Creditors THISTLE MINING: Expects to Spend $4.5 Million in African Job Cuts TIME WARNER: S&P Junks $240-Mil. Senior Secured Notes After Review TITANIUM METALS: H.C. Simmons Replacing J.L. Martin as CEO TITANIUM METALS: Declares Dividend on 6-3/4% Series A Pref. Stock TOYS "R" US: S&P Junks Senior Unsecured Notes After Review TRISTAR HOTEL: Sec. 341(a) Meeting Continued to October 26 UAL CORP: Wants Settlement on Barclays' $14.4 Million Claim Okayed UAL CORP: Wants Court to Approve VX Capital Aircraft Settlement UAL CORP: Inks Pact Resolving Disputes with NJ Treasury Department VERITAS DGC: S&P Assigns BB Rating on $155 Million Senior Notes VIA NET.WORKS: Completes Sale of All Operations to Interoute VISTEON CORP: Audit Panel Completes Independent Accounting Review WILLIAM COYLE: Case Summary & 16 Largest Unsecured Creditors WINN-DIXIE: Trade Creditors Transferrs More Than $5 Mil. Claims * John Bambach Joins NachmanHaysBrownstein as Managing Director * NachmanHaysBrownstein Elects Jason Consoli as Managing Director * TMA Launches Programs to Assist Businesses Hit by Katrina * Large Companies with Insolvent Balance Sheets ********* ACXIOM CORP: Earns $7.1 Million of Net Income in Second Quarter --------------------------------------------------------------- Acxiom(R) Corporation (Nasdaq: ACXM) reported financial results for the second quarter of fiscal 2006 ended Sept. 30, 2005. Revenue for the quarter was $330.5 million, income from operations was $18.8 million and pre-tax earnings were $12.4 million. These results include the impact of net pre-tax charges of $15.8 million associated with the restructuring plan, the sale of non-strategic operations and two unusual items. The impact of these items on net earnings after tax was $10.4 million, which reduced diluted EPS by $.12 for the quarter. "During our second quarter, we saw 11 percent year-over-year revenue improvement, the expense-reduction initiative we announced in June produced better than expected results, our business in Europe improved, and we signed a number of large, new deals," Company Leader Charles D. Morgan said. "These results give us an encouraging outlook for the third and fourth quarters." For the three months ended Sept. 30, 2005, Acxiom reported $7.1 million of net income, compared to an $18.5 million net income for the same period in 2004. "Our profit improvement plan helped us achieve $11 million in pre- tax cost savings in the second quarter, and we will continue to realize benefits from our operational initiatives, including ongoing expense management and an intense focus on performance metrics," Company Operations Leader Lee Hodges said. "We expect those initiatives to contribute more than $15 million in the third quarter and in each subsequent quarter going forward." Mr. Morgan noted that Acxiom recently completed new contracts with Washington Mutual Inc. (formerly Providian), NDCHealth Corporation, MGM MIRAGE, Yellow Book USA and Reliance Insurance. "The amount and nature of the new contracts we signed in the quarter certainly give us reason for optimism," Mr. Morgan said. "For example, the NDCHealth deal is particularly significant, as it represents our third grid computing-based data center re- engineering project." Headquartered in Little Rock, Arkansas, Acxiom Corporation (Nasdaq: ACXM) integrates data, services and technology to create and deliver customer and information management software for many of the largest, most respected companies in the world. The core components of Acxiom's innovative solutions are Customer Data Integration technology, data, database services, IT outsourcing, consulting and analytics, and privacy leadership. * * * As reported in the Troubled Company Reporter on July 15, 2005, Standard & Poor's Ratings Services affirmed its 'BB+' corporate credit rating on Little Rock, Arkansas-based Acxiom Corp. At the same, the outlook was revised to negative from positive, reflecting the offer from the company's largest shareholder to buy the remainder of the company's shares for $23 per share. "At this time, Standard & Poor's does not know how the company will respond to this offer, and whether defensive measures might be used to counter these actions," said Standard & Poor's credit analyst Philip Schrank. Acxiom currently has no rated debt. ALPHARMA INC: Sale Plan Cues S&P to Put Stable Outlook on B Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services revised its rating outlook on drug maker Alpharma Inc. to stable from negative. Ratings on the company, including the 'B' corporate credit rating, were affirmed. "The outlook revision is in response to Alpharma's definitive agreement to sell its troubled global generic drug business to Iceland-based generic drug maker Actavis Group for $810 million in cash," explained Standard & Poor's credit analyst Arthur Wong. The deal is expected to close by year-end 2005. Alpharma plans to use the proceeds to repay debt and expand its specialty branded drug business. The low-speculative-grade rating reflects Alpharma's deteriorating position in the increasingly competitive generic drug market. The company's generic drug business generated $776 million in 2004 sales and accounted for 68% of total revenues. In an industry where a timely continuous flow of new products and efficient manufacturing operations are essential, Alpharma faced long-running FDA noncompliance issues at two of its main facilities, which hindered its ability to launch new products. Consequently, the company's competitive position eroded. This accounts for the relatively low multiple of roughly 1x sales that Actavis is paying for Alpharma's generic drug business. Upon the close of the transaction, Alpharma will transform from a highly levered company, at nearly 5x debt to EBITDA, to a company in a net cash position. Alpharma plans to totally eliminate its existing debt by mid 2006, when its roughly $160 million in convertible debt comes due. S&P expects the company to have $150 million-$200 million in cash at that time to invest in its remaining businesses, specifically the specialty branded drug franchise. AQUACELL TECHNOLOGIES: Wolinetz Lafazan Raises Going Concern Doubt ------------------------------------------------------------------ Wolinetz, Lafazan & Company, PC, expressed substantial doubt about AquaCell Technologies, Inc.'s ability to continue as a going concern after it audited the Company's financial statements for the fiscal year ended June 30, 2005. The auditing firm points to the Company's significant operating losses for the years ended June 30, 2005, and 2004 as well as its working capital and stockholders' deficiency at June 30, 2005. In its Form 10-KSB for the fiscal year 2005 submitted to the Securities and Exchange Commission on Oct. 12, 2005, AquaCell reports a $3,888,000 net loss compared to a $4,512,000 net loss in fiscal 2004. Management attributes the decrease in net loss to a $144,000 decrease in impairment loss on goodwill, a $48,000 write-off of accrued interest on notes receivable and a fair value adjustment of a derivative totaling $333,000. The Company's balance sheet showed $2,383,000 of assets at June 30, 2005, and liabilities totaling $2,474,000. At June 30, 2005, the Company had a $1,671,000 working capital and $91,000 stockholders' deficiency. To address its liquidity problems, AquaCell intends to continue raising capital through the sale or exercise of equity securities. For the fiscal year ended June 30, 2005, the Company raised net equity of approximately $1,549,000 through the exercise of warrants to purchase common shares and private placements of common shares and Series B Convertible Preferred stock. In addition, the Company has continued to pursue the placement of its water cooler "billboards" in various locations and the Company is seeking to increase its revenues through the sale of advertising on the band of the cooler's permanently attached five- gallon bottle. AquaCell Technologies, Inc. -- http://www.aquacell.com/-- has two operating subsidiaries, AquaCell Media, Inc., which operates in the out-of-home advertising segment of the advertising industry, and AquaCell Water Inc., fka Water Science Technologies, Inc., which is engaged in the manufacture and sale of products for water filtration and purification, addressing various water treatment applications for municipal, industrial, commercial, and institutional purposes. ASARCO LLC: Wants Amendment to Environmental Clean-Up Budget OK'd ----------------------------------------------------------------- As previously reported, Southern Peru Holdings Corporation contemplated on selling its stock holdings and majority interest in Southern Peru Copper Corp. to ASARCO LLC's parent, Americas Mining Corporation. ASARCO has environmental liabilities to the United States Government pursuant to certain consent decrees, administrative orders, or environmental statutes. The U.S. Government later filed a complaint against ASARCO and Southern Peru Holdings in the United States District Court for the District of Arizona, wherein the Government sought a judgment declaring that the proposed terms of the Sale violated various provisions of the Federal Debt Collection Procedures Act of 1990 and the Federal Priorities Act. The Complaint also sought preliminary and injunctive relief enjoining the sale and transfer. On Feb. 2, 2003, the Arizona Court approved a consent decree entered into among ASARCO and Southern Peru Holdings, on the one hand, and the Government, on the other hand. Pursuant to the settlement, ASARCO agreed to set up a $100 million environmental trust for pollution cleanup, in return for permission to sell SPCC. The consent decree establishes an annual budgeting process that discusses the allocation of funds from the trust at various sites. The parties agreed that once a budget has been established, amendments will be allowed. Pursuant to an order entered on Aug. 24, 2005, Judge Schmidt authorized ASARCO to consent to an amendment to the 2005 budget with regard to remediation and testing work at a site in Ruston, Washington. James R. Prince, Esq., at Baker Botts, L.L.P., in Dallas, Texas, relates that the existing 2005 annual budget contemplates expenditures of both trust funds and ASARCO's general corporate funds for work being done at the Ruston Site, as well as at: -- the Circle Smelting site in Beckemeyer; -- the California Gulch site; -- the East Helena site in Soils; -- the Mike Horse/Upper Blackfoot Mining Complex site; and -- the Everett site. Mr. Prince informs Judge Schmidt that ASARCO's work at the Sites came to a halt on the Petition Date. Because the liabilities relating to the Sites are dischargeable prepetition obligations, ASARCO cannot continue spending its general corporate funds on its work at the Sites. However, ASARCO does not believe that the funds in the environmental trust are property of its estate. Therefore, those funds are available to continue its work at the Sites, provided that the parties consent to an amendment of the 2005 budget. ASARCO seeks Judge Schmidt's permission to consent to a second amendment of the 2005 Annual Budget. Mr. Prince asserts that the amendment of the 2005 annual budget is necessary for the operation of ASARCO's business and is in the best interest of the estate. "Unless the Debtor is authorized to consent to the second amendment of the 2005 annual budget, the United States believes that the public health and safety could be jeopardized," Mr. Prince says. Headquartered in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors,it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. (ASARCO Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Service, Inc., 215/945-7000). ATA AIRLINES: Wants Lease Decision Period Stretched to December 31 ------------------------------------------------------------------ Pursuant to Section 365(d)(4) of the Bankruptcy Code, ATA Airlines, Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of Indiana to extend the deadline for them to assume, assume and assign, or reject unexpired leases of nonresidential real property up to and through Dec. 31, 2005. Terry E. Hall, Esq., at Baker & Daniels, in Indianapolis, explains that the Reorganizing Debtors' decision with respect to each Lease depends in large part on whether the location will play a future role under the Reorganizing Debtors' Plan. Whether each lease is assumed, assumed and assigned, or rejected will depend, most significantly, on whether the Reorganizing Debtors will continue operations at the location once the Plan is implemented. Ms. Hall notes that the Reorganizing Debtors' Chapter 11 Cases are large and complex. The Plan, filed on September 30, 2005, contemplates final decisions regarding the assumption or rejection of nonresidential real property leases and, to be consistent with the plan provisions, the Reorganizing Debtors' time to decide on the Lease should be extended, she asserts. 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. 38; Bankruptcy Creditors' Service, Inc., 215/945-7000) ATHEROGENICS INC: Equity Deficit Tops $97 Million at Sept. 30 ------------------------------------------------------------- AtheroGenics, Inc., (Nasdaq: AGIX) reported financial results for the third quarter and nine months ended September 30, 2005. Research and development expenses for the third quarter increased to $20.5 million, compared to $16.6 million for the comparable quarter in 2004. For the nine-month period ended Sept. 30, 2005, research and development expenses increased to $56 million, compared to $44.5 million for the same period in 2004. The increase in research and development spending in both periods resulted from higher clinical trial expenditures associated with the Company's AGI-1067 program, including the ongoing ARISE Phase III clinical study, partially offset by the conclusion in 2004 of two Phase II clinical studies, CART-2 with AGI-1067 and OSCAR with AGIX-4207. General and administrative expenses for the third quarter ended September 30, 2005, increased to $2.1 million compared to $1.4 million for the same period in 2004. For the nine months ended September 30, 2005, general and administrative expenses increased to $6.1 million compared to $4.8 million for the same period in 2004. The increase for both periods was due primarily to increased spending associated with pre-commercialization activities and expansion of the management team, as well as higher legal fees. AtheroGenics recorded interest expense of $2.3 million during the quarter, compared to interest expense of $1.3 million in the third quarter of 2004. Interest expense for the first nine months of 2005 was $6.6 million, as compared to interest expense of $3.9 million for the first nine months of 2004. The higher interest in 2005 is attributable to the $200 million principal amount of 1.5% convertible notes due 2012, issued by the Company in January 2005. AtheroGenics' net loss for the third quarter of 2005 was $23.1 million as compared to $19 million, or $0.51 per share, reported for the same period in 2004. Net loss for the first nine months of 2005 was $63.9 million as compared to a net loss of $52.1 million or $1.41 per share for the comparable period in 2004. At September 30, 2005, cash, cash equivalents and short-term investments totaled $196.7 million. AtheroGenics, Inc. -- http://www.atherogenics.com/--is focused on the discovery, development and commercialization of novel drugs for the treatment of chronic inflammatory diseases, including heart disease (atherosclerosis), rheumatoid arthritis and asthma. The Company has two drug development programs currently in the clinic. AtheroGenics' lead compound, AGI-1067, is being evaluated in the pivotal Phase III clinical trial called ARISE, as an oral therapy for the treatment of atherosclerosis. AGI-1096 is a novel, oral agent in Phase I that is being developed for the prevention of organ transplant rejection in collaboration with Fujisawa. AtheroGenics also has preclinical programs in rheumatoid arthritis and asthma using its novel vascular protectant(R) technology. As of September 30, 2005, the Company's equity deficit widened to $97,663,888, from a $35,942,382 deficit at December 31, 2004. AUBURN FOUNDRY: Court Converts Ch. 11 Case to Ch. 7 Liquidation --------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Indiana in Fort Wayne converted the chapter 11 case of Auburn Foundry, Inc., into a liquidation proceeding under chapter 7 of the Bankruptcy Code. In the pleading filed with the Bankruptcy Court, Dennis Maude, Auburn Foundry's Chief Financial Officer, contended that a conversion to chapter 7 would best serve the interests of the Debtor's estate and its creditors. The Debtor completed the sale of substantially all of its assets to SummitBridge National Investments, LLC, in June 2005. As reported in the Troubled Company reporter on May 10, 2005, Summit offered to purchase the Debtor's manufacturing plants and related assets located in the City of Auburn for an undisclosed amount. Headquartered in Auburn, Indiana, Auburn Foundry, Inc. -- http://www.auburnfoundry.com/-- produces iron castings for the automotive industry and automotive aftermarket industry. The Company filed for chapter 11 protection on February 8, 2004 (Bankr. N.D. Ind. Case No. 04-10427). John R. Burns, Esq., and Mark A. Werling, Esq., at Baker & Daniels, represent 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. AUBURN FOUNDRY: Section 341 Meeting Set for January 26 Next Year ---------------------------------------------------------------- The U.S. Trustee for Region 10 will convene a meeting of Auburn Foundry, Inc.'s creditors at 1:00 p.m. on January 26, 2006, at Room 1194, 1300 South Harrison Street in Fort Wayne, Indiana. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. In addition, the Bankruptcy Court set April 26, 2006, as the deadline for all creditors owed money by the Debtor on account of claims prior to Feb. 8, 2004 to file formal written proofs of claim. Creditors must deliver their claim forms to the: Clerk of the Bankruptcy Court Northern District of Indiana Fort Wayne Division 1300 South Harrison Street P.O. Box 2547 Fort Wayne, Indiana 46801-2547 Governmental units have until April 10, 2006, to file their proofs of claim. The Debtor originally filed for chapter 11 protection on Feb. 8, 2004. The Bankruptcy Court converted the chapter 11 case to a liquidation under chapter 7 of the bankruptcy code on Oct. 11, 2005. Headquartered in Auburn, Indiana, Auburn Foundry, Inc. -- http://www.auburnfoundry.com/-- produces iron castings for the automotive industry and automotive aftermarket industry. The Company filed for chapter 11 protection on February 8, 2004 (Bankr. N.D. Ind. Case No. 04-10427). John R. Burns, Esq., and Mark A. Werling, Esq., at Baker & Daniels, represent 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. AXIOM PROPERTIES: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Axiom Properties, LC 312 Northwest State Road American Fork, Utah 84003 Bankruptcy Case No.: 05-37672 Chapter 11 Petition Date: October 12, 2005 Court: District of Utah (Salt Lake City) Debtor's Counsel: Robert Fugal, Esq. Bird & Fugal 384 East 720 South, Suite 201 Orem, Utah 84058 Tel: (801) 426-4700 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. BAKER TANKS: S&P Reviews Ratings Due to Lightyear Buy-Out Plans --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on Baker Tanks Inc., including the 'B' corporate credit rating, on CreditWatch with developing implications. The CreditWatch placement follows the announcement that The Lightyear Fund L.P., a private equity firm, has entered into a definite purchase agreement to acquire Baker Tanks from Code Hennessy & Simmons LLC, another private equity firm. No details on the transaction have been provided. "If the acquisition is financed in such a way as to improve the company's financial profile, ratings could be raised," said Standard & Poor's credit analyst Betsy Snyder. "Alternatively, if the acquisition resulted in a weaker financial profile, ratings could be lowered," she continued. Ratings on Baker Tanks reflect the company's weak financial profile, and a modest revenue base in the narrow containment-rental-equipment industry segment. Ratings also incorporate the company's position as one of the larger suppliers of containment rental equipment in the U.S. and its relatively stable cash flow. Seal Beach, California-based Baker Tanks operates through a network of over 50 locations and maintains over 15,000 rental units, including steel tanks, polyethylene tanks, intermodal and roll-off containers/boxes, pumps, pipes, hose and fittings, tank trailers, berms, and filtration products. Baker Tanks' customers lease these products for: -- the storage of water, chemicals, and waste streams; -- transportation of solid waste; pumping of groundwater, municipal waste, and other fluids; and -- separation of solids and liquids. Code Hennessy & Simmons and management purchased the company from Hyatt Corp. in December 2003. The resolution of the CreditWatch will be based principally on Standard & Poor's assessment of the company's financial profile under the new owners. BEAR STEARNS: Fitch Rates $1.16M Certificate Class at B ------------------------------------------------------- Bear Stearns Asset Backed Securities Trust 2005-SD4 mortgage pass-through certificates, series 2005-SD4, are rated by Fitch Ratings: Group I Certificates: -- $189,077,338 class A, class I-X, and class I-PO 'AAA'; -- $9,454,000 class I-B-1 'AA'; -- $3,676,000 class I-B-2 'A'; -- $2,101,000 class I-B-3 'BBB'; -- $1,996,000 privately offered class I-B-4 'BB'; -- $1,155,000 privately offered class I-B-5 'B'. Group II Certificates: -- $155,072,000 classes II-A-1 and II-A-2 'AAA'; -- $11,457,000 class II-M-1 'AA'; -- $5,052,000 class II-M-2 'A'; -- $2,526,000 class II-M-3 'BBB'; -- $902,000 class II-M-4 'BBB-'. The 'AAA' rating on the Group I certificates reflects the 10.00% subordination provided by the 4.50% class I-B-1, 1.75% class I-B-2, 1.00% class I-B-3, 0.95% class I-B-4, 0.55% class I-B-5, and 1.25% class I-B-6. The 'AAA' rating on the Group II certificates reflects the 14.25% credit enhancement provided by the 6.35% class II-M-1, 2.80% class II-M-2, 1.40% class II-M-3, and 0.50% class II-M-4, along with overcollateralization and monthly excess interest. The initial OC for the Group II certificates is 3.00% with a target OC of 3.20%. In addition, the ratings on the certificates reflect the quality of the underlying collateral and Fitch's level of confidence in the integrity of the legal and financial structure of the transaction. The Group I mortgage pool consists of fixed-rate mortgage loans secured by first liens on one- to four-family residential properties, with an aggregate principal balance of $210,085,603. As of the cut-off date, Sept. 1, 2005, the mortgage loans had a weighted average loan-to-value ratio of 80.74%, weighted average coupon of 6.310%, and an average principal balance of $135,452. Single-family properties account for 85.83% of the mortgage pool, two- to four-family properties 3.66%, and condos 3.23%. Approximately 82.66% of the properties are owner occupied. The three largest state concentrations are California, Arizona, and Georgia. The Group II mortgage pool consists of adjustable-rate mortgage loans secured by first liens on one- to four-family residential properties, with an aggregate principal balance of $180,421,785. As of the cut-off date, Sept. 1, 2005, the mortgage loans had a weighted average LTV of 75.51%, WAC of 5.785%, and an average principal balance of $237,085. Single-family properties account for 73.54% of the mortgage pool, two- to four-family properties 3.31%, and condos 11.22%. Approximately 86.87% of the properties are owner occupied. The three largest state concentrations are California, Georgia, and Colorado. None of the mortgage loans are 'high cost' loans as defined under any local, state, or federal laws. For additional information on Fitch's rating criteria regarding predatory lending legislation, see the May 1, 2003, release entitled, 'Fitch Revises Rating Criteria in Wake of Predatory Lending Legislation' and the February 23, 2005, release entitled, 'Fitch Revises RMBS Guidelines for Antipredatory Lending Laws', available on the Fitch Ratings web site at http://www.fitchratings.com/ Bear Stearns Asset Backed Securities I LLC deposited the loans into the trust, which issued the certificates, representing beneficial ownership in the trust. JPMorgan Chase Bank, N.A. will act as Trustee. Wells Fargo Bank N.A., rated 'RMS1' by Fitch, will act as Master Servicer for this transaction. BENCHMARK ELECTRONICS: Earns $20.3MM of Net Income in 3rd Quarter ----------------------------------------------------------------- Benchmark Electronics, Inc., (NYSE: BHE) reported sales of $561 million for the quarter ended September 30, 2005, compared to $505 million for the same quarter last year. Third quarter net income was $20.3 million. In the comparable period last year, net income was $18.0 million. "Our third quarter results are a clear indication that our strategy is working as we delivered double digit growth in sales and net income," stated Benchmark's President and CEO Cary T. Fu. "Our continued focus and execution on meeting our customers' needs around the world have provided for strong growth, profitability and increased shareholder value." "I would like to thank our teams for their performance during the disruption caused by the Hurricane Rita evacuation that occurred during the last ten days of the third quarter. Our team's flexibility and dedication during this historical event in the Angleton/Houston area was nothing short of remarkable." Third Quarter 2005 Financial Highlights -- Operating margin for the third quarter was 4.4%. -- Cash flows provided by operating activities for the third quarter was $45 million. -- Return on invested capital of 12.7%. -- Cash and short-term investments balance at September 30, 2005 of $321 million. -- There is no debt outstanding. -- Accounts receivable decreased by $8 million during the quarter to $302 million; calculated days sales outstanding were 48 days. -- Inventories increased by $5 million during the quarter to $318 million; inventory turns were 6.6 times. Fourth Quarter 2005 Guidance Revenue in the fourth quarter of 2005 is expected to be between $585 million and $615 million. Earnings per share for the fourth quarter of 2005 are expected to be $0.49 to $0.54 per diluted share. Benchmark Electronics, Inc., manufactures electronics and provides its services to original equipment manufacturers of computers and related products for business enterprises, medical devices, industrial control equipment, testing and instrumentation products, and telecommunication equipment. Benchmark's global operations include facilities in eight countries. Benchmark's Common Shares trade on the New York Stock Exchange under the symbol BHE. * * * As reported in the Troubled Company Reporter on July 24, 2003, Standard & Poor's Ratings Services raised its corporate credit and senior secured debt ratings on Benchmark Electronics Inc. to 'BB-' from 'B+' and its subordinated debt rating to 'B' from 'B-'. The outlook is stable. BOYDS COLLECTION: Taps Houlihan Lokey as Financial Advisors ----------------------------------------------------------- The Boyds Collection, Ltd., and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Maryland for permission to employ Houlihan Lokey Howard & Zukin Capital, Inc., as its financial advisors and investment bankers. Houlihan Lokey will: 1) evaluate the Debtors strategic options and advise them in connection with available financing and capital restructuring alternatives, including recommendations of specific courses of action; 2) advise and assist the Debtors in connection with the development and implementation of key employee retention and other critical employee benefit programs; 3) assist the Debtors with the development, negotiation and implementation of a restructuring plan, including participation as an advisor to the Debtors in negotiations with creditors and other parties involved in restructuring; 4) advise the Debtors in potential mergers or acquisitions and the sale or disposition of any of their assets or businesses and assist with the design of any debt and equity securities or other consideration to be issued in connection with a restructuring transaction; 5) assist the Debtors in communications and negotiations with its constituents, including creditors, employees, vendors, shareholders and other parties-in-interest in connection with any restructuring transaction; and 6) render all other financial advisory and investment banking services to the Debtors that are necessary in their chapter 11 cases. Bradley Jordan, a Vice-President of Houlihan Lokey, disclosed that his Firm received a $250,000 retainer. Mr. Jordan reports that Houlihan Lokey will be paid with a $100,000 monthly fee and on consummation of a sale transaction that is part of a restructuring transaction, the Firm will be paid with a deferred fee equal to $1.5 million plus 3% of the equity value of that transaction. Mr. Jordan assures the Court that Houlihan Lokey does not represent any interest materially adverse to the Debtors or their estates. Headquartered in McSherrystown, Pennsylvania, The Boyds Collection, Ltd. -- http://www.boydsstuff.com/-- designs and manufactures unique, whimsical and "Folksy with Attitude(SM)" gifts and collectibles, known for their high quality and affordable pricing. The Company and its debtor-affiliates filed for chapter 11 protection on Oct. 16, 2005 (Bankr. Md. Lead Case No. 05-43793). Matthew A. Cantor, Esq., at Kirkland & Ellis LLP represents the Debtors in their restructuring efforts. As of June 30, 2005, Boyds reported $66.9 million in total assets and $101.7 million in total debts. BRICE ROAD: GE Credit Asks to Continue Foreclosure Action --------------------------------------------------------- General Electric Credit Equities, Inc., wants the U.S. Bankruptcy Court for the Southern District of Ohio, Western Division, to lift the automatic stay so it can proceed with the foreclosure action it had initiated against Brice Road Developments, LLC. GE Credit says the Debtor sought bankruptcy protection to stall the foreclosure process. GE Credit's Prepetition Claim Brice Road financed the construction of the Kensington Commons, a 264-unit apartment complex located in Columbus, Ohio, through a $14.4 million prepetition mortgage from Armstrong Mortgage Company. Armstrong held liens and security interests in substantially all of the Debtor's assets as security for the loan. GE Credit is a successor-in-interest to the Armstrong mortgage. In July 2005, GE Credit filed a complaint with the Franklin County, Ohio Court of Common Pleas, seeking a monetary judgment and foreclosure on the Kensington property. GE Credit says the Debtor hasn't made a mortgage payment since March 2004. According to GE Credit, the Debtor is in default on approximately $1.7 million of principal and interest payments due under the mortgage as of Sept. 23, 2005. The Debtor's debt to GE Credit at Sept. 23 total approximately $14.2 million. The full amount of the loan is due and payable because of the default. Grounds for Relief from the Stay Donald W. Mallory, Esq., at Dinsmore & Shohl LLP, tells the Bankruptcy Court that GE Credit should be allowed to foreclose on the Kensington property because the Debtor: a) filed its chapter 11 petition in bad faith; b) has not provided adequate protection for GE Credit's collateral; and c) no longer has any equity in the Kensington property so the property is not necessary for an effective reorganization. GE Credit points out that the Debtor does not have sufficient funds to prevent further diminution in the value of the Kensington Property. According to GE Credit, the fair market value of the Kensington Property currently stands at approximately $8 million to $11.8 million, resulting in a deficiency in the value of the collateral by as much as $6 million. Mr. Mallory explains that, because of the continued diminution in the value of the collateral, GE Credit will be the party most damaged if the automatic stay remains in full force and effect. By lifting the automatic stay, Mr. Mallory contends, GE Credit can resume the foreclosure action it had successfully launched against the Debtor. Mr. Mallory reminds the court that only the Debtor's bankruptcy filing in Sept. 2005 halted the foreclosure process. The Kensington property is currently in the hands of State Court-appointed receiver Reg Martin. The Debtor has requested Mr. Martin to turn over the rights to the property pursuant to Section 543 of the Bankruptcy Code. Headquartered in Dublin, Ohio, Brice Road Developments, L.L.C., owns Kensington Commons, a 264-unit apartment complex located outside of Columbus, Ohio. The Company filed for chapter 11 protection on Sept. 2, 2005 (Bankr. S.D. Ohio Case No. 05-66007). Yvette A Cox, Esq., at Bailey Cavalieri LLC represents the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it estimated assets and debts of $10 million to $50 million. BURLINGTON INDUSTRIES: Trust Wants Court to Close Chapter 11 Cases ------------------------------------------------------------------ The BII Distribution Trust, successor-in-interest to Burlington Industries, Inc., and its debtor-affiliates, asks U.S. Bankruptcy Court for the District of Delaware to enter a final decree: -- closing the Chapter 11 cases of Burlington Industries, Inc., and Burlington Mills, Inc., except for certain remaining matters; and -- authorizing it to destroy, or otherwise dispose of, relevant documents. The Trust believes that it is necessary to leave the BII case open for the limited purpose of allowing the Court to hear and decide on matters relating to: (a) eight disputed and unresolved claims; (b) eight pending adversary proceedings in the Debtors' Chapter 11 cases; (c) the disposition of the remaining assets of the Estates; and (d) the final distribution to holders of allowed claims and the dissolution of the Trust. Once the remaining estate matters are resolved, the Trust will be in a position to make a final distribution to Holders of Allowed Claims, file final tax returns and dissolve itself in accordance with the Chapter 11 Plan. Daniel J. DeFranceschi, Esq., at Richards, Layton and Finger, in Wilmington, Delaware, relates that in addition to the Remaining Estate Assets, the Trust is in possession of certain documents pertaining to these bankruptcy cases, including books and records of the Trust. Upon the resolution of the Remaining Estate Matters, the Trust deems it appropriate to destroy, or otherwise dispose of, the Documents on or after the date that is 120 days following the date of the Final Distribution. Mr. DeFranceschi assures the Court that the deposits and property transfers provided for by the Plan have been completed. In addition, most distributions provided for under the Plan have been made. Except for the Remaining Estate Matters, all of the motions and contested claims in the Debtors' cases either have been, or, by the scheduled hearing, will be finally resolved. The Trust contends that if the BII Case does not remain open for the Remaining Estate Matters, it will be necessary to file a request to reopen the Case for the Court to hear and decide on the unresolved issues. Therefore, leaving the BII Case open for this limited purpose is the most efficient way to comply with the Court's directive to close the cases and to meet the Trust's fiduciary obligations to its beneficiaries. Headquartered in Greensboro, North Carolina, Burlington Industries, Inc. -- http://www.burlington-ind.com/-- was one of the world's largest and most diversified manufacturers of soft goods for apparel and interior furnishings. The Company filed for chapter 11 protection in November 15, 2001 (Bankr. Del. Case No. 01-11282). Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger, and David G. Heiman, Esq., at Jones Day, represent the Debtors. WL Ross & Co. LLC purchased Burlington Industries and then sold the Lees Carpets business to Mohawk Industries, Inc. Combining Burlington with Cone Mills, WL Ross created International Textile Group. Burlington's chapter 11 Plan confirmed on October 30, 2003, was declared effective on Nov. 10, 2003. (Burlington Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service, Inc., 215/945-7000) CALPINE CORP: CCFC Raises $300 Million in Preferred Stock Sale -------------------------------------------------------------- Calpine Corporation's indirect subsidiary, CCFC Preferred Holdings, LLC, issued 300,000 Redeemable Preferred Shares, each with a paid-up value of $1,000, on October 14, 2005. CCFC Preferred is an indirect parent of Calpine Construction Finance Company, L.P. As reported in the Troubled Company Reporter on Oct. 11, 2005, net proceeds from the offering of the Redeemable Preferred Shares will be used as permitted by Calpine's existing bond indentures. The Preferred Shares were sold to accredited investors and qualified institutional buyers in a private placement in the United States under Section 4(2) and Regulation D under the Securities Act of 1933. Morgan Stanley & Co. Incorporated acted as placement agent for the offering. Net proceeds from the sale of the Preferred Shares were distributed to Calpine for use in accordance with Calpine's existing bond indentures. The Preferred Shares initially accrue dividends at a rate per annum equal to the six-month U.S. Dollar LIBOR plus a margin of 950 basis points except that upon the occurrence and during the continuance of certain voting rights triggering events, the rate per annum for dividends will increase by 200 basis points above the then-applicable margin. Dividends will be payable in cash semi-annually in arrears each February 26 and August 26, beginning on February 26, 2006. Voting rights triggering events include, among other things: (1) the failure of CCFC Preferred to declare and pay dividends when due or to satisfy any mandatory redemption or repurchase requirements; (2) the occurrence of a default under CCFC Preferred's term loan agreement or the indenture governing CCFC Preferred's second priority floating rate notes; (3) the breach of certain other covenants or undertakings with respect to the Preferred Shares; and (4) certain bankruptcy-related events in relation to the Issuer and its subsidiaries. In addition, upon the occurrence of a voting rights trigger event, the holders of the Preferred Shares will have the right to elect CCFC Preferred's board of directors. CCFC Preferred may redeem any of the Preferred Shares beginning on October 15, 2008, at an initial redemption price of 100% of paid-up value plus a premium equal to 5%. CCFC Preferred will be required to redeem all of the then outstanding Preferred Shares on October 14, 2011, at their paid-up value, together with accrued and unpaid dividends. Additionally, CCFC Preferred will be required to redeem or repurchase Preferred Shares: -- upon the occurrence of certain change of control events with respect to CCFC Preferred or its direct and indirect parents or subsidiaries; and -- with the proceeds of certain assets sales, debt issuances, and equity issuances, in each case: (a) by CCFC Preferred or its direct and indirect subsidiaries; and (b) to the extent permitted by, and after compliance with all applicable requirements of, the CCFC Financing Documents. The terms of the Preferred Shares require CCFC Preferred and its subsidiaries to comply with all of its obligations under the CCFC Financing Documents, as well as certain additional covenants. Calpine Corporation -- http://www.calpine.com/-- supplies customers and communities with electricity from clean, efficient, natural gas-fired and geothermal power plants. Calpine owns, leases and operates integrated systems of plants in 21 U.S. states, three Canadian provinces and the United Kingdom. Its customized products and services include wholesale and retail electricity, natural gas, gas turbine components and services, energy management, and a wide range of power plant engineering, construction and operations services. Calpine was founded in 1984. It is included in the S&P 500 Index and is publicly traded on the New York Stock Exchange under the symbol CPN. * * * As reported in the Troubled Company Reporter on June 23, 2005, Standard & Poor's Ratings Services assigned its 'CCC' rating to Calpine Corp.'s (B-/Negative/--) planned $650 million contingent convertible notes due 2015. The proceeds from that convertible debt issue will be used to redeem in full its High Tides III preferred securities. The company will use the remaining net proceeds to repurchase a portion of the outstanding principal amount of its 8.5% senior unsecured notes due 2011. S&P said its rating outlook is negative on Calpine's $18 billion of total debt outstanding. As reported in the Troubled Company Reporter on May 16, 2005, Moody's Investors Service downgraded the debt ratings of Calpine Corporation (Calpine: Senior Implied to B3 from B2) and its subsidiaries, including Calpine Generating Company (CalGen: first priority credit facilities to B2 from B1). CELESTICA INC: Incurs $19.6 Million Net Loss in Third Quarter ------------------------------------------------------------- Celestica Inc. (NYSE: CLS, TSX: CLS/SV) reported its financial results for the third quarter ended September 30, 2005. Revenue was $1.994 billion, compared to $2.176 billion in the third quarter of 2004. Net loss on a GAAP basis for the third quarter was ($19.6) million, compared to a GAAP net loss for the third quarter of 2004 of ($24.4) million. Included in GAAP net loss for the quarter are charges of $40.9 million associated with previously announced restructuring plans, and a $6.8 million charge associated with the company's previously announced option exchange program approved by shareholders in April of this year. Adjusted net earnings for the quarter were $27.1 million compared to $25.3 million for the same period last year. Adjusted net earnings is defined as net earnings before amortization of intangible assets, gains or losses on the repurchase of shares and debt, integration costs related to acquisitions, option expense and option exchange costs, other charges net of tax These results compare with the company's guidance for the third quarter, announced on July 21, 2005, of revenue of $1.9 billion to $2.2 billion. For the nine months ended September 30, 2005, revenue decreased two percent to $6,396 million compared to $6,507 million for the same period in 2004. Net loss on a GAAP basis was ($18.6) million compared to a net loss of ($44.4) million last year. Adjusted net earnings for the first nine months were $100.2 million or $0.44 per share compared to adjusted net earnings of $52.6 million or $0.24 per share in 2004. "This quarter's results reflect the continued weakness we had previously highlighted from our largest communications and information technology end markets," said Steve Delaney, CEO, Celestica. "Though our outlook for the December quarter is more moderate than what we would typically expect, I am very pleased with our new program wins, the customers we have added and the opportunities ahead of us. We expect these wins to improve our end-market diversification and to translate into revenue growth in 2006. As these new programs ramp, we will focus on completing our restructuring activities and aggressively managing our costs to ensure margins are maintained and improved in the coming quarters. We will also remain highly focused on our global Lean implementation, which we believe can translate into the most competitive and robust supply chains for our customers." Outlook For the fourth quarter ending December 31, 2005, the company anticipates revenue to be in the range of $1.9 billion to $2.1 billion. Celestica, Inc. -- http://www.celestica.com/-- is a world leader in the delivery of innovative electronics manufacturing services. Celestica operates a highly sophisticated global manufacturing network with operations in Asia, Europe and the Americas, providing a broad range of integrated services and solutions to leading OEMs (original equipment manufacturers). Celestica's expertise in quality, technology and supply chain management, enables the company to provide competitive advantage to its customers by improving time-to-market, scalability and manufacturing efficiency. * * * Celestica's 7-5/8% senior subordinated notes due 2013 and 7-7/8% senior subordinated notes due 2011 carry Moody's Investors Service's and Standard & Poor's single-B ratings. CHARTER COMMS: CCO Holdings LLC Inks $600 Million Sr. Loan Pact --------------------------------------------------------------- Charter Communications Holdings, LLC, and Charter Communications Holdings Capital Corporation's indirect subsidiaries: * CCO Holdings, LLC, and * CCO Holdings Capital Corp., entered into a new senior bridge loan agreement, on Oct. 17, 2005, with: -- JPMorgan Chase Bank, N.A., -- Credit Suisse, Cayman Islands Branch, and -- Deutsche Bank AG Cayman Islands Branch The lenders committed to lend up to $600 million to CCO Holdings, LLC. The period during which CCO Holdings, LLC, may draw upon the facility will begin on January 2, 2006, and will end on September 29, 2006. The CCO Holdings, CCO Holdings Capital guarantees LLC's obligations under the Agreement. Beginning on the first anniversary of the first date that CCO Holdings, LLC, borrows under the Agreement and at any time thereafter, any lender will have the option to receive "exchange notes" in exchange for any loan that has not been repaid by that date. Each loan will accrue interest at a rate equal to an adjusted LIBOR rate plus a spread. The spread will initially be 450 basis points and will increase: (a) by an additional 25 basis points at the end of the six-month period following the date of the first borrowing, (b) by an additional 25 basis points at the end of each of the next two subsequent three month periods; and (c) by 62.5 basis points at the end of each of the next two subsequent three-month periods. As conditions to each draw: (a) there will be no default under the Agreement; (b) all the representations and warranties under the Agreement will be true and correct in all material respects; and (c) all conditions to borrowing under the April 27, 2004 Amended and Restated Credit Agreement of Charter Communications Operating, LLC (with certain exceptions) will be satisfied. On the earlier of: (a) the date that at least a majority of all loans that have been outstanding have been exchanged for Exchange Notes; and (b) the date that is 18 months after the first date that the CCO Holdings, LLC, borrows under the Agreement, the remainder of loans will be automatically exchanged for Exchange Notes. The Exchange Notes will mature on the sixth anniversary of the first borrowing under the Agreement. The Exchange Notes will bear interest at a rate equal to the rate that would have been borne by the loans. The indenture governing the Exchange Notes will be based upon the Borrower's senior notes indenture but with certain modifications based upon more recent indentures of certain of Charter's other subsidiaries. Charter Communications, Inc. -- http://www.charter.com/-- a broadband communications company, provides a full range of advanced broadband services to the home, including cable television on an advanced digital video programming platform via Charter Digital(TM), Charter High-Speed(TM) Internet service and Charter Telephone(TM). Charter Business(TM) provides scalable, tailored and cost-effective broadband communications solutions to organizations of all sizes through business-to-business Internet, data networking, video and music services. Advertising sales and production services are sold under the Charter Media(R) brand. At June 30, 2005, Charter Communications' balance sheet showed a $5.1 billion stockholders' deficit, compared to a $4.4 billion deficit at Dec. 31, 2004. COMMERCIAL MORTGAGE: S&P's Rating on Class J Certs. Tumbles to D ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on class J of Commercial Mortgage Lease-Backed Securities LLC's commercial mortgage lease-backed certificates series 2001-CMLB-1 to 'D' from 'CCC+'. The downgrade reflects a principal loss to the class due to the transaction's exposure to Winn-Dixie Inc. and the September 2005 sale of the transaction's exposure to Winn-Dixie Pass-Through Trust Certificates Series 1999-1. The sale was made by the special servicer, Wachovia Bank N.A. Per the remittance report dated Oct. 21, 2005, the trust experienced a $5.7 million loss upon the sale of the $22.4 million exposure to class A-2 of Winn-Dixie 1999-1. The default of class J from CMLB 2001-CMLB-1 follows Winn Dixie Inc.'s bankruptcy filing, which occurred earlier this year. The loss reduced the principal balance of class J to $6.2 million from $7.1 million. The only remaining exposure to Winn-Dixie Inc. in CMLB 2001-CMLB-1 consists of a credit-tenant lease loan totaling $3.2 million, which is secured by a store in Dothan, Alabama that is not currently scheduled for closure. To date, the aforementioned $5.7 million loss is the only loss the trust has experienced. Because the transaction is a CTL pool, the assigned ratings are correlated with the ratings assigned to the underlying tenants/guarantors. As such, the ratings on the certificates may fluctuate over time as the ratings of the underlying tenants/guarantors change. CONSOLIDATED CONTAINER: J.M. Greene Replaces S.E. Macadam as CEO ---------------------------------------------------------------- Consolidated Container Company reported the appointment of Jeffrey M. Greene as president and chief executive officer, effective immediately. Mr. Greene, age 46, succeeds Stephen E. Macadam, who resigned effective October 18, 2005. Mr. Greene brings nearly a quarter century industry experience to his post, including the past two years as senior vice president of CCC's Consumer Packaging Group, which he led through a national expansion. He joined the company in January 2002 as vice president of Continental Plastic Containers, a division of CCC, and played a critical role in its evolution. His background includes sales and operating positions at such well-known companies as Champion International, Union Camp and International Paper. Immediately prior to joining CCC, he was senior vice president of operations at Exopack. "Jeff is a proven and highly respected industry leader, and we're delighted that he will be guiding CCC as we look to further strengthen our already strong market position of producing over 5 billion containers each year for many of the largest branded consumer products and beverage companies in the world," said Jim Kelley, chairman of the Management committee and president of Vestar Capital Partners, the controlling shareholder of CCC. "Jeff has been a key member of our senior leadership team for almost four years, and we have been impressed with his talent, energy and vision." Mr. Kelley added, "We are also very grateful to Steve, who made vast improvements to CCC since joining as CEO in 2001. He has been a strong leader and we wish him well. Steve will continue as a member of the Board and an investor in CCC." "I have the privilege of working with very capable colleagues in the senior management at CCC who have contributed significantly to the progress we've made in recent years. I am grateful for their support as I assume these new responsibilities," Mr. Greene said. "Together with all 3,500 outstanding colleagues in 57 manufacturing sites, we will continue working to expand our already solid operating base and driving sales growth by getting even closer to our customers. A primary objective is to enhance the partnership with our customers to create maximum value for them." Consolidated Container Company LLC, which was created in 1999, develops, manufactures and markets rigid plastic containers for many of the largest branded consumer products and beverage companies in the world. CCC has long-term customer relationships with many blue-chip companies including Dean Foods, DS Waters of America, The Kroger Company, Nestle Waters North America, National Dairy Holdings, The Procter & Gamble Company, Coca-Cola North America, Quaker Oats, Scotts and Colgate-Palmolive. CCC serves its customers with a wide range of manufacturing capabilities and services through a nationwide network of 61 strategically located manufacturing facilities and a research, development and engineering center located in Atlanta, Georgia. Additionally, the company has 4 international manufacturing facilities in Canada, Mexico and Puerto Rico. * * * As reported in the Troubled Company Reporter on Aug. 19, 2005, Standard & Poor's Ratings Services revised its outlook on Consolidated Container Co. LLC to stable from positive and affirmed its 'B-' corporate credit rating and other ratings on the company. DANA CORP: S&P Chips Sr. Unsecured Credit Rating to BB from BB+ --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit and senior unsecured debt ratings on Dana Corp. to 'BB' from 'BB+', and kept the ratings on CreditWatch with negative implications. Total outstanding debt at June 30, 2005, was about $2.2 billion, accounting for finance subsidiary Dana Credit Corp. by the equity method. DCC is undergoing an orderly liquidation. "The downgrade and continuing CreditWatch review reflect the anticipated continued near-term deterioration of Toledo, Ohio-based Dana's credit profile, due to more difficult light-vehicle industry conditions, and the operational inefficiencies within Dana's automotive systems and commercial vehicle groups, which will take time to fix," said Standard & Poor's credit analyst Daniel R. DiSenso. Dana has announced plans to divest noncore businesses with annual sales of about $1.3 billion, representing about 14% of the firm's 2004 sales. The company will also close two facilities in its automotive systems group and take a number of steps to balance capacity and enhance manufacturing efficiencies at commercial vehicle operations. Later this year, Dana will take $324 million of pretax charges, and it will take an estimated $21 million of pretax charges in 2006 and 2007. Total cash outlays from these restructuring actions are expected to be $27 million, and Dana expects to achieve more than $20 million of annual savings once the program is completed. In addition, Dana expects to achieve more than $40 million of annual savings from a 5% salaried workforce reduction and changes to its employee benefit programs. The accelerated decline in demand for SUVs and market share losses by two important Dana customers, General Motors Corp. and Ford Motor Co. will potentially reduce the benefits from Dana's restructuring actions. Moreover, very strong demand in North America for commercial vehicles is expected to weaken materially in 2007, when stricter and more costly new emissions standards go into effect. Dana's commercial vehicles business has not fully benefited from peak demand -- EBIT margin for the first half of 2005 for this business was only 7.2% -- and restructuring benefits could be partially offset by a much weaker market. Before coming to a ratings decision, Standard & Poor's will review the details of the restructuring plan with Dana management and look at the near-term market outlook for light and commercial vehicles. S&P will also review the details of Dana's financing plans and accounting issues and controls. Dana may be required to restate its financial statements for 2004 and for the first and second quarters of 2005. At this time, the company estimates that the cumulative effect of potential restatements would reduce net income by $25 million to $45 million. DAVID DEEGAN: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: David J. Deegan 98 Hoyt Street, Apartment 1J Stamford, Connecticut 06905 Bankruptcy Case No.: 05-52022 Chapter 11 Petition Date: October 16, 2005 Court: District of Connecticut (Bridgeport) Judge: Alan H.W. Shiff Debtor's Counsel: Matthew K. Beatman, Esq. Zeisler & Zeisler, P.C. 558 Clinton Avenue P.O. Box 3186 Bridgeport, Connecticut 06605 Tel: (203) 368-4234 Total Assets: $228,874 Total Debts: $1,002,266 Debtor's 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ MBNA America $40,982 P.O. Box 17054 Wilmington, DE 19884 Citibank NA $40,333 P.O. Box 769006 San Antonio, TX 78245 MBNA America $29,986 P.O. Box 17054 Wilmington, DE 19884 Capital One $29,966 Credigy $21,471 Bank One $19,700 Portfolio Recovery Assoc $18,099 Citibank $15,248 American Express $14,927 LVNV Funding LLC $14,715 Citibank NA $13,886 American Express $13,315 LVNV Funding LLC $11,834 United Mortgage $11,746 First USA Bank $11,136 Discover Financial Services $10,662 MBNA America $10,344 American Express $10,137 Fleet Credit Card Services $9,176 Portfolio Recovery Assoc $653 DE KALB HOUSING: S&P Downgrades $1.3 Mil Bond Rating to D from C ---------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its rating on De Kalb County Housing Authority, Georgia's $12.6 million multifamily mortgage bonds series 1996A, issued on behalf of the Regency Woods I and II projects. At the same time, Standard & Poor's lowered its rating on the authority's $1.3 million series 1996C bonds to 'D' from 'C'. In a notice dated Sept. 27, 2005, the trustee informed bondholders that the Regency Woods I property was sold on Aug. 29, 2005, and the Regency Woods II property was sold on Sept. 5, 2005. Proceeds of the sale will be distributed to the bondholders. Series A bondholders will be paid off in full, including accrued interest through Oct. 17, 2005. Series C bondholders are not expected to be paid in full, thus the rating on these bonds is now 'D' to reflect the loss. According to the trustee, series C bondholders will be paid off at a later date to be announced. The bonds financed Regency Woods I and II, two affordable multifamilty projects with 330 units located in northern Atlanta. DELPHI CORP: Gets Interim Injunction Against Utility Companies -------------------------------------------------------------- As reported in the Troubled Company Reporter on Oct. 17, 2005, John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, in Chicago, Illinois, asserted that uninterrupted utility services are essential to the Debtors' ongoing operations and therefore, to the success of the Debtors' reorganization. If the Utility Companies refuse or discontinue service, even for a brief period, the Debtors' business operations would be severely disrupted, Mr. Butler pointed out. Pursuant to Section 366 of the Bankruptcy Code, a utility may not alter, refuse, or discontinue service to, or discriminate against, a debtor solely on the basis of a bankruptcy filing or the non-payment of a prepetition debt. That utility may alter, refuse, or discontinue service within 20 days after the Petition Date, if the debtor does not furnish adequate assurance of payment for postpetition services. Mr. Butler told the U.S. Bankruptcy Court for the Southern District of New York that the Debtors' history of consistent and regular payment to the Utility Companies, coupled with their demonstrated ability to pay future utility bills from ongoing operations and postpetition financing, constitute adequate assurance of payment for future utility services. The fact that the Debtors have sufficient assets to pay their postpetition costs of administration on a timely basis, and will continue to pay their utility bills as they become due, provide adequate assurance of future payment without the need to provide additional security deposits, bonds, or any other payments to the Utility Companies, Mr. Butler added. The Debtors propose that any Utility Company seeking adequate assurance from them in the form of a deposit or other security be required to make that Request in writing, setting forth the location for which utility services were provided. Any Request for adequate assurance must set forth: -- a payment history for the most recent six months; -- a list of any deposits or other security currently held by the Utility Company making the Request on account of the Debtors; and -- a description of any prior material payment delinquency or irregularity. On an interim basis, The Honorable Robert D. Drain of the Southern District of New York Bankruptcy Court: (a) prohibits utilities from altering, refusing, or discontinuing services on account of prepetition invoices; and (b) approves the proposed procedures for determining requests for additional adequate assurance. Headquartered in Troy, Michigan, Delphi Corporation -- http://www.delphi.com/-- is the single largest global supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The Company's technology and products are present in more than 75 million vehicles on the road worldwide. The Company filed for chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represents the Debtors in their restructuring efforts. As of Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530 in total assets and $22,166,280,476 in total debts. (Delphi Bankruptcy News, Issue No. 4; Bankruptcy Creditors' Service, Inc., 215/945-7000) DELTA AIR: Comair to Cut 1,000 Jobs & Reduce Fleet by 30 Aircraft ----------------------------------------------------------------- Delta Air Lines' regional airline subsidiary Comair reported plans to reduce costs by up to $70 million annually as the company makes changes to its business in support of Delta's ongoing transformation. The plan combines savings to be achieved through the Chapter 11 process with changes to Comair's fleet, network and employment costs to align the company's cost structure with the reduced revenues that will be realized in a restructured environment. "Delta's efforts to achieve an additional $3 billion in annual financial benefits by 2007 include amending Comair's Delta Connection agreement to reduce the amount of compensation provided for regional airline feed," said Fred Buttrell, Comair president. "As a result, Comair must adjust its costs to match the cost pressures of a restructured airline industry and to create a commercial solution that will ensure Comair emerges from the restructuring process ready to compete and thrive for the long term." Reducing Fleet Ownership and Supplier Costs Comair will use benefits available through the Chapter 11 process to eliminate non-competitive aircraft leases and mortgages to reduce ownership costs and allow the airline to have a more competitive platform. As part of this, Delta plans to remove up to 30 aircraft from Comair's schedule, with 11 aircraft leaving the schedule by December. The initial reductions are associated with Delta's recently announced right-sizing of the Cincinnati hub and predominantly affect 50-seat aircraft, although long-term cost reduction initiatives are targeted for 40- and 70-seat aircraft. Even with these changes, all destinations in the Delta network will continue to be served by Delta or the Delta Connection carriers with the December schedule. In addition to fleet costs, Comair also will continue to improve supply chain practices and streamline other processes to lower what it pays for goods and services. This includes seeking more favorable terms for equipment, supplies, facilities and non- employee overhead costs. Adjusting Employment Costs to be Competitive in the Regional Industry As a result of a smaller operation and fleet, Comair will reduce up to 1,000 positions throughout the company, including the reduction of approximately 350 positions recently announced as part of the right-sizing of service to and from Cincinnati. At the same time, Comair will adjust compensation and benefits to be more competitive with other regional airlines. Specifically, Comair plans to implement across-the-board pay reductions for officers and directors in the first pay period of November and for non-union employees during the first pay period in December. These reductions, which are designed to achieve at least $5.2 million in annual savings, include: -- President - 15% reduction (for 25% total in 2005) -- Officers - 10% reduction (for 20% total in 2005 on top of a pay freeze over the last five years) -- Directors - 9%, (in addition to a pay freeze over the last five years) -- Supervisory/Administrative - 7% for salaried; 4% for hourly (in addition to the pay freeze in two of the last three years) -- Customer Service agents - 4% and a revised pay scale structure Comair is also scheduled to begin discussions with union representatives to reduce employment costs by: (a) $17.3 million for pilots; (b) $8.9 million for flight attendants; and (c) $1 million for mechanics. As part of working agreement amendments signed earlier this year, pilots are under a pay freeze that was effective in June, and a new-hire scale is in effect for flight attendants. "We are extremely sensitive to the impact these changes have on our employees, but this is a Comair solution to a very tough problem that threatens the future of our company," Mr. Buttrell said. "We are looking at ways to minimize this impact on our people and to help ease this transition. Our goal is to handle as much of the transition as possible through voluntary means. "These changes, while difficult, are necessary in the current industry environment and are required if we are to emerge from our restructuring ready to compete and win," he continued. As a result of its restructuring, Comair plans to emerge from the Chapter 11 process positioned to compete for more 70-seat flying and to reduce its dependence on flying in the 50-seat market. "We believe that 70-seat flying and, potentially, larger gauge equipment will be in higher demand as the industry continues to restructure," Mr. Buttrell said. "During and after restructuring, Comair's ability to succeed will center on our ability to deliver customer service excellence and to build a cost-competitive platform that makes Comair competitive on all fleet types." Based at Cincinnati/Northern Kentucky International Airport, Comair has been a Delta Connection carrier since 1984. The airline operates 1,155 flights a day to 110 destinations in the United States, Canada and the Bahamas. Headquartered in Atlanta, Georgia, Delta Air Lines -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 502 destinations in 88 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. The Company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. As of June 30, 2005, the Company's balance sheet showed $21.5 billion in assets and $28.5 billion in liabilities. (Delta Air Lines Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., 215/945-7000) DELTA AIR: Wants to Pay Chicago $1,092,630 on Oct. 31 for Bonds --------------------------------------------------------------- In August 1992, the City of Chicago issued $33,880,000 in principal amount of bonds to refinance an earlier series of bonds issued by the City in 1982. The earlier bonds had been issued to finance a portion of the costs of expanding a passenger terminal building and constructing other facilities used by Delta Air Lines, Inc., at O'Hare International Airport. The financing was governed by an Indenture entered into between the City and Continental Illinois National Bank and Trust Company of Chicago, as trustee, dated November 15, 1982, and supplemented by, inter alia, the Second Supplemental Indenture dated August 1, 1992. Sharon Katz, Esq., at Davis Polk & Wardwell, in New York, relates that Delta is a party to two separate agreements governing: (i) the financing of the expansion and improvement of Delta's O'Hare facilities and (ii) the actual use and occupancy of those facilities. Delta and the City are parties to a Special Facility Use Agreement dated as of August 1, 1982, pursuant to which Delta makes payments on the 1992 Bonds. To pay the debt service on the Bonds, the Original Special Facility Use Agreement, as supplemented in 1992, requires Delta to make semi-annual Debt Service Payments to the Trustee. The Special Facility Use Agreement also requires Delta to pay certain fees and expenses of the U.S. Bank National Association, successor-in-interest to Continental Illinois National Bank and the current Trustee. Under the Indenture, the City assigned its right to the Debt Service Payments to the Trustee. Separate from its obligation to make payments on the Bonds, Delta enjoys the right to use and occupy its O'Hare facilities under a separate agreement -- the Amended and Restated Airport Use Agreement and Terminal Facilities Lease dated as of January 1, 1985. Under this agreement, Delta is required to make monthly rental payments to the City for use and occupancy of its O'Hare facilities. The next Debt Service Payment -- $1,092,630 -- is due on Oct. 31, 2005. Delta has commenced and wishes to continue settlement discussions among the Parties regarding a restructuring of the Agreements. Those discussions contemplate that the restructuring would provide Delta with a substantial amount of much-needed liquidity in the form of an up-front cash payment, in exchange for Delta's relinquishment of certain exclusive use rights to its O'Hare facilities. Ms. Katz maintains that the liquidity generated from the restructuring would substantially exceed the approximately $1,000,000 in debt service Delta would pay in the interim. It may also enable the parties to avoid a costly litigation regarding the proper characterization of the debt service payments. Ms. Katz explains that a litigated dispute would likely center on the Cross-Default Provisions and the proper characterization of the Special Facilities Use Agreement. Delta would argue that the Cross-Default Provisions are unenforceable in bankruptcy and that it can assume the Airport Use Agreement and continue to occupy its O'Hare facilities without making the Debt Service Payments. In addition, Delta would argue that the Special Facilities Use Agreement is a financing arrangement and that Delta therefore would not be required to make the Payments during the pendency of its bankruptcy. If Delta does not make the October 31 Payment, it risks a party taking the position that Delta: (a) has not complied with Section 365(d)(3) of the Bankruptcy Code, and (b) is in default under the Agreements, including by way of the Cross-Default Provisions. On the other hand, if Delta does make the payment, it risks a party taking the position that its payment waives or prejudices any argument, in connection with the Bonds or in connection with another bond issue, that the payment constitutes a prepetition financing obligation. Moreover, if a dispute arises and Delta were ultimately to prevail on a claim that the interest payment constitutes a prepetition financing obligation, Delta would have made the payment without the court approval required by Section 363(b)(1). To negotiate a resolution of certain issues between or among the Parties, Delta seeks to maintain the status quo by entry of an order authorizing it to make the October 31 Payment; provided, that the payment does not waive or prejudice the positions of any of the Parties, including any argument regarding: (i) the enforceability of the Cross-Default Provisions; and (ii) the question whether the Debt Service Payments are true lease obligations or prepetition financing obligations. To facilitate the participation of U.S. Bank in the settlement discussions, Delta also seeks the U.S. Bankruptcy Court for the Southern District of New York's permission to pay the reasonable fees and expenses, including attorney's fees, of the Trustee incurred on or before May 1, 2006, in connection with the settlement discussions. Headquartered in Atlanta, Georgia, Delta Air Lines -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 502 destinations in 88 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. The Company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. As of June 30, 2005, the Company's balance sheet showed $21.5 billion in assets and $28.5 billion in liabilities. (Delta Air Lines Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., 215/945-7000) DELTA AIR: Wants to Enter Into Section 1110(a) Stipulations ----------------------------------------------------------- Delta Air Lines Inc. and its debtor-affiliates' fleet consists of over 700 aircraft and a vast amount of related equipment. Some of the aircraft are owned by the Debtors and are encumbered by various financing transactions. The remaining aircraft and related equipment are leased or financed pursuant to a wide variety of leasing and financing agreements including operating leases and leveraged leases. Approximately 208 of the Delta aircraft and 20 of the Comair aircraft were financed in transactions involving the issuance of public aircraft securities, including pass-through certificates, equipment trust certificates, and enhanced equipment trust certificates. The Debtors believe that the market values of many of the aircraft have declined substantially since the aircraft were originally leased or financed. Richard F. Hahn, Esq., at Debevoise & Plimpton LLP, in New York, notes that, although the Debtors were able to negotiate cost savings for a portion of their fleet as part of their out-of- court restructuring in 2004, the cost-savings have proven to be insufficient given other factors, including rising fuel costs. As part of their Chapter 11 cases, the Debtors plan to seek additional cost-savings with respect to an even larger portion of their fleet. Since the Petition Date, the Debtors have distributed approximately 185 proposals to a number of Aircraft Parties seeking reduced payment terms with respect to certain aircraft. The Aircraft Equipment may constitute as "equipment" covered under Section 1110 of the Bankruptcy Code. The automatic stay under Section 362 of the Bankruptcy Code vaporizes on the 60th day after the Petition Date, unless a debtor commits to full contractual performance and cures on any defaults pursuant to a Section 1110(a) Election. Pursuant to Section 1110(b), a debtor cannot unilaterally extend the 60-day period. By this motion, the Debtors ask the U.S. Bankruptcy Court for the Southern District of New York for permission to make elections pursuant to Section 1110(a) and perform obligations under certain leases and secured financings relating to the Aircraft Equipment. The Debtors also want to make payments and take other actions as are necessary to cure defaults and retain protection of the automatic stay with respect to the Aircraft Equipment in compliance with Section 1110 and the 1110(a) Election. In addition, the Debtors seek to enter into stipulations pursuant to Section 1110(b) with aircraft lessors and financiers extending the time to perform the Section 1110 obligations. 1110(a) Elections If the Debtors decide to make a Section 1110(a) Election for a particular Aircraft Agreement, they will: -- file and serve notice of the Section 1110(a) Election; -- perform all obligations that become due under the relevant Aircraft Agreement; and -- cure any default under the Aircraft Agreement (other than a default of a kind specified in Section 365(b)(2) of the Bankruptcy Code, as to which no cure is required): (i) in the case of any default that occurred before the Petition Date, on or before November 14, 2005; and (ii) in the case of any default that occurred after the Petition Date and before the expiration of the 60- day period provided under Section 1110, on or before the later of 30 days after the date of the default or November 14. Objections must be filed and served on or before 4:00 p.m. prevailing Eastern Time on the date that is 10 days from the date of the filing of the applicable 1110 Election Notice. The Objection must set forth with specificity: (1) the party's interest in the affected Aircraft Equipment, if any; (2) the basis for the Objection; (3) the provisions of the Aircraft Agreement or any other agreement under which the objecting party contends any uncured default exists, if any, and (4) the amount, if any, that the objecting party asserts as the Cure Amount, if different from that specified by the Debtors. Unless the Court orders otherwise with respect to a specific 1110 Election Notice, upon filing of the Notice before November 14, 2005, and the timely payment of the Cure Amounts: (a) all defaults under the applicable Aircraft Agreement (other than defaults of a kind specified in section 365(b)(2) as to which no cure is required) will be deemed cured, (b) the Notice will be deemed effective as of November 14, 2005, and (c) the 60-day period set forth in Section 1110(a)(2) will be deemed to have been extended with respect to the Aircraft Equipment identified in the Notice. If an 1110(a) Objection has been timely filed and the dispute related to the Aircraft Equipment is not resolved consensually within 10 days from the Objection, the Debtors will schedule a hearing to consider the Objection only with respect to the particular Aircraft Equipment. Neither the Debtors' 1110 Agreement nor the 1110 Election Notice will be deemed to constitute an assumption of any Aircraft Agreement under Section 365. The Debtors ask the Court to waive the requirement of Local Rule 6006-1(d) to the extent that the rule would otherwise require the scheduling of hearings with respect to all 1110 Agreements. According to Mr. Hahn, in view of the unprecedented number of aircraft with respect to which action must be taken in the brief 60-day period, the requirement would be burdensome on both the Debtors and the Court, and would not fulfill any useful purpose. 1110(b) Stipulations The Debtors have concluded that it is in the best interest of their estates to attempt to reach agreements with certain Aircraft Parties on the terms of new or modified Aircraft Agreements that are more closely aligned with current market conditions. Given the number of Aircraft Agreements that the Debtors may seek to renegotiate, the number of Aircraft Parties that may be involved in these negotiations, and the difficulty in identifying many of these Aircraft Parties, the Debtors are unlikely to complete this task in the 60-day period provided under Section 1110. Each 1110(b) Stipulation will provide for an extension of the deadline established by Section 1110. In certain cases, the Stipulation may modify, either on an interim or permanent basis, certain terms of the relevant Aircraft Agreement. Each 1110(b) Stipulation will clarify that it does not constitute an election or an agreement by the Debtors to perform all of their obligations under the relevant Aircraft Agreement pursuant to Section 1110(a) of the Bankruptcy Code or any other provision of the Bankruptcy Code. Each 1110(b) Stipulation will further clarify that it does not constitute an assumption of the relevant Aircraft Agreement under Section 365 and in no way restricts the Debtors' ability to later restructure the Aircraft Agreement or reject or abandon the Aircraft Equipment relating to that Aircraft Agreement. The 1110(b) Stipulations may vary in form to reflect the unique characteristics (e.g., age, model type and maintenance history) of the relevant Aircraft Equipment or the differing requirements of the relevant Aircraft Parties. The Debtors will communicate these variations to counsel to the Committee and counsel to each of the DIP Lenders. Promptly upon entering into an 1110(b) Stipulation, the Debtors will file with the Court and serve notices of the Stipulation. Objections to an 1110(b) Stipulation must be filed and served on or before 4:00 p.m. prevailing Eastern Time on the date that is 10 days from the date of the filing of the Stipulation. Any 1110(b) Objection must set forth with specificity the basis for the objection. Unless the Court orders otherwise, upon the execution and filing of an 1110(b) Stipulation and timely performance of their obligations under the Stipulation by the Debtors: (i) the 1110(b) Stipulation will be deemed effective as of November 14, 2005, and (ii) the 60-day period set forth in Section 1110(a)(2) will be deemed to have been extended with respect to the Aircraft Equipment for the period provided therein. If an 1110(b) Objection has been timely filed and the dispute relating to the Objection is not resolved consensually among the parties within 10 days of the date of the Objection, the Debtors will schedule a hearing to consider the Objection. Filing Under Seal Due to the confidential and sensitive commercial nature of the information that will be contained within the 1110 Election Notices and 1110(b) Stipulations, including Cure Amounts and modifications to the applicable Aircraft Agreements, the Debtors will file those documents under seal pursuant to Section 107(b) of the Bankruptcy Code and Rule 9018 of the Federal Rules of Bankruptcy Procedure. Headquartered in Atlanta, Georgia, Delta Air Lines -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 502 destinations in 88 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. The Company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. As of June 30, 2005, the Company's balance sheet showed $21.5 billion in assets and $28.5 billion in liabilities. (Delta Air Lines Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., 215/945-7000) DENBURY RESOURCES: Shareholders Approve 2-for-1 Stock Split ----------------------------------------------------------- Denbury Resources Inc.'s (NYSE: DNR) stockholders have approved an amendment to the Company's certificate of incorporation to increase the number of authorized shares of common stock from 100 million shares to 250 million shares and to split the common stock two-for-one. This action was taken at a special meeting of the stockholders held on October 19, 2005. Stockholders of record as of the close of business on October 31, 2005, will receive one additional share of Denbury common stock for each share of common stock held at that time, to be distributed on November 7, 2005. The Company will have approximately 115 million shares outstanding after the stock split. Denbury Resources, Inc. -- http://www.denbury.com/-- is a growing independent oil and gas company. The Company is the largest oil and natural gas operator in Mississippi, owns the largest reserves of CO2 used for tertiary oil recovery east of the Mississippi River, and holds key operating acreage in the onshore Louisiana and Texas Barnett Shale areas. The Company increases the value of acquired properties in its core areas through a combination of exploitation drilling and proven engineering extraction practices. * * * As reported in the Troubled Company Reporter on Mar. 15, 2004, Standard & Poor's Ratings Services affirms its 'BB-' corporate credit rating on Denbury Resources, Inc., and revised its outlook on the company to positive from stable. DIDIER ROGEZ: Case Summary & 6 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Didier Jacques Rogez 25617 Fremont Road Los Altos, California 94022 Bankruptcy Case No.: 05-58399 Chapter 11 Petition Date: October 14, 2005 Court: Northern District of California (San Jose) Judge: Arthur S. Weissbrodt Debtor's Counsel: Charles E. Logan, Esq. Law Office of Charles E. Logan 95 South Market Street, #660 San Jose, California 95113 Tel: (408) 995-0256 Total Assets: $14,122,247 Total Debts: $8,771,315 Debtor's 6 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Bank of the West 1997 Porsche 993 $15,018 P.O. Box 4002 105,000 miles Concord, CA 94524 Poor Condition Value of security: $10,000 Ford Credit 1999 Ford Explorer $8,620 P.O. Box 239801 (Son's car) Las Vegas, NV 89123-0040 Value of security: $8,000 Citi Cards Credit card purchases $2,569 P.O. Box 6401 (VISA) The Lakes, NV 88901-6401 Citi Cards Credit card purchases $2,429 P.O. Box 6401 (MASTERCARD) The Lakes, NV 88901-6401 Bert D. Rouleau DMD Medical services $800 1174 Castro Street, Suite 120 Mountain View, CA 94040 Citi Cards Credit card purchases $33 P.O. Box 6401 (MASTERCARD) The Lakes, NV 88901-6401 DOMINIQUE LTD: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Dominique, Ltd. 98 San Jacinto, Suite 2000 Austin, Texas 78701 Bankruptcy Case No.: 05-17300 Chapter 11 Petition Date: October 12, 2005 Court: Western District of Texas (Austin) Judge: Frank R. Monroe Debtor's Counsel: Gray Byron Jolink, Esq. Law Office of Gray Byron Jolink 4131 Spicewood Springs Road, Bldg C-8 Austin, Texas 78759 Tel: (512) 346-7717 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. E*TRADE FINANCIAL: Earns $107.5 Mil of Net Income in Third Quarter ------------------------------------------------------------------ E*Trade Financial Corporation (NYSE: ET) reported results for its third quarter ended September 30, 2005, reporting net income of $107.5 million, compared to $79.3 million a year ago. Consolidated net revenue for the third quarter increased 26 percent to a record $422.8 million from $335.1 million a year ago. Total segment income increased 35 percent to $151.1 million from $111.7 million a year ago, generating a consolidated operating margin of 35.7 percent compared to 33.3 percent in the year ago period. Total client assets increased 28 percent year over year to $106.4 billion, including a record $19.5 billion in total customer cash and deposits. In the third quarter, net interest income represented 48 percent of total net revenue, up from 46 percent a year ago. Bank net interest spread increased one basis point sequentially and 10 basis points year over year to 223 basis points -- contributing to annual growth in net interest income of 32 percent. Total DARTs increased 29 percent year over year to 125,534, with retail DART volumes up 50 percent. The Company raised and narrowed its 2005 earnings guidance range to $1.04 to $1.09 per share from the previous range of $0.96 to $1.06. This range implies results of $0.25 to $0.30 per share in the fourth quarter. The revised guidance specifically excludes a net $0.05 per share gain resulting from the sale of E*TRADE Consumer Finance, partially offset by costs associated with the Company's acquisition of Harrisdirect, including incremental interest expense, restructuring and other deal-related costs. "Our strong operating and financial performance, combined with the power of consolidation, has strengthened the franchise -- accelerating our growth goals and delivering value to customers and shareholders," said Mitchell H. Caplan, Chief Executive Officer, E*Trade Financial Corporation. "In the third quarter we broadened and deepened our customer relationships through the continued adoption of E*TRADE Complete, creating growth in all of the key drivers of our business including assets, cash, borrowings and transactions." Other selected highlights from the third quarter of 2005: -- added 223,900 gross new Retail accounts, with 155,300 in trading/investing and 68,600 in deposit/lending accounts; -- increased total net revenue per customer by 23 percent and total segment income per customer by 32 percent over the year ago period; -- began expensing stock options through the adoption of FAS No.123(R) resulting in an increase of consolidated compensation and benefits of approximately $8 million; -- announced the acquisition of Harrisdirect from Bank of Montreal, which closed on October 6, gaining 430,000 customer accounts with average balances over $75,000, $34 billion in assets, $5 billion in customer cash, $900 million in margin debt balances and approximately 15,000 DARTs; -- announced the planned acquisition of BrownCo from JPMorgan Chase, gaining 200,000 customer accounts with average balances of $145,000, $29 billion in assets, $3.4 billion in customer cash, $3.2 billion in margin debt balances, and approximately 28,000 DARTs; and -- announced the planned acquisition of Kobren Insight Management to offer personalized wealth management services to retail customers, executing on the Company's regional investment advisor strategy. The E*Trade Financial family of companies provide financial services including trading, investing, banking and lending for retail and institutional customers. Securities products and services are offered by E(x)TRADE Securities LLC (Member NASD/SIPC). Bank and lending products and services are offered by E(x)TRADE Bank, a Federal savings bank, Member FDIC, or its subsidiaries. * * * As reported in the Troubled Company Reporter on Oct. 4, 2005, Standard & Poor's Ratings Services affirmed its 'B+' rating on E*TRADE Financial Corp. as a result of the announcement that E*TRADE will purchase BrownCo, a discount on-line broker with approximately 200,000 active customer accounts, from J.P. Morgan Chase & Co. S&P said the outlook on E*TRADE is stable. ENRON CORP: Court Approves JPMorgan Settlement on L/C Disputes -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York approved the settlement agreement between Enron Corporation and its debtor-affiliates and JP Morgan Chase Bank N.A. As reported in the Troubled Company Reporter on Sept. 29, 2005, Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, in New York, related that, prior to the bankruptcy petition date, JPMorgan and Citibank, N.A., as co-administrative agents, and JPMorgan as paying agent and issuing bank, are parties to a $500,000,000 Letter of Credit and Reimbursement Agreement, dated as of May 14, 2001, with Enron Corp. JPMorgan issued eight letters of credit: Beneficiary Applicant Draw Amount ----------- --------- ----------- Union Power Partners, L.P. NEPCO $55,827,8375 Panda Gila River, L.P. NEPCO $43,443,0987 Quachita Power, LLC NEPCO $16,437,220 Quachita NEPCO $24,750,000 Aquila Risk Management Corp. ENA $41,250,000 Mahonia Limited ENA $150,000,000 CALPX Trading Services EPMI $27,000,000 California Power Exchange Corp. EPMI $15,000,000 According to JPMorgan, the Debtors failed to reimburse $373,708,155 drawn under the L/Cs. JPMorgan, as Administrative Agent, filed consolidated proofs of claim against the Debtors in connection with the Syndicated L/C Agreement: Claim No. Debtor Basis For Claim Amount --------- ------ --------------- ------ 11166 Enron Reimbursement $374,456,329 11233 Enron Subrogation Unliquidated 11234 NEPCO Subrogation Unliquidated 11235 ENA Subrogation Unliquidated 11236 EPMI Subrogation Unliquidated 22135 NEPCO Subrogation Unliquidated 22136 NEPCO Power Subrogation Unliquidated 22137 Enron Power Subrogation Unliquidated 22138 NEPCO Services Subrogation Unliquidated On December 24, 2002, JPMorgan filed a complaint against the Debtors to recover the amounts it paid in connection with L/Cs issued to Union Power, Panda Gila, and Quachita, plus interest, costs and expenses. According to Mr. Rosen, JPMorgan, as Issuing Bank, Enron and NEPCO contend that: (i) Quachita drew amounts on the Quachita L/Cs that exceeded the amounts to which Quachita was entitled under a Turnkey, Engineering, Procurement, and Construction Agreement, dated June 27, 2000, between NEPCO and Quachita, and (ii) if the amounts drawn were proper at the time of each drawing, Quachita has since retained an amount in excess of that portion, if any, that it is entitled to retain. Each of JPMorgan, as Issuing Bank, Enron and NEPCO, also contends that Quachita, Cogentrix Quachita Holdings, Inc., and Cogentrix Energy, Inc., have wrongfully retained and are wrongfully retaining the Quachita Overdraws. Under an amended complaint, dated February 24, 2003, JPMorgan seeks to recover, among other things, the amount of the Quachita Overdraws from Quachita, Cogentrix Quachita, and Cogentrix. On May 20, 2004, Enron and NEPCO filed a complaint to recover the Quachita Overdraws from Quachita, Cogentrix Quachita, and Cogentrix. On January 9, 2004, the Debtors filed an avoidance action against various parties, including JPMorgan. In the complaint, the Debtors object to claims filed by JPMorgan in connection with the Syndicated L/C Agreement. Over a period of several months, the Debtors and JPMorgan have engaged in discussions to resolve matters of controversy between them. Settlement Agreement The settlement agreement between the parties provides these terms: (A) Dismissal of JP Morgan Adversary. JPMorgan will file with the Bankruptcy Court a stipulation dismissing the JPMorgan Syndicated Adversary; (B) Assistance in Quachita Litigations. The parties will use their reasonable best efforts to cooperate and assist each other in their efforts to pursue the Quachita Overdraws in the Enron Quachita Lawsuit and the Syndicated Cogentrix Lawsuit; (C) Reduction of the Claims. If and to the extent that the Enron Entities recover any amounts from any third party with respect to the Quachita Overdraws, the Claims will be reduced, on a dollar-for-dollar basis to the extent of monies collected and recovered. The Enron Entities will deliver all amounts, net of their out-of-pocket fees and expenses incurred in connection with the collection and recovery, to JPMorgan. To the extent JPMorgan recovers any amounts from any third party with respect to the Quachita Overdraws, JPMorgan will be entitled to retain the terms and conditions of the Syndicated L/C Agreement and the Claims will be reduced on a dollar-for-dollar basis to the extent of monies collected and recovered; (D) Partial Allowance/Bifurcation of L/C Claims. The Debtors will withdraw the Claims Objection with respect to four L/C Claims, solely to the extent of non-Recovery Action Indebtedness, and those Claims will be deemed allowed, solely on a pro rata basis, as Joint Liability Claims in these amounts: Current Non-Recovery Action Claim No. Debtor Indebtedness Class --------- ------ ------------------- ----- 11166 Enron $253,085,664 4 11235 ENA $129,349,938 5 11236 EPMI $28,406,261 6 22135 NEPCO $94,997,404 67 (E) Assignment of New Claim Numbers. Enron will cause the docketing agent to: (i) assign new claim numbers to the Allowed Claims and reflect the Claims on the claims registry, and (ii) reduce Claims Nos. 11166, 11235, 11236, and 22135 by the aggregate amount of the Allowed Claims. (F) Disputed Claims. Upon allowance, and the re-docketing and re-numbering of the Allowed Claims, Claim Nos. 11166, 11235, 11236, and 22135 will reflect solely the Recovery Action Indebtedness and will be reflected by the docketing agent in the claims registry as "disputed": Non-Recovery Action Claim No. Debtor Indebtedness Class --------- ------ ------------------- ----- 11166 Enron $104,790,585 4 11235 ENA $53,419,666 5 11236 EPMI $11,731,378 6 22135 NEPCO $39,232,564 67 (G) Treatment of Disputed Claims. The Disputed Claims will remain subject to the Claims Objection and all parties reserve their rights with respect thereto; provided, however, that the Enron Entities agree that they will not seek or attempt to subordinate the Claims of any holder of a portion of the Claims on the basis that JPMorgan served as the Co-Administrative Agent, Paying Agent and Issuing Bank; (G) Disallowance of Other Claims. Claims Nos. 11233, 11234, 22136, 22137, and 22138, will be deemed disallowed and expunged in their entirety; (G) Distributions on Claims. Payments pursuant to the Plan to holders of Claims constituting the Allowed Claims and, to the extent allowed, the Disputed Claims will be made to JPMorgan, in its capacity as Paying Agent; and (H) Releases and Indemnification. The Enron Parties and JPMorgan will release and indemnify each other from claims and liabilities. Headquartered in Houston, Texas, Enron Corporation -- http://www.enron.com/-- is in the midst of restructuring various businesses for distribution as ongoing companies to its creditors and liquidating its remaining operations. Before the company agreed to be acquired, controversy over accounting procedures had caused Enron's stock price and credit rating to drop sharply. Enron filed for chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033). Judge Gonzalez confirmed the Company's Modified Fifth Amended Plan on July 15, 2004, and numerous appeals followed. The Confirmed Plan took effect on Nov. 17, 2004. Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in their restructuring efforts. (Enron Bankruptcy News, Issue No. 160; Bankruptcy Creditors' Service, Inc., 15/945-7000) ENRON CORP: Gets Court Nod on TPL Guaranty Claims Settlement Pact ----------------------------------------------------------------- As previously reported, Enron Capital & Trade Resources Limited, an affiliate of Enron Corp., and Teesside Power Limited are parties to a Power Purchase Agreement, dated June 26, 1991, as amended. Enrici Power Marketing Limited, an affiliate of Enron, and TPL are parties to a Power Purchase Agreement dated June 26, 1991, as amended. On Nov. 29, 2001, ECTRL was placed into administration in the United Kingdom. In connection with its subsidiaries' obligations under the PPAs, Enron issued guaranties in favor of TPL: Issue Date Subsidiary ---------- ---------- 06/26/1991 Enrici 06/26/1991 Enron Power (U.K.) Limited. 12/31/1998 Enron Europe Limited. 06/21/2000 ECTRL On October 11, 2002, TPL filed Claim No. 10784 as a general unsecured claim against Enron for GBP597,357,687, equivalent to $849,263,424, plus contingent unliquidated amounts based on the ECTRL Guaranty. TPL filed contingent and unliquidated claims against the Debtors on account of the other guaranties. TPL asserts Claim Nos. 10781, 10782 and 10783 with respect to the Enrici, EPL and EEL Guaranties. The Reorganized Debtors objected to the Claims. After arm's-length negotiations, the Reorganized Debtors and TPL agree that: (i) the ECTRL Guaranty Claim will be allowed as a Class 4 general unsecured claim against Enron for $610,509,800; (ii) the Enrici Guaranty Claim will be allowed as a Class 4 general unsecured claim against Enron for $297,210,478; (iii) the EPL Guaranty Claim and EEL Guaranty Claim will be disallowed and expunged with prejudice; (iv) the amounts of the Allowed Enrici Guaranty Claim and the Allowed ECTRL Guaranty Claim include $1,192,840 and $5,823,625, respectively, for Value Added Tax liability under the PPAs based on supplies by TPL to ECTRL and Enrici under the PPAs. TPL will be entitled to an increased Class 4 general unsecured claim in the event that HM Revenue and Customs determines within 2 years from the date of the Settlement that TPL's VAT liability under the PPAs is greater than the amounts set forth; and (v) they will mutually release one another from all liabilities in connection with the Guaranties. Pursuant to Rule 9019(a) of the Federal Rules of Bankruptcy Procedure, the Reorganized Debtors ask the U.S. Bankruptcy Court for the Southern District of New York to approve their settlement agreement with TPL. The Court approves the settlement agreement. Headquartered in Houston, Texas, Enron Corporation -- http://www.enron.com/-- is in the midst of restructuring various businesses for distribution as ongoing companies to its creditors and liquidating its remaining operations. Before the company agreed to be acquired, controversy over accounting procedures had caused Enron's stock price and credit rating to drop sharply. Enron filed for chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033). Judge Gonzalez confirmed the Company's Modified Fifth Amended Plan on July 15, 2004, and numerous appeals followed. The Confirmed Plan took effect on Nov. 17, 2004. Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in their restructuring efforts. (Enron Bankruptcy News, Issue No. 160; Bankruptcy Creditors' Service, Inc., 15/945-7000) ENRON CORP: Court Approves General Electric Settlement Agreement ---------------------------------------------------------------- As previously reported in the Troubled Company Reporter, American Electric Power Service Corporation filed Claim No. 13802 against Enron Wind Systems, Inc., on account of damages for breach of warranty under an agreement entered into in connection with the construction of a wind farm located near Fort Davis, Texas. The Debtors objected to the AEP Claim. They claimed that General Electric Company assumed the liability to the Claim pursuant to a purchase agreement between them. On April 15, 2002, the Court had approved GE's acquisition of the U.S. and European manufacturing assets relating to the Debtors' Enron Wind Business. On June 30, 2005, the Reorganized Debtors filed a motion to enforce the terms and provisions of the Purchase Agreement and compel GE to take all actions consistent with its assumption of the liability for the warranty claims set forth in the AEP Claim. After arm's-length negotiations, the Reorganized Debtors and GE agree that: (1) the AEP Claim will be deemed disallowed and expunged in its entirety; (2) the Reorganized Debtors will withdraw the GE Motion; and (3) they will exchange mutual releases of claims in connection with the AEP claim provided that: -- the Reorganized Debtors do not waive or release GE from claims and causes of action in connection with the avoidance action it filed against GE on November 20, 2003, and amended on March 9, 2004, and -- other than the AEP Claim, the parties do not waive any claims, liabilities or other issues relating to the Sale Order and the Purchase Agreement. The Court approves the settlement agreement between the Debtors and General Electric Company. Headquartered in Houston, Texas, Enron Corporation -- http://www.enron.com/-- is in the midst of restructuring various businesses for distribution as ongoing companies to its creditors and liquidating its remaining operations. Before the company agreed to be acquired, controversy over accounting procedures had caused Enron's stock price and credit rating to drop sharply. Enron filed for chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-16033). Judge Gonzalez confirmed the Company's Modified Fifth Amended Plan on July 15, 2004, and numerous appeals followed. The Confirmed Plan took effect on Nov. 17, 2004. Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in their restructuring efforts. (Enron Bankruptcy News, Issue No. 158; Bankruptcy Creditors' Service, Inc., 15/945-7000) EXIDE TECH: Compensation Actions for Four Senior Officers Approved ------------------------------------------------------------------ In a regulatory filing with the Securities and Exchange Commission, Gordon A. Ulsh, president and chief executive officer of Exide Technologies, discloses that on Oct. 13, 2005, Exide's Compensation Committee approved these compensation actions for four senior corporate officers: Officer Designation Incentive Increase ------- ----------- --------- -------- Bregman, President from 40% to Mitchell S. Industrial Energy 50% of base Americas bonus salary Reverchon, President from 40% to Rodolphe Transportation 50% of base Europe bonus salary Damaska, VP, Corporate from $235,000 Phillip A. Controller salary to $255,000 Kupinsky, Exec. VP from $283,250 Stuart H. Gen. Counsel & salary to $350,000 Secretary Mr. Ulsh emphasizes that the targeted bonus under Exide's Corporate Incentive Plan for Messrs. Bregman and Reverchon are payable upon achievement of certain corporate goals. Headquartered in Princeton, New Jersey, Exide Technologies -- http://www.exide.com/-- is the worldwide leading manufacturer and distributor of lead acid batteries and other related electrical energy storage products. The Company filed for chapter 11 protection on Apr. 14, 2002 (Bankr. Del. Case No. 02-11125). Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland & Ellis, represent the Debtors in their restructuring efforts. Exide's confirmed chapter 11 Plan took effect on May 5, 2004. On April 14, 2002, the Debtors listed $2,073,238,000 in assets and $2,524,448,000 in debts. (Exide Bankruptcy News, Issue No. 76; Bankruptcy Creditors' Service, Inc., 215/945-7000) * * * As reported in the Troubled Company Reporter on July 8, 2005, Standard & Poor's Ratings Services lowered its corporate credit rating on Exide Technologies to 'CCC+' from 'B-', and removed the rating from CreditWatch with negative implications, where it was placed on May 17, 2005. "The rating action reflects Exide's weak earnings and cash flow, which have resulted in very high debt leverage, thin liquidity, and poor credit statistics," said Standard & Poor's credit analyst Martin King. Lawrenceville, New Jersey-based Exide, a manufacturer of automotive and industrial batteries, has total debt of about $740 million, and underfunded post-employment benefit liabilities of $380 million. FEDERAL-MOGUL: Incurs $48 Million Net Loss in Third Quarter ----------------------------------------------------------- Federal-Mogul Corporation (OTC Bulletin Board: FDMLQ) reported its financial results for the three and nine-month periods ended September 30, 2005. Federal-Mogul reported net sales of $1,500 million for the three-month period ended September 30, 2005, consistent with the comparable period of 2004. For the nine-month period ended September 30, 2005, net sales increased by $173 million, or 4%, to $4,799 million when compared to the same period of 2004, of which $82 million is due to favorable foreign currency. Gross margin for the three and nine-month periods ended September 30, 2005, when compared to the same periods of 2004, decreased by $49 million and $99 million, respectively. Increased pension costs adversely affected gross margin for the three and nine month periods ended September 30, 2005 by $14 million and $43 million. While raw material costs for the three months ended September 30, 2005, were comparable with those of the same period in 2004, raw material cost inflation reduced gross margin for the nine months ended September 30, 2005 by $40 million. Both the three and nine month periods ended September 30, 2005 were further impacted by other factors, primarily unfavorable volume and product mix. Management continues to identify and implement cost reduction and pricing strategies to mitigate the impact of these adverse factors. Federal-Mogul reported a loss from continuing operations before income taxes for the three-month period ended September 30, 2005 of $48 million compared with earnings from continuing operations before income taxes of $6 million for the same period of 2004. For the nine-month period ended September 30, 2005, the Company reported a loss from continuing operations before income taxes of $56 million, a decrease of $78 million from the same period of 2004. In addition to those same factors affecting gross margin, the year over year declines in results from continuing operations are primarily attributable to the impact of higher average interest rates, and the non-recurrence of a one-time gain recorded against Chapter 11 costs during third quarter of 2004, partially offset by reduced selling, general and administrative expenses. The Company reported Operational EBITDA of $115 million and $401 million for the three and nine month periods ended September 30, 2005. When compared to the same period of 2004, Operational EBITDA decreased by $21 million and $46 million, respectively, including $17 million and $53 million of increased pension expense. Combining cash provided from operating activities with cash used by investing activities, the Company has generated positive cash inflows of $47 million for the nine months ended September 30, 2005, compared with $83 million for the comparable period of 2004. "While our year-over-year net sales increased, several industry- wide challenges, such as increased pension expense, the continued high cost of raw materials, and higher interest rates, impacted our financial performance" said Chairman, President and Chief Executive Officer Jos� Maria Alapont. "We continue to drive our global profitable growth strategies, focusing on excellence in customer service and advancing our leading technology at the most competitive cost." Headquartered in Southfield, Michigan, Federal-Mogul Corporation -- http://www.federal-mogul.com/-- is one of the world's largest automotive parts companies with worldwide revenue of some US$6 billion. The Company filed for chapter 11 protection on Oct. 1, 2001 (Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin Brown & Wood, and Laura Davis Jones Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed US$10.15 billion in assets and US$8.86 billion in liabilities. At Dec. 31, 2004, Federal-Mogul's balance sheet showed a US$1.925 billion stockholders' deficit. At Mar. 31, 2005, Federal-Mogul's balance sheet showed a US$2.048 billion stockholders' deficit, compared to a US$1.926 billion deficit at Dec. 31, 2004. Federal-Mogul Corp.'s U.K. affiliate, Turner & Newall, is based at Dudley Hill, Bradford. FLYI INC: NASDAQ Says Market Cap Must Top $15 Million by Jan. 19 ---------------------------------------------------------------- The NASDAQ Stock Market, Inc., notified FLYi, Inc. (Nasdaq: FLYI) that for the 30 consecutive trading days preceding the date of its notification, the company's common stock has not maintained the minimum aggregate market value of publicly held shares of $15 million required for continued inclusion on the NASDAQ National Market pursuant to NASDAQ Marketplace Rule 4450(b)(e). The letter further notified the company that, in accordance with NASDAQ Marketplace Rule 4450(e)(1), the company will be provided 90 calendar days, or until Jan. 19, 2006, to regain compliance with the MVPHS requirement. Compliance will be achieved if the MVPHS is $15 million or more for 10 consecutive trading days prior to Jan. 19, 2006. The letter from NASDAQ further stated that if the company does not regain compliance with the Marketplace Rules by Jan. 19, 2006, NASDAQ will provide notice that the company's common stock will be delisted from the NASDAQ National Market. In the event of such notification, the company would have an opportunity to appeal NASDAQ's determination. The letter also noted that the company would have the opportunity to apply to transfer its common stock to the NASDAQ Capital (SmallCap) Market and that, if the company submits a transfer application and pays the applicable listing fees by Jan. 19, 2006, the initiation of delisting proceedings will be stayed pending NASDAQ staff review of the application. As previously disclosed, the company was informed by NASDAQ that the bid price of the company's common stock had closed below the $1.00 per share minimum required for continued inclusion on the NASDAQ National Market pursuant to NASDAQ Marketplace Rule 4450(a)(5). That notice further stated that, in accordance with NASDAQ Marketplace Rule 4450(e)(2), the company has been provided until Nov. 23, 2005, to regain compliance with the minimum bid price requirement. At the company's annual meeting, stockholders granted the Board of Directors discretion to amend the company's certificate of incorporation to effect a reverse stock split, which authorization was sought so that a reverse stock split might enable the company to regain compliance with the minimum bid price requirement. If and when the Board determines to implement a reverse split, the company will at that time announce its intention, the effective date of the reverse split and the actual ratio to be applied. Financial Woes In its Form 8-K filed with the SEC on Aug. 11, 2005, the carrier reported a net loss of $98.5 million for second quarter 2005, compared to second quarter 2004 net loss of $27.1 million. Revenue fell 24% to $117.5 million, and the Company's unrestricted cash was down to $66 million, from $107 million at the start of the quarter and $169 million at the end of 2004. At June 30, 2005, FLYi, Inc.'s balance sheet showed a $29,383,000 stockholders' deficit, compared to $167,134,000 of positive equity at Dec. 31, 2004. As reported in the Troubled Company Reporter on Aug. 12, 2005, Standard & Poor's Ratings Services revised the implications of its CreditWatch review on FLYi Inc. (CC/Watch Neg/--) to negative from developing. "The revision in CreditWatch status follows FLYi's second-quarter 10-Q filing, which continued to indicate substantial doubt about the airline's ability to continue as a going concern," said Standard & Poor's credit analyst Betsy Snyder. Bankruptcy Warning The company disclosed in its second-quarter 10-Q report with the SEC that it has engaged advisers and is making contingency plans for a potential Chapter 11 bankruptcy filing. Headquartered in Dulles, Va., FLYi Inc. -- http://www.flyi.com-- is the parent of Independence Air Inc., a small airline based at Washington Dulles International Airport. Independence Air offers low fares every day to a total of 45 destinations across America with comfortable leather seats and Tender Loving Service(SM). FOAMEX INT'L: Gets Final Court Approval on $320-Mil DIP Facility ---------------------------------------------------------------- As previously reported in the Troubled Company Reporter on Sept. 23, 2005, the Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware allowed Foamex International Inc., and its debtor-affiliates to access up to $221 million of the $240 million DIP Revolving Credit Facility arranged by Bank of America and obtain a new $80 million DIP Term Loan from Silver Point. On Oct. 17, 2005, the Court authorized the Debtors to execute and deliver all instruments and documents, and to pay all fees, that is required under the DIP Financing, including: (a) the execution, delivery and performance of the Loan Documents; (b) the execution, delivery and performance of amendments to the DIP Credit Agreements for additional financial institutions and reallocating the commitments for the Financing; and (c) the non-refundable payment of the Agents or Lenders of the fees referred to in the DIP Financing Documents and reasonable costs and expenses, provided that the Debtors will provide copies of all invoices to counsel for the Official Committee of Unsecured Creditors. Judge Walsh rules that the superpriority claims granted to Bank of America will be senior in all respects to the superpriority claims granted to Silver Point. With respect to avoidance actions, the DIP Obligations will constitute allowed administrative expense claims, pari passu with all other holders of allowed administrative expense claims. The superpriority claims and the DIP collateral, Judge Walsh declares, are not payable from, or have recourse to, any payments payable directly to third parties arising under any liability insurance policies maintained by the Debtors or Foamex Canada, Inc. The Court also authorizes the Debtors to use all Cash Collateral of U.S. Bank National Association, as senior secured notes trustee and collateral agent. U.S. Bank is granted replacement security interest with respect to the use of its Cash Collateral and any diminution in the value of the Collateral. The replacement lien is subordinate only to other valid and enforceable liens existing as of the Petition Date, the DIP Liens granted to Bank of America and Silver Point for the benefit of the DIP Lenders, and the Carve Out for U.S. Trustee fees and unpaid fees and expenses of bankruptcy professionals. As additional adequate protection, the Court directs the Debtors to pay the fees and expenses of O'Melveny & Myers LLP, the local counsel to the Ad Hoc Committee, Houlihan Lokey Howard & Zukin, and U.S. Bank, as Senior Secured Notes Trustee. Unless all DIP Obligations have been paid, the Debtors will not seek: (a) any modifications or extensions of the DIP Order without the written consent of the Agents; or (b) an order dismissing any of their Chapter 11 cases. Any official committee or other parties-in-interest have until January 15, 2006, to investigate and file actions challenging the validity, enforceability, priority and extent of the Debtors' prepetition obligations, and all the liens and security interests. A full-text copy of the 33-page Final DIP Order is available for free at http://bankrupt.com/misc/Foamex_final_DIP_order.pdf Headquartered in Linwood, Pa., Foamex International Inc. -- http://www.foamex.com/-- is the world's leading producer of comfort cushioning for bedding, furniture, carpet cushion and automotive markets. The Company also manufactures high- performance polymers for diverse applications in the industrial, aerospace, defense, electronics and computer industries. The Company and eight affiliates filed for chapter 11 protection on Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693). Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, represent the Debtors in their restructuring efforts. Houlihan, Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the ad hoc committee of Senior Secured Noteholders. As of July 3, 2005, the Debtors reported $620,826,000 in total assets and $744,757,000 in total debts. (Foamex International Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service, Inc., 215/945-7000) FOAMEX INT'L: Can Employ Miller Buckfire as Financial Advisor ------------------------------------------------------------- As previously reported in the Troubled Company Reporter on Oct. 3, 2005, as financial advisor, Miller Buckfire will render investment banking services to Foamex International Inc., and its debtor- affiliates, which will include: (a) assisting the Debtors in the analysis, design and formulation of its various options in connection with a Restructuring, which may include a Financing and Sale; (b) advising and assisting the Debtors in the structuring and effectuation of the financial aspects of transactions; (c) provide financial advise and assistance to the Debtors in developing and seeking approval of a plan of reorganization, including assisting the Debtors in negotiations with the Debtors' constituencies; (d) if applicable, identifying, soliciting and negotiating with potential Investors in connection with any Financing or potential acquirers in connection with any Sale; and (e) participating in hearings before the U.S. Bankruptcy Court for the District of Delaware with respect to matters upon which Miller Buckfire has provided advice, including, as relevant, coordinating with the Company's counsel. The Debtors propose to pay Miller Buckfire: -- a $150,000 Monthly Advisory Fee. The Monthly Advisory Fee will be credited in full against any Restructuring Transaction Fee payable to Miller Buckfire. -- a Restructuring Transaction Fee equal to 1% of the allowed amount of the Debtors' first and second lien and subordinated bond indebtedness only. The Debtors will also reimburse the firm for its travel and other reasonable out-of-pocket expenses incurred. Before the Petition Date, the Debtors paid Miller Buckfire $600,000 for Monthly Advisory Fees and financing fees of $3,200,000 in connection with the refinancing of credit facilities and obtaining DIP Financing commitments. As customary, the Debtors will indemnify Miller Buckfire and its affiliates under certain circumstances. Ronen Bojmel, a principal at Miller Buckfire, attests that the firm does not have any connection with any Debtors, their affiliates, their creditors or any other interested parties; is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code; and does not hold or represent any interest adverse to the Debtors or their estates. The Honorable Peter J. Walsh of the District of Delaware Bankruptcy Court approves the Debtors' request and modifies the indemnification provisions agreed upon by the parties: (a) Miller Buckfire is not entitled to indemnification, contribution or reimbursement other than the financial advisory and investment banking services provided in the Engagement Letter, unless approved by the Court. (b) The Debtors are not obligated to indemnify any person, or provide contribution or reimbursement to any person, to the extent any claim or expense is either judicially determined to have arisen from that person's bad faith, gross negligence or willful misconduct, or settled before a judicial determination. (c) If Miller Buckfire believes it is entitled to indemnification and reimbursement payment, it must file an application, and the Debtors may not pay any amount before the entry of a Court order. Furthermore, Judge Walsh rules that none of Miller Buckfire or its affiliates will have any liability to the Debtors or any person asserting claims on behalf of the Debtors. The Court makes it clear that since Miller Buckfire was retained as an independent contractor, it does not have authority to bind, represent or act as an agent, executor, administrator, trustee, lawyer or guardian for the Debtors. Miller Buckfire also does not have authority to manage the Debtors' money or property. Headquartered in Linwood, Pa., Foamex International Inc. -- http://www.foamex.com/-- is the world's leading producer of comfort cushioning for bedding, furniture, carpet cushion and automotive markets. The Company also manufactures high- performance polymers for diverse applications in the industrial, aerospace, defense, electronics and computer industries. The Company and eight affiliates filed for chapter 11 protection on Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693). Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, represent the Debtors in their restructuring efforts. Houlihan, Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the ad hoc committee of Senior Secured Noteholders. As of July 3, 2005, the Debtors reported $620,826,000 in total assets and $744,757,000 in total debts. (Foamex International Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service, Inc., 215/945- 7000) FOAMEX INT'L: Court Sets December 5 as General Claims Bar Date -------------------------------------------------------------- As previously reported in the Troubled Company Reporter on Oct. 17, 2005, Foamex International Inc., and its debtor- affiliates ask the U.S. Bankruptcy Court for the District of Delaware to establish December 5, 2005, as the last day by which all entities holding prepetition claims, other than governmental units, must file proofs of claim. Bar Date Notice Package The Debtors propose to serve on all known entities holding potential prepetition claims with: (a) a notice of the Bar Dates; (b) a proof of claim form substantially in the form of Official Form No. 10. Proofs of claim are to be submitted in person or by courier service, hand delivery or mail. Proofs of claim submitted by facsimile or e-mail will not be accepted. Establishing December 5, 2005, as the General Bar Date in the Debtors' Chapter 11 cases will provide potential claimants with an adequate amount of time after the mailing of the Bar Date Notice to review the Debtors' Schedules and compare them with their own books and records, Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, says. Court Approval The Honorable Peter J. Walsh of the District of Delaware Bankruptcy Court directs entities holding a prepetition claim against the Debtors to file a proof of claim by the December 5 General Bar Date. Judge Walsh sets the General Bar Date as the date that is 45 days after the Bar Date Notice Package are mailed. Judge Walsh permits any entity asserting claims against the Debtors for personal or bodily injury and wrongful death arising out of the 2003 Station Fire to file: (a) a consolidated proof of claim with other entities asserting claims, provided that the consolidated claim identifies all the entities asserting claims through the consolidated claim and the amounts asserted by each claimant; (b) a proof of claim asserting unliquidated claims; (c) a proof of claim asserting claims against the Debtors provided that the claim identifies the particular Debtors against whom the claims are asserted; and (d) a proof of claim by and through any authorized agent. The Court does not require ACE American Insurance Company to file any proofs of claim in the Debtors' bankruptcy cases. Headquartered in Linwood, Pa., Foamex International Inc. -- http://www.foamex.com/-- is the world's leading producer of comfort cushioning for bedding, furniture, carpet cushion and automotive markets. The Company also manufactures high- performance polymers for diverse applications in the industrial, aerospace, defense, electronics and computer industries. The Company and eight affiliates filed for chapter 11 protection on Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693). Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, represent the Debtors in their restructuring efforts. Houlihan, Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the ad hoc committee of Senior Secured Noteholders. As of July 3, 2005, the Debtors reported $620,826,000 in total assets and $744,757,000 in total debts. (Foamex International Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service, Inc., 215/945-7000) FREEDOM RINGS: Wants Young Conaway as Bankruptcy Counsel -------------------------------------------------------- Freedom Rings, LLC, asks the Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware for permission to employ Young Conaway Stargatt & Taylor, LLP, as its bankruptcy counsel, nunc pro tunc to Oct. 16, 2005. Young Conaway will: (a) provide legal advice with respect to the Debtor's powers and duties as debtor-in-possession in the continued operation of its business and management of its properties; (b) assist in the preparation and pursuit of confirmation of a plan and approval of a disclosure statement; (c) prepare, on behalf of the Debtor, necessary applications, motions, answers, orders, reports and other legal papers; (d) appear in Court and to protect the interests of the Debtor before the Court; and (e) perform all other legal services for the Debtor, which may be necessary and proper in the Debtor's bankruptcy case. M. Blake Cleary, Esq., a partner at Young Conaway Stargatt & Taylor, LLP, discloses that the Firm received a $100,000 retainer. The current hourly rates of professionals engaged are: Professional Hourly Rate ------------ ----------- M. Blake Cleary, Esq. $385 Matthew B. Lunn, Esq. $290 Margaret B. Whiteman, Esq. $225 Gregory J. Babcock, Esq. $200 Kimberly A. Beck $145 The Debtor believes that Young Conaway Stargatt & Taylor, LLP, is disinterested as that term is defined in Section 101(14) of the U.S. Bankruptcy Code. With nearly 100 attorneys in Wilmington, Delaware, Young Conaway Stargatt & Taylor, LLP -- http://www.ycst.com/home.asp-- represents national, international and local clients handling sophisticated advisory and litigation matters. Headquartered in Winston-Salem, North Carolina, Freedom Rings LLC is a majority-owned subsidiary and franchisee partner of Krispy Kreme Doughnuts, Inc., in the Philadelphia region. The Debtor operates six out of the approximately 360 Krispy Kreme stores and 50 satellites located worldwide. The Company filed for chapter 11 protection on Oct. 16, 2005 (Bankr. Del. Case No. 05-14268). M. Blake Cleary, Esq., Margaret B. Whiteman, Esq., and Matthew Barry Lunn, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it estimated between $10 million to $50 million in assets and debts. FREEDOM RINGS: Wants Donlin Recano as Claims & Noticing Agent ------------------------------------------------------------- The Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware gave Freedom Rings, LLC, permission to employ Donlin Recano & Company, Inc., as its claims, noticing and balloting agent. Donlin Recano will: (a) prepare and serve required notices in the Debtor's chapter 11 case, including: (1) a notice of commencement of the Debtor's bankruptcy case and the initial meeting of creditors under Section 341(a) of the Bankruptcy Code; (2) a notice of the claims bar date; (3) notices of objections to claims; (4) notices of any hearings on a disclosure statement and confirmation of a plan or reorganization; (5) other miscellaneous notices as the Debtor or the Court may deem necessary or appropriate for an orderly administration of the Debtor's bankruptcy case; and (6) assist in the publication of required notices, as necessary; (b) within five business days after the service of a particular notice, prepare for filing with the Clerk's Office an affidavit of service that includes: (1) a copy of the notice served; (2) an alphabetical list of persons on whom the notice was served, along with their addresses; and (3) the date and manner of service; (c) maintain copies of all proofs of claim and proofs of interest filed in the Debtor's chapter 11 case; (d) maintain official claims register in the Debtor's case by docketing all proofs of claim and proofs of interest in a claims database that includes the following information for each claim or interest asserted: (1) the name and address of the claimant or interest holder and any agent if the proof of claim or proof of interest was filed by an agent; (2) the date the proof of claim or proof of interest was received by Donlin Recano or the Court; (3) the claim number assigned to the proof of claim or proof of interest; and (4) the asserted amount and classification of the claim; (e) implement necessary security measures to ensure the completeness and integrity of the claims register; (f) transmit to the Clerk's Office a copy of the claims register on a weekly basis, unless requested by the Clerk's Office on a more or less frequent basis; (g) maintain a current mailing list for all entities that have filed proofs of claim or proofs of interest and make the list available to the Clerk's Office or any party-in-interest upon request; (h) provide access to the public for examination of copies of the proofs of claim or proofs of interest filed in the Debtor's case without charge during regular business hours; (i) create and maintain a public access website setting forth pertinent case information and allowing access to electronic copies of proofs of claim or proofs of interest; (j) record all transfers of claims pursuant to Bankruptcy Rule 3001(e) and give notice of those transfers as required by Bankruptcy Rule 3001(e); (k) assist the Debtor in the reconciliation and resolution of claims; (l) comply with applicable federal, state, municipal and local statutes, ordinances, rules, regulations, orders and other requirements; (m) assign temporary employees to process claims, as necessary; (n) promptly comply with further conditions and requirements as the Clerk's Office or the Court may at any time prescribe; (o) provide balloting and solicitation services, including preparing ballots, producing personalized ballots and tabulating creditor ballots on a daily basis; and (p) provide other claims processing, noticing, balloting, disbursing and related administrative services as may be requested from time to time by the Debtor. Louis A. Recano, a principal at Donlin Recano & Company, Inc., disclosed that the Firm will receive a $1,000 retainer. The current hourly rates of professionals engaged are: Designation Hourly Rate ----------- ----------- Principal $65 to $275 Other professionals $140 (Average) The Debtor believes that Donlin Recano & Company, Inc., is disinterested as that term is defined in Section 101(14) of the U.S. Bankruptcy Code. Donlin Recano & Company, Inc. -- http://donlinrecano.net-- is a data processing firm that specializes in chapter 11 administration, consulting and analysis, including noticing, claims processing, voting and other administrative tasks in chapter 11 cases. Headquartered in Winston-Salem, North Carolina, Freedom Rings LLC is a majority-owned subsidiary and franchisee partner of Krispy Kreme Doughnuts, Inc., in the Philadelphia region. The Debtor operates six out of the approximately 360 Krispy Kreme stores and 50 satellites located worldwide. The Company filed for chapter 11 protection on Oct. 16, 2005 (Bankr. Del. Case No. 05-14268). M. Blake Cleary, Esq., Margaret B. Whiteman, Esq., and Matthew Barry Lunn, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it estimated between $10 million to $50 million in assets and debts. GOLD KIST: Moody's Affirms $130 Million Unsec. Notes' Rating at B2 ------------------------------------------------------------------ Moody's Investors Service affirmed Gold Kist Inc.'s B2 senior unsecured and B1 corporate family ratings, as well as its SGL-1 speculative grade liquidity rating, and changed the rating outlook to positive from stable. The change in ratings outlook to positive reflects Gold Kist's leverage reduction over the past year, as well as its strong liquidity profile which has improved the company's financial flexibility. Ratings affirmed are: 1) $130 million senior unsecured notes, due 2014 at B2 2) Corporate family rating at B1 3) Speculative grade liquidity rating at SGL-1 Moody's does not rate the company's $125 million senior secured revolving credit facility, maturing 2007; or approximately $16 million of other unsecured debt. Gold Kist's ratings are limited by its business concentration on a single protein (chicken) and the inherent earnings volatility of the poultry business. Gold Kist is exposed to volatile commodity input and output prices that have at times caused wide swings in the company's profitability (on occasion over 100% per year). In addition, a large portion of Gold Kist's sales are from the commodity fresh and frozen chicken segment, which is more susceptible to competitive pricing and margin pressures; only 15- 20% of its products are further processed. The company also operates within a very mature, highly competitive, and low margin industry which lacks the earning stability enjoyed by larger and more diversified food companies. While Gold Kist has benefited from very favorable industry conditions over the past year, Moody's expects these unusually strong conditions to weaken in the years ahead. The ratings also consider that poultry markets can be materially impacted by international trade-related issues such as the establishment of tariffs or import regulations by key export markets. Export markets are important to US chicken processors as they provide an outlet for dark meat and other chicken products not valued by the US consumers. In addition, poultry operations are exposed to potential disease and product contamination related losses. Moody's views as growing event risk the present global spread of high pathogenic avian influenza. While the largest concentration of the disease is in certain Asian countries, the disease is spreading. It is impossible to tell if the disease will become a material problem in the US. But, should an outbreak occur, trading partners could prohibit the import of US poultry with negative repercussions for US producers and processors. Gold Kist's ratings are supported by its position as the third largest US chicken processor, with an estimated market share of about 9%, behind Tyson (22%) and Pilgrim's Pride (16%). US chicken consumption trends are favorable, showing steady but modest growth. Gold Kist has a strong regional presence in the southeast US, where it has operated integrated poultry processing operations since 1951. The company has well-established relationships with major retail, foodservice and industrial customers, and a stable base of poultry contract growers. In recent years, Gold Kist has pared non- poultry operations and now is focused almost exclusively on chicken. The company's has earmarked $200 million of capital spending over the next few years to expand its further processed capacity and to reduce its cost base in an effort to enhance its ability to withstand commodity input and output pricing pressures. The company is currently on track in terms of timing on these projects. The ratings gain further support from debt reduction over the past year and the build-up of a strong liquidity cushion, developments that have been facilitated by the supportive chicken market, as well as cash proceeds from its initial public offering in 2004. Debt has been reduced to $207 million at July 2, 2005 from $304 million at June 26, 2004, while cash balances have increased to $197 million from $136 million. Most recently in September 2005, Gold Kist repaid most remaining secured debt and thus largely eliminated required debt amortizations over the next few years. As of July 2, 2005, Gold Kist had approximately $297 million in debt (incorporating Moody's standard analytical adjustments which include pension and operating lease adjustment), representing about 1.1x 7/2/05 LTM EBITDA. Gold Kist's ratings could be upgraded over time if: 1) the company is able to sustain solid operating performance and financial flexibility even as industry conditions weaken; 2) it continues to develop a track record as a well-run publicly traded company; and 3) event risk from avian influenza outbreak declines. It would also require the company to be able to sustain Debt/EBITDA (based on Moody's standard analytic adjustments) in the 3.5x range, with free cash flow to debt in the 12-15% range. Conversely, Gold Kist's ratings could stabilize at their current level if: * operating performance weakens; * avian influenza issues begin to negatively impact US markets; or * leverage increases such that Debt/EBITDA weakens and is likely to remain in the 4.0X to 6.0X range, with free cash flow to debt in the 5-11.0% range. Ratings could come under downward pressure if free cash flow could be expected to drop and remain below 5% of outstanding debt and Debt/EBITDA exceeds 5.0x EBITDA in a down cycle. Gold Kist's senior unsecured notes are guaranteed by subsidiaries. The notes are notched down from the corporate family rating because they rank junior to the company's senior secured debt, which could increase from current levels to a much more material portion of the capital structure. Gold Kist's SGL-1 liquidity rating reflects Moody's expectation that Gold Kist will have very good liquidity over the next year. Moody's expects that existing cash balances and internal cash flow generation will cover cash needs over the next year, revolver availability will be comfortable, and covenant cushion sufficient. As of July 2, 2005 the company had no drawings under its revolver but had approximately $31 million of letters of credit issued under it. Gold Kist's assets are fully pledged, limiting asset sales as an alternative source of liquidity. Gold Kist, Inc., with revenues exceeding $2.2 billion, is a producer and processor of fresh and further processed chicken. The company's headquarters are in Atlanta, Georgia. HEILIG-MEYERS: Inks Settlement Pact with Prepetition Lenders ------------------------------------------------------------ Heilig-Meyers Company and its debtor-affiliates ask the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division, to approve a global settlement and compromise of pending claims and litigation with their prepetition lenders. Nature of Conflict On July 29, 2002, the Debtors' Official Committee of Unsecured Creditors commenced an adversary proceeding against the prepetition lenders seeking to avoid and recover the proceeds of more than $200 million of liens, security interests and payments. On December 21, 2004, the Bankruptcy Court issued a Revised Memorandum Opinion stating that the Debtors were unable to prove they were insolvent at the time of the transfers. The Debtors appealed the Bankruptcy Court's decision to the United States District Court for the Eastern District of Virginia. The District Court uphold the Bankruptcy Court's decision in all respects. On September 13, the Debtors then brought the matter to the Fourth Circuit Court of Appeals. The appeal is currently pending in the Circuit Court. Asset Sale Proceeds Since the Debtor's bankruptcy filing, they have liquidated property in which the Collateral Agent, Wachovia Bank, N.A., held a lien or security interest for the benefit of the prepetition lenders. The Debtors were able to remit $137 million of sale proceeds to the Collateral Agent since Jan. 31, 2005. Collateral Cap On May 18, the Court confirmed HMY RoomStore, Inc.'s Joint Plan of Reorganization and subsequently ruled that: a) the prepetition lenders' secured claim will be limited to $128.5 million; b) the prepetition lenders are not entitled to recover postpetition interest or professional fees from RoomStore or the other Debtors; c) the Collateral Agent was required to disgorge all collateral proceeds received from the Debtors in excess of $128.5 million. In compliance with the Court's May 18 ruling, Wachovia remitted $8,485,807 to the Debtors. Wachovia also filed an appeal of the RoomStore confirmation order to the District Court [Case No. 3:05-CV-00481-HEH]. The appeal is pending in the District Court. Other Adversary Proceedings On March 9, 2005, the Debtors commenced an adversary proceeding, the Turnover Action, against Wachovia seeking to share in certain of the collateral proceeds. On Aug. 19, 2005, the prepetition lenders filed an objection to the Debtors' Second Amended and Restated Joint Liquidating Plan of Reorganization. Settlement and Compromise The Debtors, the Committee and the prepetition lenders have negotiated a settlement agreement to resolve their multiple disputes and claims to avoid further expense and inconvenience associated with protracted litigation. The salient terms of the settlement agreement are: a) a $2 million cash payment to the Debtors from the prepetition lenders; b) dismissal with prejudice of the avoidance litigation appeal pending in the Fourth Circuit; the Debtors will pay the costs associated with the dismissal; c) dismissal with prejudice of the RoomStore confirmation appeal; Wachovia will pay the costs associated with the dismissal; d) withdrawal of the confirmation objection after amending the Liquidating Plan; e) dismissal of the Turnover litigation; f) dismissal of the collateral cap litigation; g) the prepetition lenders will waive their unsecured claims and administrative claims against the Debtors; and h) the Bank Group will transfer cash proceeds of their collateral equal to $20,127,036 to an interest-bearing cash collateral account with Wachovia for the purspose of securing the Debtors' reimbursement obligations under their prepetition workers compensation letters of credit. The Prepetition Lenders: i) the Bank Group: -- Wachovia Bank, N.A., -- Bank of America, N.A., -- SunTrust Bank, N.A., -- J.P. Morgan Chase, N.A., -- PNC National Bank, -- Calyon Financial, Inc., -- The Bank of Tokyo Mitsubishi, Ltd., -- Mizuho Financial Group, and -- Highland Capital Management, L.P., ii) The Prudential Insurance Company of America and Pruco Life Insurance Company, and iii) Wachovia Bank, N.A. (as successor to First Union National Bank, N.A.) as a lessor under certain prepetition synthetic leases executed with one or more of the Debtors. Wachovia Bank, National Association, serves as the administrative agent for the Bank Group and as collateral agent for all of the prepetition lenders. Heilig-Meyers Company filed for chapter 11 protection on Aug. 16, 2000 (Bankr. E.D. Va. Case No. 00-34533), reporting $1.3 billion in assets and $839 million in liabilities. When the Company filed for bankruptcy protection it operated hundreds of retail stores in more than half of the 50 states. In April 2001, the company shut down its Heilig-Meyers business format. In June 2001, the Debtors sold its Homemakers chain to Rhodes, Inc. GOB sales have been concluded and the Debtors are liquidating their remaining Heilig- Meyers assets. Bruce H. Matson, Esq., Vernon E. Inge, Jr., Esq., Katherine Macaulay Mueller, Esq., at LeClair Ryan, represent the Debtors. HOANG NGUYEN: Case Summary & 16 Largest Unsecured Creditors ----------------------------------------------------------- Debtors: Hoang V. Nguyen & Than K. Lam 204 Teakwood Drive Youngsville, Louisiana 70592 Bankruptcy Case No.: 05-53751 Chapter 11 Petition Date: October 15, 2005 Court: Western District of Louisiana (Lafayette/Opelousas) Judge: Gerald H. Schiff Debtors' Counsel: William C Vidrine, Esq. Vidrine & Vidrine, P.L.L.C. Secondary Login 711 West Pinhook Road Lafayette, Louisiana 70503 Tel: (337) 233-5195 Fax: (337) 233-3897 Total Assets: $407,770 Total Debts: $2,243,507 Debtors' 16 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Caterpillar Financial Bank Charges $700,000 Services Corp. Value of Collateral: 2120West End Avenue $240,000 Nashville, TN 37203 Business Loan Center Bank Loan $682,000 645 Madison Ave., 19th Floor Value of Collateral: New York, NY 10022 $250,000 Zions Bank Bank Loan $448,892 P.O. Box 25822 Salt Lake City, UT 84125 Irwin Mortgage Corp $80,937 Chase $34,915 Direct Merchants Bank $10,464 Amex $10,457 Discover $9,640 AT&T $8,879 Att and T Universal/ Citibank $8,689 Citi Platinum Card $7,431 Citibank $7,269 Cbusasears $4,717 Monogram Bank North America $4,715 Sears Gold Mastercard $2,868 Revenue Sys $1,603 HUDSON VALLEY: Columbia Agency Slams Cash Collateral & DIP Funding ------------------------------------------------------------------ The Columbia County Industrial Development Authority, Columbia County Economic Development Corporation, and the County of Columbia, State of New York oppose Hudson Valley Care Centers, Inc.'s request: -- to obtain cash through a Receivership Agreement with Whittier Health Services, Inc., -- to obtain secured postpetition financing from an undisclosed lender, and -- use cash collateral securing repayment of indebtedness to Whittier Health Services and Greenleaf IV, LLC. The petitioners have a secured priority claims against the Debtor in excess of $530,000. On June 16, 2005, the IDA and the County commenced an action in the Supreme Court, Columbia County seeking to restrain payments from the New York State Department of Health to Hudson Valley and its receiver, and a money judgment in the amount of $530,759. The IDA and the County wants the Debtor's requests denied because: a) it hasn't filed a Schedules and Statement of Financial Affairs; b) it doesn't operate the Green Manor Nursing Home and isn't responsible for the cost of operation of the facility; and c) it hasn't provided enough information to support its need for postpetition financing. The petitioners are confused why the Debtor needs the financing when Whittier, under the Receivership Agreement, has assumed responsibility for funding the operation of the facility. Also, the IDA and County believes that the Receivership does not provide for a credit facility to which the Debtor may avail itself. Most importantly, the Debtor failed to identify the secured lender, to describe the amount of loan, interest rate, terms of payment and provide a copy of the proposed financing agreements, the IDA and the County assert. Headquartered in Ghent, New York, Hudson Valley Care Centers, Inc., operates a nursing home. The Debtor filed for chapter 11 protection on September 13, 2005 (Bankr. N.D.N.Y. Case No. 05-16436). Michael D. Assaf, Esq., at O'Connell and Aronowitz represents the Debtor. When the Debtor filed for protection from its creditors, it estimated assets between $100,000 to $500,000 and debts between $10 million to $50 million. HUDSON VALLEY: Wants Access to Whittier & Greenleaf's Collateral ---------------------------------------------------------------- Hudson Valley Care Centers, Inc., asks the U.S. Bankruptcy Court for the Northern District of New York for authority to: a) obtain postpetition credit from an undisclosed lender; b) utilize the credit facility provided under the Receivership Agreement with Whittier Health Services, Inc.; and c) use cash collateral securing repayment to Greenleaf IV, Inc., and Whittier Health Services, Inc. The Debtor tells the Court it urgently needs working capital to maintain its operations during the chapter 11 process pending the sale of its assets. Without fresh capital, the Debtor will be forced to cease operations resulting in the loss of the going concern value of its estate. Prepetition Debt On March 30, 2005, the New York State Department of Health approved the assumption of operation of the Debtor's nursing facility, Green Manor Health Care Complex, pursuant to a Receivership Agreement with Whittier Health Services. Under the receivership pact, Whittier agreed to provide funds necessary to pay the costs and expenses of operating and maintaining the facility. As of Hudson's bankruptcy filing, it owes Whittier $1,058,102. The Debtor also owes Greenleaf IV $23,900,120. The debt is secured by a lien on all of the Debtor's machinery, equipment, contracts, accounts receivable, and other assets. Adequate Protection To provide the lenders with adequate protection required under 11 U.S.C. Sec. 363 for any diminution in the value of their collateral, the Debtor proposes to grant Whittier and Greenleaf replacement liens to the same extent, validity and priority as the prepetition lien. Headquartered in Ghent, New York, Hudson Valley Care Centers, Inc., operates a nursing home. The Debtor filed for chapter 11 protection on September 13, 2005 (Bankr. N.D.N.Y. Case No. 05-16436). Michael D. Assaf, Esq., at O'Connell and Aronowitz represents the Debtor. When the Debtor filed for protection from its creditors, it estimated assets between $100,000 to $500,000 and debts between $10 million to $50 million. INLAND FIBER: Noteholders Disclose Info on Confidentiality Pacts ---------------------------------------------------------------- An ad hoc committee of the holders of the 9-5/8% senior notes due 2007 issued by Inland Fiber Group, LLC -- f/k/a U.S. Timberlands Klamath Falls, LLC -- has disclosed information pursuant to confidentiality agreements with Inland Fiber. The members of the ad hoc committee include GoldenTree Asset Management LP, OppenheimerFunds, Inc., QVT Financial, LP, and Turnberry Capital Management, L.P. The ad hoc committee has been in discussions with Inland Fiber with regard to Inland Fiber's defaults under its indenture and the potential settlement of litigation claims that have been asserted by U.S. Bank National Association, as indenture trustee to the notes, against Inland Fiber and certain related entities and individuals in an action commenced in the Delaware Court of Chancery captioned U.S. Bank National Association v. U.S. Timberlands Klamath Falls, L.L.C., Inc. n/k/a Inland Fiber Group, LLC, et al., C.A. No. 112-N. Confidentiality Agreement In connection with these discussions, in June 2005, each of the members of the committee executed a confidentiality agreement with Inland Fiber and received confidential non-public materials regarding Inland Fiber and the litigation. The confidentiality agreements provided that, upon termination, Inland Fiber would disclose to the public generally all material information that had been provided to the members of the committee. The confidentiality agreements further provided that in the event that Inland Fiber failed to disclose the information, the members of the committee have the right to do so. The confidentiality agreements terminated in July 2005. The committee has requested that Inland Fiber disclose the required information in accordance with the confidentiality agreements. As of Oct. 21, 2005, Inland Fiber has not complied with this request. Accordingly, the members of the committee, in the exercise of their respective rights under the confidentiality agreements, have disclosed the information, which can be accessed at http://www.inlandfiberinformation.com/ Headquartered in Klamath Falls, Oregon, Inland Fiber Group, LLC, owns 167,000 fee acres of timberlands and cutting rights on 68,000 acres of timberlands containing an aggregate amount of merchantable timber volume of approximately 0.4 billion board feet. * * * As reported in the Troubled Company Reporter on July 11, 2005, Moody's Investors Service lowered the rating of Inland Fiber Group, LLC's $225 million 9 5/8% senior secured notes to Ca from Caa3. Moody's also lowered the company's senior implied and issuer ratings to Ca from Caa3. Moody's said the outlook is stable. INTEGRATED HEALTH: Ct. Okays Reward & Coverage Lawsuit Settlement ----------------------------------------------------------------- As previously reported in the Troubled Company Reporter on October 3, 2005, the Official Committee of Unsecured Creditors filed a complaint against the members of the Board of Directors Integrated Health Services, Inc., in the Court of Chancery of the State of Delaware in New Castle County, entitled "Official Committee of Unsecured Creditors of Integrated Health Services, Inc. v. Robert N. Elkins, et al., C.A. No. 20228-NC," setting forth allegations substantially similar to those asserted in the Bankruptcy Court Action. The Directors have consistently denied liability for all of the claims alleged in the Compensation Action, and certain of the claims asserted in the Complaint against the Directors were dismissed by the Chancery Court in September 2004. Insurance Coverage Dispute Prior to the Petition Date, National Union Fire Insurance Company of Pittsburgh, Pennsylvania, issued to the Debtors Policy No. 858-35-56, a primary policy of Directors, Officers and Corporate Liability Insurance. In connection with the Compensation Action, the Directors made a claim for coverage under the Policy. National Union rejected the coverage claim. Thereafter, the Directors filed a complaint in the Chancery Court entitled "Cirka, et al. v. National Union, C.A. No. 20250-NC," seeking a declaratory judgment that they are entitled to coverage under the Policy for the claims asserted in the Compensation Action. On September 9, 2004, the Chancery Court granted the Debtors' request for partial summary judgment and ruled that the "Insured- vs.-Insured Exclusion," as defined in the Policy was not applicable to bar coverage under the Policy for the claims asserted in the Compensation Action. National Union has filed an appeal in the Delaware Supreme Court, which is presently pending and undecided. Mr. Barry informs the Court that the parties to the Compensation Action and the Coverage Action have reached an agreement to fully settle and compromise their dispute. The Post-Confirmation Committee of Integrated Health Services, Inc., IHS Liquidating LLC, the Directors and National Union stipulate and agree that: (1) National Union will pay $7,500,000 to IHS Liquidating. The Post-Confirmation Committee's outstanding legal fees and expenses will be satisfied from the settlement amount, with the net proceeds paid to IHS Liquidating; (2) National Union will pay certain legal fees and expenses incurred by certain of the Directors' attorneys; (3) IHS Liquidating releases any right to reimbursement of funds by the law firm of Chadbourne & Parke LLP, as a retainer; (4) The Post-Confirmation Committee and the Directors will file a stipulation in the Chancery Court, dismissing the Compensation Action, with prejudice, and without costs to any party; (5) National Union and the Directors will file stipulations dismissing the Coverage Action and the Appeal, with prejudice and without costs to any party; (6) The Stipulation provides for limited releases between IHS Liquidating and the parties to the Compensation Action and the Coverage Action related to the claims and disputes that are the subject of both Actions; and (7) All proofs of claim filed by the Directors in the IHS Debtors' Chapter 11 cases will be deemed withdrawn and expunged, except the administrative expense claim filed by Mr. Elkins. The Court approved the stipulation between Port-Confirmation Committee and IHS Liquidating in its entirety. Integrated Health Services, Inc. -- http://www.ihs-inc.com/-- operated local and regional networks that provide post-acute care from 1,500 locations in 47 states. The Company and its 437 debtor-affiliates filed for chapter 11 protection on February 2, 2000 (Bankr. Del. Case No. 00-00389). Rotech Medical Corporation and its direct and indirect debtor-subsidiaries broke away from IHS and emerged under their own plan of reorganization on March 26, 2002. Abe Briarwood Corp. bought substantially all of IHS' assets in 2003. The Court confirmed IHS' Chapter 11 Plan on May 12, 2003, and that plan took effect September 9, 2003. Michael J. Crames, Esq., Arthur Steinberg, Esq., and Mark D. Rosenberg, Esq., at Kaye, Scholer, Fierman, Hays & Handler, LLP, represent the IHS Debtors. On September 30, 1999, the Debtors listed $3,595,614,000 in consolidated assets and $4,123,876,000 in consolidated debts. (Integrated Health Bankruptcy News, Issue No. 97; Bankruptcy Creditors' Service, Inc., 215/945-7000) INTERSTATE BAKERIES: Gets Court Nod to Hire Jefferson Wells ----------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Missouri gave Interstate Bakeries Corporation and its debtor-affiliates permission to employ Jefferson Wells International, Inc., nunc pro tunc to Sept. 12, 2005. Jefferson Wells will be hired to provide the Debtors with staffing resources to: (a) manage and conduct research for filings with the Securities and Exchange Commission and other financials; (b) perform assessment of current financial reporting state; (c) define the scope and develop a project plan; (d) assist with SEC filings and financial statement reporting efforts; (e) draft external financial reporting documents, including 10-K, 10-Q and footnote disclosures; (f) assist the Debtors on related matters like segment reporting and research of accounting pronouncements and their applicability related to financial reporting as directed by the Debtors' senior management; and (f) assist in the transition of work efforts and results to permanent Debtors' employees. The Debtors' engagement of Jefferson Wells' services is expected to last approximately four to six months. The Debtors will pay Jefferson Wells for its services at these hourly rates: Director $180 Quality Assurance $175 Senior Professional $150 Professional Staff $110 Administrative $50 Jefferson Wells will also receive reimbursement for its reasonable out-of-pocket expenses in connection with its services. James J. Wadella, a managing director at Jefferson Wells, assures the Court that the firm does not have an interest materially adverse to the interest of the Debtors' Chapter 11 estates or of any class of creditors or equity security holders as defined in Section 101(14)(B) or (C) of the Bankruptcy Code. Mr. Wadella further assures the Court that Jefferson Wells will not accept any engagement or perform any service in the Debtors' cases for any entity or person other than the Debtors. However, the firm will continue to provide professional services to entities or persons that may be creditors of the Debtors or potential parties-in-interest in their cases so long as the services do not have any direct connection with the Debtors' cases. 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. 30 Bankruptcy Creditors' Service, Inc., 215/945-7000) INTERSTATE BAKERIES: Can Walk Away from 11 Real Estate Leases ------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Missouri gave Interstate Bakeries Corporation and its debtor-affiliates permission to reject 11 unexpired non-residential real property leases effective as of Aug. 31, 2005, to reduce postpetition administrative costs: Landlord Location Lease Date -------- -------- ---------- Gerard Limited 525 East Palmdale Boulevard, 07/07/1987 Partnership Plaza Del Centro, Palmdale, California Elmer A and Helen 1900 West Main Independence, 08/06/1990 Belt Kansas Meriwether 931 SE Main Street, 05/11/1993 Properties, LLC Wetumpka, Alabama Greenbriar, Ltd. 557 First Street, North 01/01/1991 Alabaster, Alabama Duncan Properties 1001 South Van Buren, Enid, 06/11/1991 Oklahoma Cherry Building, 1720 Cherry Street, Kansas 12/01/1995 LLC City, Missouri T.G.L. Properties, 9,10 & 11 Town & Country 07/08/1997 L.L.C. Marketplace, Warrenton, Missouri Wiltham Place Ltd. 8031 South 83rd Avenue, 02/18/1999 Partnership Lavista, Nebraska SRW Inc. 3201 South Third Street, 05/11/2000 Memphis, Tennessee J.W. Franklin Co. 609 East Young, 09/15/2000 Warrensburg, Missouri Lincoln Henderson 7254 North 30th Street, 11/27/2000 Omaha North 30th Omaha, Nebraska Street LLC 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. 30 Bankruptcy Creditors' Service, Inc., 215/945-7000) IWO HOLDINGS: Sprint Buy-Out Cues S&P to Lift Junk Rating to BBB ---------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on wireless telecommunications carrier IWO Holdings Inc. The corporate credit rating was raised to 'BBB-' from 'CCC+'. The upgrade follows the completion of Sprint Nextel Corp.'s acquisition of IWO for approximately $427 million, including the assumption of about $237 million of debt. "All ratings on IWO are removed from CreditWatch, where they were placed with positive implications on Aug. 30, 2005, following Sprint Nextel's announcement of its agreement to acquire the company; the outlook is stable," said Standard & Poor's credit analyst Eric Geil. IWO provides Sprint PCS services in upstate New York, New Hampshire, Vermont, and portions of Massachusetts and Pennsylvania, serving more than 241,000 direct wireless subscribers. S&P views IWO's operations as a strategic element of the Sprint PCS nationwide network, and therefore impute material support for IWO from Sprint Nextel. However, at 'BBB-', S&P's corporate credit rating on IWO is lower than that on Sprint Nextel because Sprint Nextel might have less incentive to support the IWO operations in the event of financial stress. The view is based on IWO's lack of wireless spectrum licenses, and the longer-term potential for Sprint Nextel to use Nextel network facilities to serve US Unwired markets, given plans to consolidate the Sprint and Nextel networks onto a common technology platform. JAMESTOWN HOUSING: S&P Slices Rating on $2.7M Bonds to B from BB ---------------------------------------------------------------- Standard & Poor's Rating Services lowered its rating on Jamestown Housing Authority, New York's $2.7 million Section 8 assisted mortgage revenue series 1994 bonds to 'B' from 'BB'. The outlook is stable. The downgrade reflects continued decline in debt service coverage to below 1.0x maximum annual debt service, contract rents above fair market rents making the project susceptible to rent freezes, no rental increase since 1995, and increasing annual expenses. The project's debt service coverage has declined continuously over the years. The latest audited financial results for the fiscal year ended Sept. 31, 2004, indicate that the debt service coverage declined to 0.84x MADS, down from 0.86x in 2003. However, the year-to-date financial statements as of July 31, 2005, reflect a slight improvement in debt service coverage. The average rent of $782 per unit per month has remained flat. The project has not received a rental increase since 1995. Expenses per unit per year have increased 1.4% to $5,572 per unit in fiscal 2004, up from $5,492 per unit in fiscal 2003. Increases in expenses can be attributed to an 8% increase in maintenance and repair expenses and a 8% increase utility expenses. Debt per unit was $25,000 as of Jan. 7, 2005. JERRY RUTHERFORD: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtors: Jerry & Alana Rutherford P.O. Box 372 Scottsburg, Indiana 47170 Bankruptcy Case No.: 05-95520 Chapter 11 Petition Date: October 14, 2005 Court: Southern District of Indiana (New Albany) Debtors' Counsel: Neil C. Bordy, Esq. Seiller & Handmaker 462 4th Avenue, Suite 2200 Louisville, Kentucky 40202-3459 Tel: (502) 584-7400 Estimated Assets: $1 Million to $10 Million Estimated Debts: $10 Million to $50 Million Debtors' 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Engineered Conveyors Inc $13,696,455 206 North Main Street Kokomo, IN 46901 Chase Manhattan Bank USA NA $45,843 C/O Academy Collection Service 10965 Decatur Road Philadelphia, PA 19154-3210 MBNA America c/o Mann Braken LLC $28,253 One Paces West 2727 Paces Ferry Rd, Suite 1400 Atlanta, GA 30339 Discover Financial $25,399 Capital One Bank NA $15,890 Household Bank $15,467 Chase Manhattan Bank USA NA $12,028 C/O Professional Recovery Services Direct Merchants $11,811 Beneficial $11,646 Wells Fargo Card Services $11,475 Bank of America $11,005 Chase Manhattan Bank USA NA $10,846 C/O Capital Management Services Citibank South Dakota NA $9,534 AT&T Universal Card $8,078 Steelworkers Platinum Mastercard $6,423 Chase Bank $6,089 Citibank South Dakota NA $6,020 TCM Bank $5,571 MBNA $5,069 Jefferson County Treasurer $5,007 KENNETH MEAD: Case Summary & 13 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Kenneth H. Mead Post Office Box 1090 Ocala, Florida 34478 Bankruptcy Case No.: 05-13930 Chapter 11 Petition Date: October 14, 2005 Court: Middle District of Florida (Jacksonville) Debtor's Counsel: Ronald Bergwerk, Esq. Law Offices of Ronald Bergwerk Post Office Box 17667 Jacksonville, Florida 32245 Tel: (904) 353-1533 Estimated Assets: More than $100 Million Estimated Debts: More than $100 Million Debtor's 13 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ BSB Bank & Trust Co. $1,400,000 c/o Peter Hubbard 500 South Salina St., #500 Syracuse, NY 13202 First American Title Judgment $137,500 c/o W. James Gooding III 7 E. Silver Springs Blvd. #500 Ocala, FL 34470 Tru-Serv Guaranty $98,500 P.O. Box 1510 Butler, PA 16003 New York State Dept. Sales Tax $95,000 of Taxation Financial Federal Judgment $85,000 Bombardier Capital $68,000 Southtrust Bank Loan $59,000 American Express $41,000 Bank of America Guaranty $26,000 Chase Supply Guaranty $25,000 Elbow Farms Guaranty $22,000 Center Capital Corp Guaranty $22,000 Key Bank $9,000 KINGSLEY COACH: Mantyla McReynolds Raises Going Concern Doubt ------------------------------------------------------------- Mantyla McReynolds, LLC, expressed substantial doubt about The Kingsley Coach, Inc.'s ability to continue as a going concern after it audited the Company's financial statements for the fiscal years ended June 30, 2005 and 2004. The auditing firm points to the Company's accumulated losses since inception and negative working capital as of June 30, 2005. Fiscal 2005 Results In its Form 10-KSB submitted to the Securities and Exchange Commission on Oct. 13, 2005, Kingsley Coach reports a $625,174 net loss for fiscal 2005 compared to a $1,559,172 net loss in fiscal 2004. The Company's balance sheet showed $3,184,519 of assets at June 30, 2005, and liabilities totaling $4,965,569, resulting in a $1,781,050 stockholders' deficit. The Company had accumulated deficit of $6,586,937 at June 30, 2005. At June 30, 2005, the Company had a working capital deficit of $1,157,588. Management attributes Kingsley Coach's recurring losses primarily due to the Company's inability to fund production at a profitable rate. Since Jan. 2004, the Company has obtained approximately $1.8 million in new investment capital from the sale of stock, convertible debt and secured debt instruments. The Company utilized these funds to purchase components for the vehicles in its backlog. The new funding allowed the Company to register $2,507,980 in sales during the second half of fiscal 2004. This represented a 128% increase in revenue over the first half of fiscal 2004, and a 57% increase over the second half of fiscal 2003. In fiscal 2005, Kingsley Coach booked $4,838,264 in sales, representing a 34% increase over fiscal 2004. The components of its fiscal 2005 sales were 10 motor homes, 3 commercial vehicles and 2 medical units. Defaults Kingsley Coach is currently in default under contracts with a number of investors. Management has stated that the Company currently has no bank line of credit or other source of bank financing. The Company has declared that it will not be able to meet the Oct. 21, 2005, deadline for the principal and interest payment of its $500,000 secured debt to Longview Equity Fund LP and Longview International Equity Fund LP. In addition, the SEC has not declared effective the prospectus covering resale of the Company's shares into which the Longview debentures are convertible on the Feb. 19 and April 21, 2005 deadlines. Because of this failure, the Company may be required to redeem the Longview notes. Kingsley Coach -- http://www.kingsleycoach.com/-- manufactures motor homes, medical transport vehicles and emergency response vehicles, under the trade name "Kingsley Coach." Although available for a broad variety of uses, each Kingsley Coach has the same structural design. LAIDLAW INT'L: Promotes Four Executives to VP Positions ------------------------------------------------------- Certain senior management employees of Laidlaw International, Inc., and Laidlaw Education Services have been promoted as of July 2005. At Laidlaw International, Douglas A. Carty, formerly Senior Vice President and Chief Financial Officer, and Beth Byster Corvino, formerly Senior Vice President and General Counsel, were both named Executive Vice Presidents of the Corporation. In addition to their primary responsibilities as Chief Financial Officer and General Counsel, they have assumed oversight duties for their respective areas within Education Services. "The appointments of Doug and Beth are an indication of their new responsibilities and reflect the value I place on their experience and advice," Kevin Benson, President and Chief Executive Officer of Laidlaw International, Inc., and President of Laidlaw Education Services, said. At Laidlaw Education Services, John Miller, formerly Vice President and Chief Financial Officer, and James Switzer, formerly Vice President of Canadian Operations, were appointed as Senior Vice Presidents. "There is extensive change underway in many areas of our school bus operations," Mr. Benson indicated. "In the past year, both John and Jim have seen their responsibilities grow as they took on leadership roles in implementing this change. They are key embers of the executive team charged with completing these essential initiatives." About Laidlaw Education Laidlaw Education Services -- http://www.laidlawschoolbus.com/-- a subsidiary of Laidlaw International, Inc., is North America's largest private contractor of student transportation. About Laidlaw Inc. Headquartered in Arlington, Texas, Laidlaw, Inc., now known as Laidlaw International, Inc. -- http://www.laidlaw.com/-- is North America's #1 bus operator. Laidlaw's school buses transport more than 2 million students daily, and its Transit and Tour Services division provides daily city transportation through more than 200 contracts in the US and Canada. Laidlaw filed for chapter 11 protection on June 28, 2001 (Bankr. W.D.N.Y. Case No. 01-14099). Garry M. Graber, Esq., at Hodgson Russ LLP, represents the Debtors. Laidlaw International emerged from bankruptcy on June 23, 2003. (Laidlaw Bankruptcy News, Issue No. 67; Bankruptcy Creditors' Service, Inc., 215/945-7000) * * * As reported in the Troubled Company Reporter on June 6, 2005, Moody's Investors Service has upgraded the ratings of Laidlaw International Inc. senior implied to Ba2 from B1. In a related action, Moody's assigned Ba2 ratings to the company's proposed $300 million Term Loan and $300 million Revolving Credit facility. Moody's said the rating outlook is stable. This completes the ratings review opened on December 22, 2004. LEONARD SIEMASZ: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtors: Leonard J. & Jessica L. Siemasz 14656 Westmore Livonia, Michigan 48154 Bankruptcy Case No.: 05-83742 Chapter 11 Petition Date: October 14, 2005 Court: Eastern District of Michigan (Detroit) Judge: Steven W. Rhodes Debtors' Counsel: Dennis W. Loughlin, Esq. 26300 Northwestern Hiway 4th Floor Post Office Box 5058 Southfield, Michigan 48086-5058 Tel: (248) 357-3010 Total Assets: $284,446 Total Debts: $1,485,373 Debtors' 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Bank One $208,000 P.O. Box 94014 Palatine, IL 60094-4014 LaSalle Bank Corporation $174,000 2600 West Big Beaver Road Troy, MI 48084 Internal Revenue Service $86,190 P.V. McNamara Federal Building 477 Michigan Avenue Detroit, MI 48226-2597 Internal Revenue Service $84,160 Internal Revenue Service $79,159 Internal Revenue Service $77,174 Internal Revenue Service $74,684 Internal Revenue Service $70,410 Internal Revenue Service $68,918 Platinum Plus Guaranteed Corporate $57,500 Credit Card Internal Revenue Service $48,466 Internal Revenue Service $38,022 State of Michigan $34,858 Michigan Dept. of Treasury Internal Revenue Service $31,907 Internal Revenue Service $29,981 Internal Revenue Service $29,600 Citi Financial LOC Guaranteed Corporate $26,500 Credit Card Bank One $25,000 State of Michigan Income Taxes $14,278 Michigan Dept. of Treasury Capital One Guaranteed Corporate $11,500 Credit Card MARGARET HUDNALL: Case Summary & 12 Largest Unsecured Creditors --------------------------------------------------------------- Debtors: Margaret Perkins & James K. Hudnall 6534 Wendy Drive Pineville, Louisiana 71360 Bankruptcy Case No.: 05-82837 Chapter 11 Petition Date: October 16, 2005 Court: Western District of Louisiana (Alexandria) Debtors' Counsel: Bradley L. Drell, Esq. Gold, Weems, Bruser, Sues & Rundell 2001 MacArthur Drive, P.O. Box 6118 Alexandria, Louisiana 71307-6118 Tel: (318) 445-6471 Estimated Assets: $500,000 to $1 Million Estimated Debts: $1 Million to $10 Million Debtors' 12 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ People's State Bank $1,385,366 880 San Antonio Avenue Many, LA 71449 Hibernia Bank $858,683 P.O. Box 61540 New Orleans, LA 70161 Delta Bank of Ferriday $775,000 P.O. Box 391 Ferriday, LA 71334 Scott Construction Equipment $45,882 Co. American Express $19,000 Land Rover Capital Group Value of Security: $15,049 $30,000 Land Rover Capital Group Value of Security: $12,000 $30,000 Discover Card $10,700 Internal Revenue Service $10,000 Louisiana Dept. of Revenue & $10,000 Tax Jaguar Credit Value of Security: $4,489 $14,000 Haverty's Furniture $1,982 MERIDIAN AUTOMOTIVE: Panel Can Hire Bifferato as Conflicts Counsel ------------------------------------------------------------------ The Honorable Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware gave the Official Committee of Unsecured Creditors appointed in Meridian Automotive Systems, Inc., and its debtor-affiliates' chapter 11 cases, permission to retain Bifferato, Gentilotti, Biden & Balick, P.A., as its special conflicts counsel, effective as of Aug. 26, 2005. As previously reported in the Troubled Company Reporter on Sept. 12, 2005, Bifferato will handle the Adversary Proceeding filed by the Committee against the First Lien Lenders and Second Lien Lenders to invalidate their liens. Ashby & Geddes, P.A., the Committee's local counsel, is unable to represent the Committee in the Adversary Proceeding on account of some conflicts of interest. Gregory A. Taylor, Esq., at Ashby & Geddes, P.A., in Wilmington, Delaware, tells the Court that Bifferato's services will be limited to the causes of action asserted by the Committee against the defendants in the Adversary Proceeding. Bifferato will be paid in accordance with the firm's ordinary and customary hourly rates: Professional Position Rate ------------ --------- ---- Ian Connor Bifferato Director $325 David W. deBruin Associate $265 Joseph K. Koury Associate $225 Garvan F. McDaniel Associate $225 Jennifer M. Randolph Paralegal $115 Jennifer J. Harris Paralegal $115 Headquartered in Dearborn, Mich., Meridian Automotive Systems, Inc. -- http://www.meridianautosystems.com/-- supplies technologically advanced front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers. Meridian operates 22 plants in the United States, Canada and Mexico, supplying Original Equipment Manufacturers and major Tier One parts suppliers. The Company and its debtor-affiliates filed for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168 through 05-11176). James F. Conlan, Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $530 million in total assets and approximately $815 million in total liabilities. (Meridian Bankruptcy News, Issue No. 16; Bankruptcy Creditors' Service, Inc., 215/945-7000). MERIDIAN AUTOMOTIVE: Credit Suisse Wants Jury Trial to Fix Claims ----------------------------------------------------------------- As previously reported in the Troubled Company Reporter on Sept. 9, 2005, the Official Committee of Unsecured Creditors, on Meridian Automotive Systems, Inc., and its debtor-affiliates' behalf, wants to avoid certain liens and claims of the First Lien Lenders and Second Lien Lenders. Credit Suisse Responds Dennis A. Meloro, Esq., at Greenberg Traurig, LLP, in Wilmington, Delaware, relates that in connection with the sale of Meridian Automotive Systems-Composites Operations, Inc.'s facility in Centralia, Illinois, in October 2004, the Debtors hired First American Title Company to act as its escrow agent. Mr. Meloro points out that under the terms of the First Lien Credit Agreement and the Second Lien Credit Agreement, the Debtors did not need the consent of Credit Suisse, Cayman Islands Branch, as agent under the Credit Agreements, to consummate the Centralia Sale. The Debtors, however, requested that Credit Suisse release its liens on the property being sold. As a result of the Debtors' request, Credit Suisse sent to First American, among other things: (i) the CSFB First October UCC Statement amending the CSFB First April UCC Statement; and (ii) a UCC-3 statement amending the UCC-1 financing statement that was filed simultaneously with the CSFB First April UCC Statement. The CSFB First October UCC Statement was sent to First American with explicit authorization to include the date of the closing of the Centralia Sale and to file the CSFB First October UCC Statement. First American, however, did not file the CSFB First October UCC Statement. Instead, First American manually changed it to reflect that it was both a termination and an amendment, before filing it with the Delaware Secretary of State. At substantially the same time, First American also manually altered the CSFB Second October UCC Statement in the same way it altered the CSFB First October UCC Statement. This time, First American removed the marking that the UCC was a termination before filing it. First American also filed a UCC-3 statement amending the financing statement filed on behalf of U.S. Bank National Association, as Collateral Agent. This UCC Statement, Mr. Meloro points out, was also manually altered in the same way the CSFB October UCC Statements were, and reflected and amendment only. "Despite the fact that First American had altered all three October UCC Statements, First American fixed only the CSFB Second October UCC Statement and the Third October UCC Statement, but never fixed the Flawed First October UCC Statement. Upon recognizing that First American had filed the Flawed First October UCC Statement without authorization, Credit Suisse filed a UCC-3 financing statement and a UCC-1 financing statement with the Delaware Secretary of State on April 21, 2005. Credit Suisse asserts that since First American was not its agent, it did not have any authority to alter and file the CSFB October UCC Statements. Accordingly, Credit Suisse, in its capacity as Administrative Agent and Collateral Agent under the First Lien Credit Agreement, asks the Court to dismiss the complaint filed by the Official Committee of Unsecured Creditors and the Debtors, which seeks to avoid certain liens and claims of the First Lien Lenders and the Second Lien Lenders, because: (a) the Complaint does not state facts sufficient to constitute a cause of action against Credit Suisse; (b) the Plaintiffs are barred as against Credit Suisse by the equitable doctrine of "unclean hands"; (c) the transfers referenced in the Complaint, if and to the extent made, are not recoverable by the Plaintiffs as voidable preferences because they were made for debts incurred by the Debtors in the ordinary course of their business with Credit Suisse; (d) Plaintiffs are barred from recovery, in whole or in part, because Credit Suisse is not bound by the unauthorized acts of the Debtors' agent, and therefore the CSFB First April UCC Statement is still fully and properly perfected and effective; (e) Plaintiffs are barred from recovery, in whole or in part, because the Flawed October UCC Statement was not authorized by Credit Suisse; (f) Plaintiffs are barred from recovery, in whole or in part, because the Flawed October UCC Statement, by being inconsistent and ambiguous on its face, is not effective under Delaware law; (g) Plaintiffs are barred from recovery, in whole or in part, because as of the date the April 2005 UCC Statement was filed and as of the Petition Date, Credit Suisse was fully secured by properly perfected security interests in assets of the Debtors other than those subject to the April 2005 UCC Statement; (h) Plaintiffs are barred from recovery, in whole or in part, because Credit Suisse was fully secured by properly perfected security interests in all assets of the Debtors; (i) Plaintiffs are barred from recovery, in whole or in part, because the April 2005 UCC Statement is not a preference because: -- it was not a transfer of the Debtors' property; -- it was not made while the Debtors were insolvent; and -- it did not enable Credit Suisse to receive more than it would have received under Chapter 7 of the Bankruptcy Code absent the filing; (j) Plaintiffs are barred from recovery, in whole or in part, because First American knew or should have known that it had no authority to: -- act on behalf of Credit Suisse; -- change the CSFB First October UCC Statement; and -- file the Flawed October UCC Statement; and (k) Plaintiffs are barred from profiting as a result of First American's negligent or intentional misconduct. Mr. Meloro clarifies that Credit Suisse is not answering the Complaint, or any of its allegations, in its capacity as agent under the Second Lien Credit Agreement, or on behalf of itself or any other lender as lender under the First Lien Credit Agreement or the Second Lien Credit Agreement. Credit Suisse explicitly reserves all of its rights related to these Agreements. Credit Suisse Asks for Jury Trial Credit Suisse tells Judge Walrath that First American failed to follow its explicit instructions and: (1) was negligent in changing the CSFB First October UCC Statement into the Flawed First October UCC Statement; and (2) exercised unauthorized dominion and control over Credit Suisse's property, of which Credit Suisse has a superior possessory right. In the event that the Court finds that Credit Suisse does not have a first priority lien on Meridian Composites' assets on account of First American's filing of the Flawed First October UCC Statement, Credit Suisse asserts that First American's breach of its duty will have been the proximate cause of the damage. For these reasons, Credit Suisse insists that it is entitled to damages, and demands a jury trial to determine the amount of its claim. Headquartered in Dearborn, Mich., Meridian Automotive Systems, Inc. -- http://www.meridianautosystems.com/-- supplies technologically advanced front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers. Meridian operates 22 plants in the United States, Canada and Mexico, supplying Original Equipment Manufacturers and major Tier One parts suppliers. The Company and its debtor-affiliates filed for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168 through 05-11176). James F. Conlan, Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $530 million in total assets and approximately $815 million in total liabilities. (Meridian Bankruptcy News, Issue No. 16; Bankruptcy Creditors' Service, Inc., 215/945-7000). METALFORMING TECH: Wants Exclusive Period Stretched to Feb. 11 -------------------------------------------------------------- Metalforming Technologies, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to extend until Feb. 11, 2006, the time within which they can have the exclusive right to file a chapter 11 plan. The Debtors also want their exclusive right to solicit plan acceptances extended through Apr. 12, 2006. The Debtors cite four reasons in support of their request: (1) the chapter 11 case is large and complex; (2) the Debtors have not been dilatory in these cases; (3) the Committee and Lenders have been, and will continue to be, involved in all aspects of these chapter 11 cases; and (4) the Debtors are paying their ongoing expenses as they become due. Headquartered in Chicago, Illinois, Metalforming Technologies, Inc., and its debtor-affiliates manufacture seating components, stamped and welded powertrain components, closure systems, airbag housings and charge air tubing assemblies for automobiles and light trucks. The Company and eight of its affiliates, filed for chapter 11 protection on June 16, 2005 (Bankr. D. Del. Case Nos. 05-11697 through 05-11705). Joel A. Waite, Esq., Robert S. Brady, Esq., and Sean Matthew Beach, Esq., at Young Conaway Stargatt & Taylor, represent the Debtors in their restructuring efforts. As of May 1, 2005, the Debtors reported $108 million in total assets and $111 million in total debts. METALFORMING TECH: Has Until Dec. 13 to Remove Civil Actions ------------------------------------------------------------ (Jason) The Honorable Judge Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware, extended until Dec. 13, 2005, Metalforming and its debtor-affiliates' time within which they may remove prepetition civil actions. The Debtors tell the Court that the extension sought will afford them additional time to make fully informed decision concerning removal of each pending pre-petition civil action and at the same assure that the Debtors' rights are not forfeited. Headquartered in Chicago, Illinois, Metalforming Technologies, Inc., and its debtor-affiliates manufacture seating components, stamped and welded powertrain components, closure systems, airbag housings and charge air tubing assemblies for automobiles and light trucks. The Company and eight of its affiliates, filed for chapter 11 protection on June 16, 2005 (Bankr. D. Del. Case Nos. 05-11697 through 05-11705). Joel A. Waite, Esq., Robert S. Brady, Esq., and Sean Matthew Beach, Esq., at Young Conaway Stargatt & Taylor, represent the Debtors in their restructuring efforts. As of May 1, 2005, the Debtors reported $108 million in total assets and $111 million in total debts. MICHAEL PERSON: Case Summary & Largest Unsecured Creditor --------------------------------------------------------- Debtors: Michael S. Person & Elizabeth S. Person 805 Robert E. Lee Drive Greenwood, Mississippi 38930 Bankruptcy Case No.: 05-19194 Chapter 11 Petition Date: October 14, 2005 Court: Northern District of Mississippi (Aberdeen) Judge: David W. Houston III Debtors' Counsel: Jeffrey A. Levingston, Esq. Levingston & Levingston, PA P.O. Box 1327 Cleveland, Mississippi 38732 Tel: (662) 843-2791 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtors' Largest Unsecured Creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Planters Bank Loan $12,967 POB 1350 Greenwood, MS 38955-1350 MICHAEL SEBASTIAN: Case Summary & 17 Largest Unsecured Creditors ---------------------------------------------------------------- Debtors: Michael David & Mary Elinor Sebastian 10625 Lakeshore Drive West Olive, Michigan 49460 Bankruptcy Case No.: 05-20932 Chapter 11 Petition Date: October 16, 2005 Court: Western District of Michigan (Great Rapids) Judge: James D. Gregg Debtors' Counsel: Thomas P. Sarb, Esq. Miller, Johnson, Snell & Cummiskey 250 Monroe Avenue, N.W., Suite 800 Post Office Box 306 Great Rapids, Michigan 49501 Tel: (616) 831-1700 Fax: (616) 831-1701 Estimated Assets: $500,000 to $1 Million Estimated Debts: $1 Million to $10 Million Debtors' 17 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Julius Duthler $258,000 2025 North Cross Creek Drive, Southeast Grand Rapids, MI 49508 Michael Knapp, Sr. $258,000 The Knapp Law Firm 310 Washington, Southeast Grand Rapids, MI 49503 Chase Visa $29,332 PO Box 15298 Wilmington, DE 19850 Fifth Third Bank $24,996 MBNA Mastercard $20,796 Bank One/United Mileage Plus $12,271 Mike Knapp, Jr. $12,000 Chase Mastercard $9,674 Discover Card $9,444 Mainstream Enterprises $8,897 Kitchen Design Studio, Inc. $7,837 Jerry Jurewicz $5,702 Dalstra Roofing, Inc. $2,807 BP/Amoco $126 Accurate Construction Unknown Comerica Bank Unknown Choice One Bank Unknown MICHAEL WILEY: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtors: Michael Junious & Yvonne Maria Wiley 13901 Wolcott Drive Tampa, Florida 33624 Bankruptcy Case No.: 05-25506 Chapter 11 Petition Date: October 13, 2005 Court: Middle District of Florida (Tampa) Debtors' Counsel: Susan H. Sharp, Esq. Stichter, Riedel, Blain & Prosser 110 East Madison Street, Suite 200 Tel: (813) 229-0144 Fax: (813) 229-1811 Estimated Assets: $500,000 to $1 Million Estimated Debts: $1 Million to $10 Million The Debtors did not file a list of their 20 Largest Unsecured Creditors. MORAN MATERIALS: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Moran Materials Recycling, Inc. 60 Ram Drive Hanover, Pennsylvania 17331 Bankruptcy Case No.: 05-07446 Chapter 11 Petition Date: October 9, 2005 Court: Middle District of Pennsylvania (Harrisburg) Judge: Mary D. France Debtor's Counsel: John J. Martin, Esq. Law Offices John J. Martin 1022 Court Street Honesdale, Pennsylvania 18431 Tel: (570) 253-6899 Fax: (570) 253-6988 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Nathan Adler Lease Default $428,242 c/o Nathan D. Adler, Esq. Neuberger, Quinn, Rubin & Gibber, PA 27th Floor, One South Street Baltimore, MD 21202 Donetsk State Scientific Materials Supplied $306,873 Research Institute c/o Charles L. Simmons, Jr. Gorman & Williams, PC Two North Charles Street, Suite 750 Baltimore, MD 21201 South Jersey Energy Company Electrical Utilities $133,661 P.O. Box 150 West Berlin, NJ 08091 PSE&G Gas Utility $46,190 MINALCO Trade Debt $35,067 Sylva Aluminum Castings Inc. Materials $31,775 Maryland Recycle Company, Inc. Materials $17,365 Aaron Ferer & Sons Trade Debt $13,726 Texas Liquids Trade Debt $13,725 Metro Truck Leasing Lease Default $13,694 Comdata Network Inc. Trade Debt $6,847 Gene Hendifar Returned Check $6,393 Swopes Salvage Trade Debt $5,717 Old Dominion Freight Line Freight Services $4,986 Eastern Lift Trade Debt $4,399 Nulls Machine Mfg. Trade Debt $4,159 Freightquote.com $2,860 Universal Packaging Trade Debt $2,691 Deringer Trade Debt $2,375 Sprint PCS Telephone Utility $2,180 NORTHWEST AIRLINES: East Texas Lobbies for Equity Committee ----------------------------------------------------------- East Texas Capital Partners, LLC, on behalf of its principals who own Northwest Airlines Corporation common stock (OTC Bulletin Board: NWACQ) want the U.S. Trustee to appoint an Official Equity Securities Committee in Northwest Airlines Corporation and its debtor-affiliates' chapter 11 proceedings to represent the Company's common stockholders' interests in the Debtors' bankruptcy cases. ETCP, LLC, believes that NWA's bankruptcy is, at best, technical and opportunistic in nature, apparently solely motivated by NWA's desire to speed concession talks with its unions and modify certain company financial arrangements. ETCP, LLC, believes that NWA's bankruptcy filing was unnecessary as the company had: -- $1.5 billion in unrestricted cash on hand at the time of filing, more than any major airline (e.g. US Airways, Delta Airlines) at the time of their filing; -- labor concessions pending from over half its unionized work force at the time; and -- pension law reform favorable to NWA also moving through the U.S. Congress at the time of filing. Furthermore, it is ETCP, LLC's belief that the true asset value of the bankruptcy estate appears understated as NWA's filing does not account for the company's valuable route structure, the future tax savings from the accumulated net operating losses in any reorganized entity and other valuable assets. ETCP believes there are recoveries unique to the common stockholders' that will be available should it be proven, as ETCP, LLC suspects, that NWA's board of directors acted inappropriately by failing to discharge their duties to shareholders by acting specifically contrary to their interests, by its members failing to properly file legally required Securities and Exchange Commission paperwork on a timely basis and other failures of disclosure. ETCP on behalf of its share-owning principals, filed a complaint with the SEC alleging: -- NWA's general pattern of non-disclosure; -- Mr. Gary Wilson's reporting irregularities regarding his recent stock sales; and -- improper public information regarding a forcibly resigned board member the day before the bankruptcy vote, V. A. Ravindran, still being listed as a director as of Sept. 30, 2005, almost three weeks later. An example of NWA's poor disclosure is how the maintenance and mechanical problems at NWA, well documented by the Federal Aviation Administration and independent experts and journalists, have been inaccurately described by the company as everything "running smoothly." ETCP privately estimates that, under certain scenarios apart from potential shareholder specific damage claims, Northwest Airlines' common stockholders could be entitled to as much as $250 million or almost $3 per common share in recovery in any reorganization. The appointment of a Formal Equity Securities committee will assure that common stockholders have a chance of this recovery and, by its oversight in the bankruptcy process, will limit what appears to be an unchecked pattern of disregard for the common stockholders, the actual business owners of NWA, by NWA's Board of Directors to date. ETCP believes that the appointment of an Equity Securities Committee will not interfere with any future Unsecured Creditor Committee activities and will speed NWA's reorganization process by giving an organized voice to the stockholders' interests in the case. Northwest Airlines Corporation -- http://www.nwa.com/-- is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and approximately 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 900 cities in excess of 160 countries on six continents. The Company and 12 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05- 17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $14.4 billion in total assets and $17.9 billion in total debts. NOVA CHEMICALS: S&P Rates $300 Mil Senior Unsecured Notes at BB+ ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB+' long-term corporate credit and senior unsecured debt ratings on Nova Chemicals Corp. At the same time, Standard & Poor's revised its outlook on the company to negative from stable. The revised outlook reflects poorer-than-expected performance from its styrenics division and consequent concerns that Nova's full cycle operating performance might lag the levels expected at the 'BB+' rating level. At the same time, Standard & Poor's assigned its 'BB+' senior unsecured debt rating to Nova's proposed US$300 million senior floating-rate note issue. The ratings on Calgary, Alberta-based Nova reflect the cyclicality and commodity-like nature of the company's petrochemical products, the good returns and cost profile for its olefins division, the poor operating results from its styrenics division, and its high leverage. Nova's primary petrochemical segments are highly cyclical and operating margins tend to trend in the same direction, thereby limiting the benefits of diversification because both product chains consume energy-related raw materials, and demand is linked to economic activity. "The ethylene/polyethylene segment benefits from a strong cost profile relative to most North American producers due to access to competitive feedstocks at Nova's Alberta-based facilities," said Standard & Poor's credit analyst Kenton Freitag. "Nevertheless, the styrenics division has a below-average operating cost profile and is subject to higher levels of global competition," Mr. Freitag added. Profitability in the styrenics chain has been hampered by large-scale capacity additions around the world, some of which relate to the development of propylene oxide facilities. These facilities often use technology that produces styrene as a co-product. These poor industry fundamentals and Nova's high cost position have resulted in persistently negative EBITDA generation in the past several years. Although Nova has taken a number of measures to reduce costs and introduce higher margin products, it is unclear whether these efforts will be successful in neutralizing the drag it has caused on the company's overall financial performance. The outlook is negative. Although S&P expects credit measures to improve in the very near term, it is unclear that the company's full cycle performance will be sufficiently strong to justify the current rating. The adoption of more aggressive financial policies or a lack of improvement in operating results, particularly in its styrenics division, could lead to a modest downgrade. Conversely, indications of a material improvement in the operating performance of its styrenics division or a sustained period of solid performance by its olefins division could result in the outlook being revised to stable. O'SULLIVAN INDUSTRIES: Gets Court Nod to Keep Investing Funds ------------------------------------------------------------- For deposits or investments that are not insured or guaranteed by the United States or any of its department, agency or instrumentality, Section 345(b) of the Bankruptcy Code provides that, unless the debtor shows cause for a waiver, it must obtain from the entity with which funds are deposited or invested a bond in favor of the United States secured by an undertaking of an approved corporate surety. James C. Cifelli, Esq., at Lamberth, Cifelli, Stokes & Stout, P.A., in Atlanta, Georgia, asserts that cause exists for allowing O'Sullivan Industries Holdings, Inc. and its debtor-affiliates to invest their excess cash in accordance with their existing investment policies, without meeting the strict bond requirements of Section 345(b). "The Debtors do not have any significant long-term investments," Mr. Cifelli attests. In accordance with the recent amendments to their Credit Agreement with General Electric Capital Corporation, the Debtors transfer to GECC any amounts in their Operating Account, the Disbursement Account, and the Canadian Account exceeding $600,000 in the aggregate, Mr. Cifelli explains. The Lockbox Account and the Debtors' other bank accounts maintain a relatively low balance or are swept frequently. "Most of the Debtors' bank accounts are not even interest- bearing," Mr. Cifelli says. "Indeed, the Debtors' investments bear interest at rates of no more than 3.5%." However, Mr. Cifelli relates, to the limited extent the Debtors keep cash in any particular interest-bearing bank account or other investment for any extended period of time, the cash is invested conservatively, with the primary goal of protecting the principal. Mr. Cifelli ascertains that the banks the Debtors use are all well established and invest the Debtors' funds in accordance with their standard investment guidelines. Absent a waiver of the Section 345(b) bond requirements, the Debtors believe that they could be required to request that certain of their banks post bonds secured by the undertaking of a corporate surety. They further believe that the bonds likely would be unduly expensive and could damage their relationships with their banks, which may not fully understand the reasons for their request. Moreover, the Debtors note that they could be required to open new accounts and take other measures at great administrative cost, delay, and distraction, which would not be inconsistent with the purposes of Section 345(b). Accordingly, the Debtors sought and obtained the U.S. Bankruptcy Court for the Northern District of Georgia's authority to continue investing funds in accordance with their existing investment policies without obtaining bonds from their banks under Section 345(b). Headquartered in Roswell, Georgia, O'Sullivan Industries Holdings, Inc. -- http://www.osullivan.com/-- designs, manufactures, and distributes ready-to-assemble furniture and related products, including desks, computer work centers, bookcases, filing cabinets, home entertainment centers, commercial furniture, garage storage units, television, audio, and night stands, dressers, and bedroom pieces. O'Sullivan sells its products primarily to large retailers including OfficeMax, Lowe's, Wal-Mart, Staples, and Office Depot. The Company and its subsidiaries filed for chapter 11 protection on October 14, 2005 (Bankr. N.D. Ga. Case No. 05- 83049). On September 30, 2005, the Debtor listed $161,335,000 in assets and $254,178,000 in debts. (O'Sullivan Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 215/945-7000) O'SULLIVAN INDUSTRIES: Can Continue Using Existing Business Forms ----------------------------------------------------------------- O'Sullivan Industries Holdings, Inc. and its debtor-affiliates sought and obtained waiver of the United States Trustee's operating guidelines that require Chapter 11 debtors to obtain business forms, including checks, that bear the designation "debtor-in-possession," the bankruptcy case number, and the type of account for each debtor-in-possession account. The U.S. Bankruptcy Court for the Northern District of Georgia authorizes the Debtors to continue utilizing their existing business forms, including checks. The U.S. Trustee requirement is designed to provide a clear line of demarcation between prepetition and postpetition transactions and operations, and to prevent the inadvertent postpetition payment of prepetition claims through the payment of checks drawn prior to the filing of a bankruptcy petition. However, James C. Cifelli, Esq., at Lamberth, Cifelli, Stokes & Stout, P.A., in Atlanta, Georgia, asserts that a substantial amount of time and expense would be required to print new business forms and stationery and would also likely result in a substantial risk of disruption to their ordinary business affairs. The risk in particular could easily interrupt the payment of wages and salaries and payment for necessary supplies and could substantially disrupt the Debtors' relationships with their labor force, customers and suppliers, Mr. Cifelli explains. Headquartered in Roswell, Georgia, O'Sullivan Industries Holdings, Inc. -- http://www.osullivan.com/-- designs, manufactures, and distributes ready-to-assemble furniture and related products, including desks, computer work centers, bookcases, filing cabinets, home entertainment centers, commercial furniture, garage storage units, television, audio, and night stands, dressers, and bedroom pieces. O'Sullivan sells its products primarily to large retailers including OfficeMax, Lowe's, Wal-Mart, Staples, and Office Depot. The Company and its subsidiaries filed for chapter 11 protection on October 14, 2005 (Bankr. N.D. Ga. Case No. 05- 83049). On September 30, 2005, the Debtor listed $161,335,000 in assets and $254,178,000 in debts. (O'Sullivan Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 215/945-7000) ORGANIZED LIVING: Court Sets Nov. 15 Bar Date for Gift Card Claims ------------------------------------------------------------------ The Honorable Charles M. Caldwell of the U.S. Bankruptcy Court for the Southern District of Ohio, established 4:00 p.m. on Nov. 15, 2005, as the deadline for all holders of claims on account of gift certificates or gift cards issued but unhonored prior to May 4, 2005, against Organized Living, Inc., to file proofs of claim. Judge Caldwell also set the same deadline for all unknown creditors of the Debtor to file their proofs of claim. Gift card claims holders and unknown creditors must file written proofs of claim on or before the Nov. 15 Supplemental Bar Date and those forms must be sent to: United States Bankruptcy Court 170 North High Street, Columbus, OH 43215 Headquartered in Westerville, Ohio, Organized Living, Inc., -- http://www.organizedliving.com/-- is an innovative retailer of storage and organization products for the home and office with stores throughout the U.S. The Company filed for chapter 11 protection on May 4, 2005 (Bankr. S.D. Ohio Case No. 05-57620). Tim Robinson, Esq., at Squire Sanders & Dempsey, represents the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it estimated assets and debts of $10 million to $50 million. OSWALD BURRELL: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Oswald B. Burrell 11-13 Dracut Street Boston, Massachusetts 02124 Bankruptcy Case No.: 05-21437 Chapter 11 Petition Date: October 12, 2005 Court: District of Massachusetts (Boston) Judge: Robert Somma Debtor's Counsel: Robert F. Creasia, Esq. Law Office of Robert F. Creasia 3 Fayette Street Milford, Massachusetts 01757 Tel: (508) 473-4448 Fax: (508) 634-1230 Estimated Assets: $1 Million to $10 Million Estimated Debts: $500,000 to $1 Million The Debtor did not file a list of its 20 Largest Unsecured Creditors. PC LANDING: Judge Walsh Approves Disclosure Statement Supplement ---------------------------------------------------------------- The Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware approved PC Landing Corporation and its debtor-affiliates' Supplemental Disclosure of Plan Modifications. Judge Walsh determined that the Disclosure Supplement, together with the approved Disclosure Statement, contains adequate information -- the right amount of the right kind for creditors to make informed decisions when the Debtor asks them to vote to accept the Plan. As reported in the Troubled Company Reporter on July 19, 2005, the Court approved the Debtor and its debtor-affiliates' Disclosure Statement explaining the Debtors' First Amended Joint Plan of Reorganization. The Plan Under the terms of the Plan, secured lenders will receive $25 million of new 7% senior secured debt. The remaining $634 million deficiency claim will be satisfied by a pro rata distribution of New Common Stock in the Reorganized Debtors. The Plan's treatment of the secured lenders' claims allows for significant recoveries for unsecured creditors and provides enough cash for the Reorganized Debtors to successfully commence operations after emergence from bankruptcy. General unsecured creditors will receive pro rata shares of the New Common Stock. Intercompany claims and existing equity interests will be cancelled on the Effective Date. The Debtors remind the Court that certain provisions of the Plan are impacted by the U.S. Government Recommended Settlement and the Tyco Settlement. Among other things, the Debtors say, the Plan has been amended to add the expected execution and delivery of the Tyco Settlement Agreement, and the U.S. Government Settlement Agreement prior to Confirmation and to modify certain provisions of the New Senior Secured Note to reflect future issuance of the Tyco note in connection with the Remediation work to be performed under the Tyco Settlement. The Debtors also say that to prevent ambiguity with respect to the treatment of regulatory obligations, the Plan has also been modified to specify the treatment of the Governmental Authorizations and Related Agreements. In addition, the Debtors further say, the Plan has been modified to provide flexibility in connection with the Debtors' corporate structure and governance. Plan Modifications Specifically, the Debtors disclose, the modifications of the Plan are: 1. Updated Definitions: The Second Amended Plan adds additional definitions as necessary to accommodate the modifications and conform or update other definitions. 2. Treatment of Class 3 Secured Claims: The Second Amended Plan provides the Debtors with the option of paying Class 3 Secured Claims over time, provided that the Holder of such Class 3 Claim retains its Lien. 3. Incorporation of Settlements with the U.S. Government & Tyco: The Second Amended Plan incorporates the settlements reached with the U.S. Government and Tyco. The Debtors say that separate motions to approve these settlements will be filed with the Court and parties in interest will have an opportunity to object to the settlement themselves. The settlements provide for, among other things: (a) resolution of the regulatory compliance issues with the U.S. Government Entities and a protocol for the reburial of certain portions of the PC-1 cable that reside within the Olympic Coast National Marine Sanctuary and a sharing of the costs of such reburial between Tyco and the Debtors in accordance with the Tyco Settlement; (b) restructuring of the Debtors; future monitoring obligations under its Special use Permit with the National Oceaninc and Atmospheric Administration; (c) resolution of the Claims filed by the U.S. Government entities; (d) disallowance of Tyco's Claims; (e) resolution of all title disputes with Tyco such that the Debtors have title to PC-1, including all system upgrades; (f) significance of Class 2 Secured Creditors, the Tyco Settlement provides for the issuance of the Tyco Note; and (g) commercial arrangement with Tyco that are beneficial to the Debtors' post-confirmation operations. 4. Treatment of Governmental Authorizations and Related Agreements: The Second Amended Plans sets forth in detail the treatment of each Governmental Authorizations and Related Agreements. 5. Plan Implementation: The Second Amended Plan provides that to the extent necessary for business, regulatory, tax or other corporate purposes and provided that it does not alter the obligations to Creditors or other parties in interest under the Plan, the Debtors may create or dissolve one or more subsidiaries, or may modify the form of corporate governance as necessary or appropriate in the business judgment of the Debtors. The Debtors say that in light of the multi-national jurisdictions governing the Debtors, they require flexibility in the treatment of class 6 intercompany Claims. The Debtors remind the Court that on the petition date, certain of the Debtors were creditors of other Debtors. Because the notes reflecting theses obligations were either pledge to or subordinated to the Prepetition Secured Lenders' Claims, and in light of the treatment proposed in the Second Amended Plan, the Plan proposes "zeroing out" these Claims. The Debtors say that this treatment of intercompany claims should have no economic impact on any creditor. However, the Debtors disclose, in order to comply with corporate requirements in Japan, the United Kingdom and Bermuda and to minimize any adverse tax consequences to the Debtors, they may need to effect this "zeroing out" by way of one or more intermediate transactions. Headquartered in Dallas, Texas, PC Landing Corporation and its debtor-affiliates, own and operate one of only two major trans- Pacific fiber optic cable systems with available capacity linking Japan and the United States. The Debtor filed for chapter 11 protection on July 19, 2002 (Bankr. Del. Case No. 02-12086). Laura Davis Jones, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub, P.C., represents the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they estimated assets of more than $100 million. PC LANDING: Wants Exclusive Period Stretched to December 18 ----------------------------------------------------------- PC Landing Corp. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to extend until Dec. 18, 2005, the time within which they can have the exclusive right to file a chapter 11 plan. The Debtors also want their exclusive right to solicit plan acceptances extended through Mar. 3, 2006. As reported in the Troubled Company Reporter on June 30, 2005, the Court extended until Dec. 2, 2005, the Debtor and its debtor- affiliates' exclusive plan solicitation period. As reported in the Troubled Company Reporter on July 19, 2005, the Court approved the Debtor and its debtor-affiliates' Disclosure Statement explaining the Debtors' First Amended Joint Plan of Reorganization. The Debtors tell that Court that they are currently negotiating with various state and federal agencies and third parties in connection with certain issues that will affect their ability to confirm a plan of reorganization. The Debtors further tell the Court that they are optimistic and believe the Plan will likely be confirmed on Nov. 10, 2005. The Debtors disclose that should unforeseen circumstances arise and confirmation does not take place on Nov. 10, 2005, they will require additional time. The Debtors, in an abundance of caution, seek to further extend their exclusive filing period and exclusive solicitation period. The Debtors say that they are not seeking the extension in order to delay administration of the chapter 11 cases or to pressure creditors to accept unsatisfactory plans. On the contrary, the Debtor say, they ask for the extension to facilitate and orderly, efficient and cost-effective plan process for the benefit of all creditors. Headquartered in Dallas, Texas, PC Landing Corporation and its debtor-affiliates, own and operate one of only two major trans- Pacific fiber optic cable systems with available capacity linking Japan and the United States. The Debtor filed for chapter 11 protection on July 19, 2002 (Bankr. Del. Case No. 02-12086). Laura Davis Jones, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub, P.C., represents the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they estimated assets of more than $100 million. PETROKAZAKHSTAN INC: Gets Securityholders' Nod on CNPC Buy-Out -------------------------------------------------------------- PetroKazakhstan Inc.'s securityholders approved the proposed plan of arrangement pursuant to which a subsidiary of CNPC International Ltd. will acquire all of the issued and outstanding common shares of PetroKazakhstan for US$55.00 cash per share. The transaction was approved by over 99% of the votes cast by securityholders voting at the meeting. PetroKazakhstan also appeared before the Court of Queen's Bench of Alberta to seek the granting of a final order approving the arrangement. As previously announced, Lukoil Overseas Kukol B.V. appeared at the hearing opposing approval of the arrangement. The Court heard oral submissions from counsel to PetroKazakhstan, CNPC International, certain shareholders and Lukoil. The Court reserved its decision as to whether to grant the final order until October 26, 2005. If the Court grants the final order on October 26, 2005, and subject to the satisfaction of the other conditions contained in the Arrangement Agreement between PetroKazakhstan and CNPC International, PetroKazakhstan would file articles of arrangement to give effect to the arrangement on October 26 or 27, 2005, depending on the time at which the final order of the Court is rendered on October 26. PetroKazakhstan Inc. -- http://www.petrokazakhstan.com/-- is a vertically integrated, international energy company, celebrating its eighth year of operations in the Republic of Kazakhstan. PetroKazakhstan is engaged in the acquisition, exploration, development and production of oil and gas, the refining of crude oil and the sale of oil and refined products. PetroKazakhstan shares trade in the United States on the New York Stock Exchange, in Canada on The Toronto Stock Exchange, in the United Kingdom on the London Stock Exchange, in Germany on the Frankfurt Exchange under the symbol PKZ and in Kazakhstan on the Kazakhstan Stock Exchange under the symbol CA_PKZ. * * * As reported in the Troubled Company Reporter on Aug. 26, 2005, Moody's Investors Service placed the Ba3 corporate family rating for PetroKazakhstan Inc. on review for possible upgrade. The company, which is the guarantor of the US$125 million notes issued by PetroKazakhstan Finance B.V., announced on Monday, the 22nd of August, that it has entered into an Arrangement Agreement with CNPC International Ltd which has offered to buy all outstanding PKZ common shares for USD 4.2 billion in cash. As reported in the Troubled Company Reporter on Aug. 25, 2005, Standard & Poor's Ratings Services placed its 'B+' long-term corporate credit rating on PetroKazakhstan Inc. on CreditWatch with positive implications, following China National Petroleum Corporation's (CNPC; not rated) offer to acquire PKZ. PRECISION CASTINGS: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Precision Castings of Tennessee, Inc. 430 Calvert Drive Gallatin, Tennessee 37066 Bankruptcy Case No.: 05-13160 Type of Business: The Debtor designs and produces metal castings for a variety of domestic and international customers. See http://www.pctcast.net/ Chapter 11 Petition Date: October 10, 2005 Court: Middle District of Tennessee (Nashville) Judge: Marian F. Harrison Debtor's Counsel: William L. Norton, III, Esq. Boult, Cummings, Conners & Berry, PLC 414 Union Street, Suite 1600 Nashville, Tennessee 37219 Tel: (615) 252-2397 Fax: (615) 252-6397 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Tradalloy $74,475 P.O. Box 744 Greensburg, TN 15601 Cooper Alloy Metals, L.P. Account $35,901 201 Sweetland Avenue Hillside, NJ 07205 Professional Svc. Industries Account $34,038 Pittsburgh Testing Lab. Div. P.O. Box 71168 Chicago, IL 60694-1168 Jade-Sterling Steel Co., Inc. Account $30,449 Metal Mgmt-Stainless & Alloy Account $26,640 MidSouth Metallurgical, Inc. Account $25,744 United Healthcare Account $24,645 Allied Metals Corporation Account $24,139 Volunteer Express, Inc. Account $24,124 Nalco Chemical Company Account $22,475 Atomic Industrial Supply Account $22,389 Pennsylvania Wax Corporation Account $21,010 Conway Southern Express Account $18,662 RK Tek Account $17,600 CE Metals Account $16,639 Independent Tool & Mold, Inc. Account $14,362 Benchmark Industrial Supply Account $14,242 Core-Tech, Inc. Account $14,242 Minco Inc. Account $13,889 Remelt Sources, Inc. Account $13,649 PUERTO RICO INDUSTRIAL: S&P Shaves Bond Ratings to B- from B+ ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on Puerto Rico Industrial, Medical, and Higher Education and Environmental Pollution Control Facilities Finance Authority's bonds, issued for Iglesia Episcopal Puertorriquena Inc., two notches to 'B-' from 'B+'. "IEP's credit characteristics are generally weak, with limited cash flow generation and slim liquidity levels," said Standard & Poor's credit analyst Stephen Infranco. Management hired outside consultants in 2001 and 2003 in an attempt to address some of its core operational issues, including an extremely high accounts receivable position. While some improvement was made in this area -- with days in accounts receivable at the two hospitals in Ponce, Hospital Episcopal San Lucas and Saint Luke's Memorial Hospital, dropping to 115 in 2004 from a previous high of more than 170 -- the figure is still significantly above industry benchmarks; days in accounts receivable for the two Ponce hospitals and Hospital Episcopal Cristo Redentor in Guayama totaled approximately 126. Furthermore, the drop in receivables did not translate into an improved liquidity position, as IEP's unrestricted cash position has actually declined approximately 41% since 2001. The outlook is stable based on continued volume growth and recent improvements in operating performance driven by better reimbursement from Medicare and some private payors. However, while the operations allow for some stability at the current rating level, there are ongoing concerns about the ability of the system to convert receivables to cash, the ultimate level of long- and short-term debt outstanding, and the system's ability to generate sufficient cash flow on a consistent basis to service the carrying charges, reinvest in plant and equipment, and build up its liquidity position. "For the rating to be raised, IEP would need to demonstrate sustained improvements in operating performance and some growth in liquidity," said Mr. Infranco. "A return to deficit operations, additional debt, or a further erosion of cash could result in the rating being lowered further." RADNOR HOLDINGS: PwC Replaces KPMG as Independent Accountants ------------------------------------------------------------- Radnor Holdings Corporation dismissed KPMG LLP as its independent registered public accounting firm effective upon filing by the Company of a Form 10-Q/A for the quarter ended July 1, 2005. On October 19, 2005, the Company notified KPMG that it has engaged PricewaterhouseCoopers LLP as its principal accountant for the year ending December 30, 2005. The change of auditor came in the heels of changes in financial and strategic supply chain executive changes. As reported in the Troubled Company Reporter on Oct. 11, 2005, Michael V. Valenza, the former Chief Financial Officer of the Company, will lead the initiative and will be responsible for all aspects of supply chain management. Paul D. Ridder, the former Corporate Controller, has been appointed the Chief Financial Officer of the Company. In addition, Michael P. Feehan will become Corporate Controller of the Company. Mr. Feehan joined the Company in 2004 as Director of Finance. Prior to joining Radnor, Mr. Feehan held various positions at Arthur Andersen LLP and KPMG LLP, most recently as an Audit Manager. Radnor Holdings Corporation -- http://www.radnorholdings.com/-- is a leading manufacturer and distributor of a broad line of disposable foodservice products in the United States and specialty chemical products worldwide. The Company operates 15 plants in North America and 3 in Europe and distributes its foodservice products from 10 distribution centers throughout the United States. At July 1, 2005, Radnor Holdings' balance sheet shows an $18,940,000 equity deficit, compared to a $770,000 deficit at Dec. 31, 2004. REFCO INC: Bank of America Asks Court for Adequate Protection ------------------------------------------------------------- Debtor Refco Group Ltd., LLC, borrowed money under a Credit Agreement dated August 5, 2004, with Bank of America, N.A., as administrative agent, swing line lender and L/C issuer, and a consortium of lenders. The Credit Agreement provided for term loans of up to $800,000,000 and a $75,000,000 revolving credit facility. As of the Petition Date, there was approximately $648,000,000 outstanding under the Credit Agreement. Debtor New Refco Group Ltd., LLC, and some affiliates of Refco Group guaranteed the Borrower's obligations. To secure their obligations, Refco Group and the Guarantors entered into a Security Agreement, dated August 5, 2005, with Bank of America. Bank of America was granted a security interest in substantially all of the assets of Refco Group and the Guarantors. The Security Agreement did not grant a security interest in some excluded property, including any deposit and security accounts of a Grantor. Donald S. Bernstein, Esq., at Davis Polk & Wardwell, in New York, notes that Refco Inc. has entered into a memorandum of understanding with a group of investors led by J.C. Flowers & Co., LLC, for the sale of the Company's futures brokerage business conducted through Refco LLC, Refco Overseas Ltd., Refco Singapore Ltd. and certain related subsidiaries and other assets. Refco LLC, Refco Overseas Ltd., and Refco Singapore Ltd. are all direct or indirect subsidiaries of Debtor Refco Global Futures LLC. The assets will be sold for $768,000,000. Mr. Bernstein points out that the Secured Lenders have a security interest in 100% of the equity interests in Refco LLC and 65% of the equity interests of Refco Singapore Ltd. In addition, the Secured Lenders have been granted a security interest in 65% of the equity interests in Refco Europe Ltd., the direct parent of Refco Overseas Ltd., as well as 100% of the equity interests of Debtor Refco Global Holdings, LLC, the direct parent of Refco Europe Ltd. "A secured creditor is entitled to adequate protection -- as a matter of right, not merely as a matter of discretion -- when the estate proposed to use, sell or lease property in which it has an interest," Mr. Bernstein says. "This protection is provided both as a matter of policy and, arguably, as a matter of constitutional law." Mr. Bernstein notes that because of the unique nature of cash, cash collateral receives special consideration under the Bankruptcy Code. Specifically, the Bankruptcy Code provides a debtor may only use cash collateral if it first obtains consent of the secured creditor or establishes to the court's satisfaction that the secured creditor is adequately protected. Mr. Bernstein tells the U.S. Bankruptcy Court for the Southern District of New York that the Secured Lenders do not consent to the Refco Inc., and its debtor-affiliates' use of the Collateral, including the Cash Collateral. According to Mr. Bernstein, the Debtors are using the Secured Lenders' Collateral to continue to operate their businesses. Thus, the Secured Lenders' Collateral is subject to diminution. The Secured Lenders are also concerned that the value of the Equity Interests may be diminished should the assets of that entity be transferred to another entity. Accordingly, Bank of America asserts that the Debtors should provide adequate protection of the Secured Lenders' interests in the Collateral. Specifically, Bank of America wants the Honorable Robert D. Drain of the Southern District of New York Bankruptcy Court to enter an interim order providing that: (a) The Debtors will use their best efforts to preserve the value of the Collateral; (b) Bank of America, as administrative agent for the Secured Lenders, is granted: * a first priority security interest and lien on all of the Debtors' assets to the extent of the aggregate diminution in value of the Collateral from and after the Petition Date, subject to certain liens and encumbrances; and * a "super priority" administrative claim to the fullest extent necessary to protect the Secured Lenders from any diminution of the value of the Collateral from and after the Petition Date; (c) The Debtors will make cash payments to Bank of America of all its reasonable out-of-pocket expenses; (d) The Debtors will segregate and account for all Cash Collateral, and will be prohibited from using or transferring the Cash Collateral without prior Court approval; provided that if Bank of America consents, the Debtors will be permitted to use or transfer up to $10,000,000 of Cash Collateral to pay for allowable administration expenses payable on or before November 4, 2005; (e) The Debtors will provide to Bank of America and its representatives and professionals, starting on October 26, 2005, and on every Wednesday thereafter, a disbursement forecast for the following calendar week and, at Bank of America's request, allow immediate access to the books and records related to the Collateral; (f) The liens created by the Loan Documents will attach to any proceeds of Collateral, and all proceeds will be paid to Bank of America for application to the Debtors' obligations; and (g) Bank of America for the benefit of the Secured Lenders will have the right at any time to seek further or different adequate protection. In the event the Court won't approve its request for adequate protection while the sale process is proceeding, Bank of America seeks relief from the automatic stay. Bank of America further asks Judge Drain to schedule a final hearing on the use of Collateral and adequate protection to be held on the earlier of November 4, 2005, or the date of any hearing on any motion seeking approval for the transfer or sale of any Collateral, including the Equity Interests. Headquartered in New York, New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Lead Case No. 05- 60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. As of Feb. 28, 2005, Refco Inc. and its debtor-affiliates listed $48,765,349,000 in total assets and $48,599,748,000 in total liabilities. (Refco Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 215/945-7000) REFCO INC: Wants Court Okay to Maintain Existing Bank Accounts -------------------------------------------------------------- Historically, Refco Inc., and its debtor-affiliates utilized a centralized cash management system to fund their operational needs. J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York, informs the U.S. Bankruptcy Court for the Southern District of New York that Debtor Refco Capital LLC holds three bank accounts in Harris Trust and Savings Bank and two accounts in Chase Manhattan. Mr. Milmoe relates that funds were transferred into the Concentration Account, on an as needed basis, from a number of sources, including from accounts held by Debtor Refco Capital Markets, Ltd. Funds were deposited from wire transfers and from a deposit account that is manually swept into the Concentration Account. In addition, funds were also disbursed from the Concentration Account into a separate payroll account. A third party service provider then coordinates disbursements from the Payroll Account to fund salary, wages, taxes and other employee related expenses. Mr. Milmoe tells the Honorable Robert D. Drain of the Southern District of New York Bankruptcy Courtthat a regular payroll disbursement was made to salaried and hourly employees on Friday, October 14, 2005. Disbursements were also made from the Concentration Account via wire transfers or through a separate checking account. Mr. Milmoe notes that Refco Capital funded substantially all of the Debtors operational needs, and historically provided liquidity to customers of certain regulated, non-debtor affiliates, for use in their business. Those intercompany transactions are recorded in the Debtors' and their non-Debtor affiliates' books and records. Mr. Milmoe further discloses that RCM and Refco F/X Associates, LLC, also have around 22 bank accounts, which are used in connection with their non-regulated trading operations. To supervise the administration of Chapter 11 cases, the U.S. Trustee has established certain operating guidelines for debtors- in-possession. These guidelines require Chapter 11 debtors to, among other things: (a) close all existing bank accounts and open new debtor-in- possession bank accounts, (b) establish one debtor-in-possession account for all estate monies required for the payment of taxes, including payroll taxes, and (c) maintain a separate debtor-in-possession account for cash collateral. Mr. Milmoe explains that the Debtors' limited resources that have been devoted to launching their cases, stabilizing their business operations, and negotiating a sale of the valuable regulated non- debtor businesses would be further strained if the Debtors were required to close existing accounts and establish a new cash management system. Accordingly, the Debtors seek the Court's authority to continue to maintain their existing bank accounts to avoid delays in payments to administrative creditors and to ensure as smooth a transition into Chapter 11 as possible with minimal disruption. The Debtors want that their existing bank accounts be deemed debtor-in-possession accounts and that their maintenance and continued use, in the same manner and with the same account numbers, styles, and document forms as those employed during the prepetition period, be authorized. If necessary, the Debtors also ask Judge Drain for permission to open new accounts wherever they are needed, regardless of whether those banks are designated depositories. Mr. Milmoe asserts that if the Debtors' request is granted, they will not pay -- and each of the banks at which the bank accounts are maintained will be directed not to pay -- any debts incurred before the Petition Date, other than as authorized by the Court. Headquartered in New York, New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Lead Case No. 05- 60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. As of Feb. 28, 2005, Refco Inc. and its debtor-affiliates listed $48,765,349,000 in total assets and $48,599,748,000 in total liabilities. (Refco Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 215/945-7000) RGIS INVENTORY: S&P Assigns Low-B Ratings on Proposed $570M Loans ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to RGIS Inventory Specialists. At the same time, Standard & Poor's assigned a 'B+' rating to the Auburn Hills, Michigan-based company's planned $420 million first-lien bank loan. A recovery rating of '2' was also assigned to the loan, indicating the expectation for substantial 80%-100% recovery of principal in the event of a payment default. S&P also assigned a 'B-' rating to the company's planned $150 million second-lien credit facility. A recovery rating of '5' was assigned to the loan, indicating the expectation for negligible 0%-25% recovery of principal in the event of a payment default. The outlook is negative. Proceeds from the bank loan will be used to pay a $500 million dividend to shareholders. "The ratings on RGIS reflect its inconsistent performance, weak cash flow measures, and a highly leveraged capital structure," said Standard & Poor's credit analyst Robert Lichtenstein. These risks are only partially offset by the company's leading position in the industry and its long relationships with almost all of its largest customers. RGIS is the largest inventory audit specialist, more than three times the size of the next competitor. It services 17,000 customers, both large and small, including department stores and discounters. The company's top 15 customers represent 37% of revenues, with Wal-Mart Stores Inc. being the largest at about 9%. RGIS has maintained relationships of 15 years or more with almost all of its large customers. ROBOTIC VISION: Chap. 7 Trustee Sets Creditors Meeting on Nov. 16 ----------------------------------------------------------------- Steven M. Notinger, the chapter 7 trustee overseeing the liquidation of Robotic Vision Systems, Inc., n/k/a Acuity Cimatrix, Inc., and its debtor-affiliates, will convene a meeting of the Debtors' creditors at 9:00 a.m., on Nov. 16, 2005, at 1000 Elm Street, 7th Floor, Room 702, Manchester, New Hampshire. This is the first meeting of creditors after the case was converted to a chapter 7 liquidation. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Headquartered in Nashua, New Hampshire, Robotic Vision Systems, Inc., n/k/a Acuity Cimatrix, Inc. -- http://www.rvsi.com/-- designs, manufactures and markets machine vision, automatic identification and related products for the semiconductor capital equipment, electronics, automotive, aerospace, pharmaceutical and other industries. The Company, together with its debtor- affiliate, filed for chapter 11 protection on Nov. 19, 2004 (Bankr. D. N.H. Case No. 04-14151). Bruce A. Harwood, Esq., at Sheehan, Phinney, Bass + Green represents the Debtors in their restructuring efforts. When the Debtors filed for chapter 11 protection, they listed $43,046,000 in total assets and $51,338,000 in total debts. The Court converted the Debtors' chapter 11 cases to a chapter 7 liquidation proceeding on Oct. 12, 2005. S-TRAN HOLDINGS: Gets Interim OK to Continue Using Cash Collateral ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware entered an interim order authorizing S-Tran Holdings, Inc., and its debtor- affiliates to: a) continue, until December 31, 2005, using cash collateral securing repayment of prepetition obligations to LaSalle Business Credit, LLC, and American Capital Financial Services, Inc., as agent for American Capital Strategies, Ltd., and ACS Funding Trust I; and b) pay $1,000,000 to LaSalle. Continued access of cash collateral will allow the Debtors to proceed with an orderly liquidation and maximize the recoveries for all creditors, and LaSalle will clearly benefit from a continued orderly liquidation. Debtors' Indebtedness The Debtors owe $11.8 million to LaSalle under senior secured credit facility. LaSalle asserts a security interest under the prepetition credit facility in all of the Debtors' assets. The Debtor also owe $7.5 million to ACFS. The debt to ACFS is secured by a lien on substantially all of the Debtors' assets pursuant to the note and equity purchase agreement dated February 6, 2003, between LaSalle, ACFS and the Debtors. Adequate Protection To provide the Lenders with adequate protection, LaSalle will be granted: * a first priority security interest in all of the Debtors' assets; and * a junior security interest, subject and prior to the existing senior liens of other secured creditors in all collateral encumbered by Prior Permitted liens. LaSalle will be paid $1 million of the auction proceeds from the sale of the Debtors' personal property assets payment of which to LaSalle was held back pursuant to the order permitting Debtors to pay lender, provided that additional payments are made in further reduction of the Debtors' indebtedness to LaSalle. ACFS will also receive additional liens in the collateral, excluding any and all avoidance actions, and subject and subordinate to carve-out. To the extent that the replacement liens are insufficient to adequately protect ACFS from any diminution in value, a superpriority administrative expense claim under section 507(b) of the Bankruptcy Code, is granted. A copy of the Debtors' budget is available for free at http://ResearchArchives.com/t/s?27b Headquartered in Cookeville, Tennessee, S-Tran Holdings, Inc., provides common carrier services and specialized in less-than- truckload shipments and also supplies overnight and second day service to shippers in 11 states in the Southeast and Midwestern United States. The Company and its debtor-affiliates filed for chapter 11 protection on May 13, 2005 (Bankr. D. Del. Case No. 05- 11391). Laura Davis Jones, Esq. at Pachulski, Stang, Ziehl, Young, Jones & Weintraub P.C. represents the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed total assets of $22,508,000 and total debts of $30,891,000. SHAW GROUP: Earns $17.9 Million of Net Income in Fourth Quarter --------------------------------------------------------------- The Shaw Group Inc. (NYSE:SGR) reported financial results for its fourth quarter and fiscal year ended August 31, 2005. Net income for the fourth quarter of fiscal 2005 was $17.9 million. This compares to net income of $10.9 million for the fourth quarter of fiscal 2004. Income from continuing operations for the fourth quarter of fiscal 2005 was $17.9 million, compared to $12.2 million for the fourth quarter of fiscal 2004. Revenues for the fourth quarter of fiscal 2005 were $818.7 million compared to $806.2 million in the previous year's fourth quarter. For the fiscal year ended August 31, 2005, the Company reported net income of $16.4 million, including charges of $47.8 million ($31.1 million after taxes) for the early retirement of debt and $6.9 million after taxes for the valuation of a deferred tax asset. Not including the charges, net income would have been $54.3 million for fiscal 2005. For the year ended August 31, 2004, Shaw reported a net loss of $29 million. Revenues for the fiscal year ended August 31, 2005 were $3.3 billion, compared to $3.0 billion for the fiscal year ended August 31, 2004. Shaw's backlog totaled $6.7 billion at August 31, 2005, Shaw's highest ever backlog and a 16% increase over the backlog at August 31, 2004. Approximately $2.4 billion, or 36% of the backlog, is expected to be converted during fiscal 2006. Nearly $3 billion, or 45% of the backlog, is comprised of projects for energy industry customers, primarily in fossil fuel and nuclear power plants and approximately $2.2 billion, or 33%, is in the environmental and infrastructure sector, primarily in contracts with Federal agencies. Approximately $1.4 billion of the backlog is related to the chemicals industry. J.M. Bernhard, Jr., Chairman and Chief Executive Officer of The Shaw Group, Inc., said, "We are very pleased with our fourth quarter net income of $0.23 per diluted share, as well as our positive net cash flows from operations of $7.0 million. This marks our sixth consecutive quarter with positive results in both net income and net cash flows, excluding the third quarter charges for the debt retirement and a deferred tax asset valuation allowance. Not including the third quarter charges, our net income for fiscal 2005 was a strong $0.77 per diluted share." Mr. Bernhard added, "Shaw reported record backlog as of August 31, 2005, as we added three very significant projects this past quarter - the PPL scrubbers, the SHARQ ethylene plant in Saudi Arabia, and the Cleco CFB power plant. We are particularly pleased with these major awards because they demonstrate our success in establishing a global leadership position in the markets we serve. As we move into fiscal 2006, Shaw will continue to be a world leader in providing solutions to industrial and governmental clients. We are well positioned with premier technology and professional capabilities to continue to pursue additional significant opportunities afforded us by expanding markets, especially within the fossil fuel and nuclear power generation, petrochemical processing, emergency response and infrastructure markets." Headquartered in Baton Rouge, Louisiana, The Shaw Group Inc. -- http://www.shawgrp.com/-- is a leading global provider of technology, engineering, procurement, construction, maintenance, fabrication, manufacturing, consulting, remediation, and facilities management services for government and private sector clients in the energy, chemical, environmental, infrastructure and emergency response markets. The Company, with over $3 billion in annual revenues, employs approximately 20,000 people at its offices and operations in North America, South America, Europe, the Middle East and the Asia-Pacific region. The Company was recently named to Fortune magazine's annual list of "America's Most Admired Companies" for the second consecutive year. * * * As reported in the Troubled Company Reporter on July 29, 2005, Standard & Poor's Ratings Services raised its corporate credit rating on engineering and construction services provider The Shaw Group Inc. to 'BB' from 'BB-' and removed it from CreditWatch, where it was placed with positive implications in April 2005. S&P said the outlook is stable. STRESSGEN BIOTECH: Raising $2.625 Mil. in Private Equity Placement ------------------------------------------------------------------ Stressgen Biotechnologies (TSX: SSB) has engaged Canaccord Capital Corporation for a private placement offering of up to 7,500,000 Units at a price of $0.35 per Unit for aggregate gross proceeds of up to $2,625,000. The size of the Private Placement may be increased by up to 5,000,000 million Units, or incremental proceeds of $1,750,000 in over-allotments. Canaccord has agreed to offer the Units on a best efforts agency basis. Each Unit is comprised on one common share and one-third of one common share purchase warrant. Each Warrant is exercisable into one common share of Stressgen Biotechnologies at a price of $0.50 for a period of twenty-four months. The Private Placement is subject to receipt of all required regulatory approvals. Stressgen Biotechnologies Corporation sells bioreagent products. The Company's primary focus since 1993 has been the research and development of innovative stress protein-based fusion products that will stimulate the body's immune system to combat viral infections and related cancers. The corporation is publicly traded on the Toronto Stock Exchange under the symbol SSB. * * * Going Concern Doubt The Company's auditor, Deloitte & Touche LLP, expressed substantial doubt about the Company's ability to continue as a going concern, in its March 14, 2005, audit report, pointing to the Company's recurring losses from operations and difficulty in generating sufficient cash flow to meet its obligations and sustain its operations. At June 30, 2005, the Company had cash, cash equivalents and short-term investments totaling $13,230,000, working capital of $9,400,000 and accumulated deficit of $222,409,000. At December 31, 2004, the Company had cash, cash equivalents and short-term investments totaling $21,578,000, working capital of $19,335,000 and accumulated deficit of $212,349,000. The Company incurred a net loss from continuing operations of $17,520,000 for the six months ended June 30, 2005, and a net loss from continuing operations of $31,845,000 for the year ended December 31, 2004. The Company used $16,967,000 of net cash in operations for the six months ended June 30, 2005. STRESSGEN BIOTECHNOLOGIES: European Patent Office Upholds Patent ---------------------------------------------------------------- Stressgen Biotechnologies (TSX: SSB) has received a favorable decision in its patent challenge by Antigenics from an Opposition Division of the European Patent Office that maintained the Company's European Patent EP-B1 1,002,110 in amended form. The Opposition by Antigenics was therefore dismissed, although they have the right to appeal the decision. Oppositions can be filed by third parties at the European Patent Office against European patents to challenge their validity. Antigenics filed an Opposition to Stressgen's patent in 2003, and cited over 140 documents to support its invalidity arguments. After fully considering the documents and extensive written and oral arguments of opposing counsel, the European Patent Office announced its decision, favorable to Stressgen, on October 19, 2005. This patent can be kept in force until 2018. "We are obviously pleased that an Opposition Division of the European Patent Office has upheld our patent," commented Gregory M. McKee, President and CEO of Stressgen. "This successful ruling maintaining the original patent provides further evidence of the strength of our heat shock protein intellectual property portfolio, and in particular, reinforces an important composition- of-matter patent covering our lead product candidate, HspE7." The Opposition Division of the European Patent Office held that the amended claims involve inventive step and are fully enabled. These claims cover fusion proteins comprising a heat shock protein, or portions thereof, and a human papillomavirus (HPV) protein antigen, or portion thereof, and being capable of inducing or enhancing a cell-mediated, cytolytic immune response in patients. The claims also cover related embodiments, such as nucleic acids encoding the fusion protein and pharmaceutical compositions containing the fusion protein. Stressgen Biotechnologies Corporation sells bioreagent products. The Company's primary focus since 1993 has been the research and development of innovative stress protein-based fusion products that will stimulate the body's immune system to combat viral infections and related cancers. The corporation is publicly traded on the Toronto Stock Exchange under the symbol SSB. * * * Going Concern Doubt The Company's auditor, Deloitte & Touche LLP, expressed substantial doubt about the Company's ability to continue as a going concern, in its March 14, 2005, audit report, pointing to the Company's recurring losses from operations and difficulty in generating sufficient cash flow to meet its obligations and sustain its operations. At June 30, 2005, the Company had cash, cash equivalents and short-term investments totaling $13,230,000, working capital of $9,400,000 and accumulated deficit of $222,409,000. At December 31, 2004, the Company had cash, cash equivalents and short-term investments totaling $21,578,000, working capital of $19,335,000 and accumulated deficit of $212,349,000. The Company incurred a net loss from continuing operations of $17,520,000 for the six months ended June 30, 2005, and a net loss from continuing operations of $31,845,000 for the year ended December 31, 2004. The Company used $16,967,000 of net cash in operations for the six months ended June 30, 2005. SWIFT & CO: S&P Reviews BB- Corp. Credit Rating & May Downgrade --------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'BB-' corporate credit rating and other ratings on one of the largest U.S. protein processors, Swift & Co., on CreditWatch with negative implications. At Aug. 28, 2005, Greeley, Colorado-based Swift had total debt -- adjusted for capitalized operating leases -- of $738.1 million. The CreditWatch placement reflects the difficult operating conditions in all three of the company's segments -- Swift Beef, Swift Pork, and Swift Australia, and the related weakness in credit protection measures. S&P's analysis will focus on management's operating expectations and its financial strategies given the current difficult industry conditions. TIMOTHY MCCORMICK: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Timothy McCormick d/b/a TLC Pets of Darien 84 Wilton Crest Wilton, Connecticut 06897 Bankruptcy Case No.: 05-52015 Type of Business: The Debtor operates a retail pet store. Chapter 11 Petition Date: October 16, 2005 Court: District of Connecticut (Bridgeport) Debtor's Counsel: Ellery E. Plotkin, Esq. 777 Summer Street, 2nd Floor Stamford, Connecticut 06901 Tel: (203) 325-4457 Fax: (203) 325 4376 Estimated Assets: Not Provided Estimated Debts: $50,001 to $100,000 Debtor's 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Internal Revenue Services $40,000 135 High Street, Stop 155 Hartford, CT 06103 Rucci Burnham Carta Carello & Reilly, LLP $9,945 P.O. Box 1107 Darien, CT 06820 E.K. Williams & Co. $6,885 251 North Avenue, Suite 104 Bridgeport, CT 06606 SNET Information Services, Inc. $6,054 Department of Revenue Services $5,055 Chase Small Business Financial Services $5,052 Staples Credit Plan $4,136 Chase Auto Finance $2,242 CIT Technology Fin Serv Inc. $2,038 Vanguard Greene and West $2,012 OK Pet Supply, Inc. $1,030 Esxxon Mobil $1,024 Yankee Gas Services Co $940 Stamford Anesthesiology Services, P $880 One Beacon Insurance $775 Sprint $685 Connecticut Light & Power $650 Jungle Inc. $536 Hanover Insurance $465 Wilton Emergency Medical Svc. $414 THISTLE MINING: Expects to Spend $4.5 Million in African Job Cuts ----------------------------------------------------------------- Thistle Mining Inc. (AIM: TMG) reported that management of its President Steyn Gold Mine in South Africa reached agreement with the National Union of Mine Workers and the Solidarity Union pursuant to section 189A of the Labour Relations Act. A section 189A restructuring obliges the employer and the unions to engage in a process of consultation, the purpose of which is to attempt to reach consensus on a broad range of issues, including measures to avoid job losses and, should these become necessary, the timing, selection criteria and the severance terms of such losses. Key elements of the agreement are: -- Termination of certain contractors Formal notice has been given to these contractors in terms of contractual agreements with the Mine. -- Undertaking by the Unions to work a 6-day workweek and to terminate Continuous Operations (operational on every day of the year other than South African public holidays) at number 3 shaft as from October 17, 2005. The Continuous Operations agreement negotiated with the Unions earlier in the year has proved not to be as productive as originally planned. -- Re-employment provisions Should there be a need to engage employees in the future: (1) management have agreed to recall retrenched employees for a 12 month recall period; and (2) thereafter management have agreed to give preference to retrenched employees for a further 12 month period. -- Severance terms for voluntary and involuntary retrenchments. The severance package includes the payment of one month's notice period plus payment of 2 weeks of wages for every year of completed service. -- Provision has also been made for retraining of employees who are subject to involuntary retrenchment. The number of voluntary and involuntary retrenchments amounts to approximately 52 and 1347 employees respectively, or 27% of the current workforce at the Mine. This is less than the 2,000 jobs that management initially believed might be affected and gives credit to the Section 189 consultancy process. After giving effect to the retrenchments production staff has been reduced by approximately 10% in aggregate while non-production staff has been reduced by approximately 40% in aggregate. The total cost of retrenchment is estimated at approximately R29 million or US$4.5 million. The implementation of the agreement is expected by management to assist in restoring the profitability of the Mine. Thistle Mining (TSX: THT and AIM: TMG) -- http://www.thistlemining.com/-- says its goal is to become one of the fastest gold mining growth operations in the world. Thistle has focused on acquiring companies with established reserves and will not be developing green field sites. The company operations in South Africa and Kazakhstan are in production, while the Masbate project in the Philippines is forecast to commence production in the latter half of 2005. The Company obtained an order on January 7, 2005, to commence Thistle's restructuring under the Companies' Creditors Arrangement Act. On May 3, 2005, the Company's affected creditors approved the Company's Plan. The Court approved the Plan on May 10, 2005. Thistle Mining emerged from the Companies' Creditors Arrangement Act protection on June 30, 2005. The Company's management said in its second quarter report that although the implementation of the Plan will significantly reduce its financial liabilities, the Company will still require additional financing through the remainder of 2005 to continue funding its South African operations, complete the feasibility study of its Philippine operations, service its debt obligations and fund its corporate expenses. The Company has not yet obtained additional financing and does not have any additional sources of cash flow from operations. Until the Company is able to obtain additional financing, either through additional debt or equity, the Company will be dependent on the continued financial support of Meridian, who has provided approximately $21.8 million in short term funding for the period January 7, 2005, to June 30, 2005. Meridian Capital Limited has assigned one-half of its interests in the financing to Casten Holdings Limited and one-half of its interests in the financing to MC Resources Limited, a wholly owned indirect subsidiary of Meridian Capital Limited. Although the Company believes that Casten and MC Resources Limited will continue to support it through the balance of 2005 as it attempts to implement its revised business plan, there can be no assurances that Meridian will provide additional financing and that the Company will be able to continue as a going concern. TIME WARNER: S&P Junks $240-Mil. Senior Secured Notes After Review ------------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its 'B' corporate credit and 'CCC+' senior unsecured debt ratings on Littleton, Colorado-based competitive local exchange carrier Time Warner Telecom Inc., as well as the 'B' corporate credit and 'CCC+' senior unsecured debt ratings for intermediate holding company Time Warner Telecom Holdings Inc. At the same time, we lowered the rating on the $240 million senior secured second lien floating rate notes to 'CCC+' from 'B'. "Ratings were simultaneously removed from CreditWatch, where they were placed with negative implications on Sept. 1, 2005, given our heightened concerns about the company's ultimate debt repayment ability in light of continued net free cash flow shortfalls generated by the company after capital expenditures and an uncertain competitive environment," said Standard & Poor's credit analyst Catherine Cosentino. The rating outlook is negative. At the same time, Standard & Poor's assigned a 'B' rating to Time Warner Telecom Holdings Inc.'s $310 million in total secured credit facilities with a '5' recovery rating, indicating negligible 0-25% of principal recovery prospects in a payment default or bankruptcy scenario. Borrowings under the term loan will be used to fund capital expenditures, and the company will refinance its $200 million 9.75% senior notes due 2008 from cash on hand. At June 30, 2005, the company had $1.5 billion of total debt outstanding. The affirmation reflects our assessment that Time Warner Telecom's business risk, while still vulnerable, continues to support the current 'B' rating, given its ongoing generation of EBITDA and potential to achieve a meaningful net free cash flow positive position over the next several years as it expands its enterprise customer revenues. Growth in the company's Metro Ethernet services will be a particularly important component in achieving such net cash improvement. Business customers gradually have been adopting such services, because they provide more flexible features relative to traditional private line, frame relay, or ATM services. S&P expects business customers increasingly will adopt Metro Ethernet services over the next few years, and that Time Warner Telecom's revenue levels will benefit from this service growth. TITANIUM METALS: H.C. Simmons Replacing J.L. Martin as CEO ---------------------------------------------------------- Titanium Metals Corporation's (NYSE: TIE) Chairman, President and Chief Executive Officer, J. Landis Martin, reported his retirement from the Company effective November 15. Mr. Martin has been CEO of TIMET since 1995 and Chairman since 1987. Robert Musgraves, current Chief Operating Officer for North America and Christian Leonhard, current Chief Operating Officer for Europe, will become co-Presidents upon Martin's retirement. Harold C. Simmons, the controlling stockholder of TIMET and TIMET's parent company Valhi, Inc., will become Chairman of the Board and Chief Executive Officer. Steven L. Watson, President and Chief Executive Officer of Valhi, Inc., will become Vice Chairman of the Board. Robert Musgraves has served as Chief Operating Officer for North America since 2002. Mr. Musgraves previously served as Executive Vice President of TIMET from 2000 to 2002 and as General Counsel from 1990 to 2002. Christian Leonhard has served as Chief Operating Officer for Europe since 2002. Mr. Leonhard previously served as Executive Vice President for Operations of TIMET from 2000 to 2002. Mr. Leonhard joined TIMET in 1988 as General Manager of TIMET France, became President of TIMET Savoie S.A. in 1996 and President of European Operations in 1997. Mr. Martin said, "I have had the good fortune of working with Bob and Christian for over 15 years. As co-Presidents, I have every confidence that they will be well positioned to help TIMET take advantage of the many opportunities that it currently has." Martin also said that following his retirement from TIMET he plans to form a private equity firm to invest in middle and small market industrial companies. Mr. Simmons said, "Lanny has provided excellent leadership and guidance for several of our businesses for a long period of time. In recent years, he and his team at TIMET have positioned the business to continue to excel in the future. We are very confident that the team leadership by Bob and Christian will serve the Company well." Headquartered in Denver, Colorado, Titanium Metals Corporation -- http://www.timet.com/-- is a worldwide producer of titanium metal products. * * * As reported in the Troubled Company Reporter on Mar. 18, 2005, Standard & Poor's Ratings Services raised its corporate credit rating on Denver, Colorado-based Titanium Metals Corp., to 'B+' from 'B'. Standard & Poor's also raised its preferred stock rating to 'CCC+' from 'CCC'. S&P says the outlook is stable. TITANIUM METALS: Declares Dividend on 6-3/4% Series A Pref. Stock ----------------------------------------------------------------- Titanium Metals Corporation's (NYSE: TIE) board of directors declared a quarterly dividend of $0.84375 per share on its 6-3/4% Series A Preferred Stock, payable on December 15, 2005, to stockholders of record as of the close of business on December 1, 2005. Headquartered in Denver, Colorado, Titanium Metals Corporation -- http://www.timet.com/-- is a worldwide producer of titanium metal products. * * * As reported in the Troubled Company Reporter on Mar. 18, 2005, Standard & Poor's Ratings Services raised its corporate credit rating on Denver, Colorado-based Titanium Metals Corp., to 'B+' from 'B'. Standard & Poor's also raised its preferred stock rating to 'CCC+' from 'CCC'. S&P says the outlook is stable. TOYS "R" US: S&P Junks Senior Unsecured Notes After Review ---------------------------------------------------------- Standard & Poor's Rating Services lowered its corporate credit rating on Toys "R" Us Inc. to 'B-' from 'B+' and the senior unsecured rating to 'CCC' from 'B-'. All ratings were removed from CreditWatch, where they had been placed with negative implications since Jan. 8, 2004. At the same time, Standard & Poor's assigned a 'B-' rating to the proposed $1.5 billion U.S. PropCo credit facility due in 2008. Proceeds from this offering will be used to repay the majority of a $1.9 billion bridge loan that was used to help finance the $6.2 billion acquisition of the Wayne, New Jersey-based company by three investment groups. The outlook is stable. "The downgrade reflects Toys "R" Us' substantial debt burden post-merger," said Standard & Poor's credit analyst Diane Shand. Total debt to EBITDA increased to 8.4x for the 12 months ended Aug. 2, 2005, from 5.4x for the 12 months ended May 3, 2005, due to the leveraged buyout. The ratings on Toys "R" Us Inc. reflect the company's participation in the intensely competitive retail toy industry, its inability to find a differentiated niche within the U.S. toy industry, its high leverage, and thin cash flow protection measures. Since the mid-1990s, Toys has faced intense competition from discount department stores and other retailers of toys and electronic games. In addition, traditional toys have decreased in importance, as children are turning to video games, computer software, sporting goods, and music for entertainment at younger ages. As a result, Toys' performance has been inconsistent despite its important position in the toy industry and management's repositioning efforts. TRISTAR HOTEL: Sec. 341(a) Meeting Continued to October 26 ---------------------------------------------------------- The U.S. Trustee for Region 17 will continue the meeting of Tristar Hotels and Investments, LLC's creditors tomorrow, Oct. 26, 2005, at 2:00 p.m., at Room 269, U.S. Federal Bldg., 280 S 1st Street, San Jose, California 95113-3004. The Debtor or its counsel did not appear on the previously scheduled meeting on Oct. 5, 2005. This is the first meeting of creditors required under 11 U.S.C. Sec. 341(a) in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Headquartered in Mountain View, California, Tristar Hotels and Investments, LLC, filed for chapter 11 protection on Sept. 13, 2005 (Bankr. N.D. Calif. Case No. 05-55789). Steven J. Sibley, Esq., at the Law Offices of DiNapoli and Sibley represents the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it listed estimated assets and debts of $10 million to $50 million. UAL CORP: Wants Settlement on Barclays' $14.4 Million Claim Okayed ------------------------------------------------------------------ Prior to UAL Corporation's bankruptcy petition date, Barclays Bank PLC financed two 737-322 aircraft in UAL and its debtor- affiliates' fleet through leveraged lease transactions. The Aircraft bear tail numbers N323UA and N324UA. Each of the Aircraft was initially acquired by a separate owner trust that in turn leased the Aircraft to the Debtors under lease agreements dated Aug. 1, 1988. Under the terms of the Leases, the Debtors were obligated to make regular rent payments as set forth in each Lease. From and after the Petition Date, the Debtors continued to use the Aircraft in their business operations. The Aircraft were part of the auction pool portion of the Debtors' fleet. Shortly after the Petition Date, the Debtors sent proposals to financiers of auction pool aircraft to restructure its lease and mortgage obligations. In December 2002, Barclays signed two restructuring proposals related to the Aircraft, under which the Debtors would compensate Barclays at a rate of $65,000 per month for its use of the aircraft. The next step in the process was for the Debtors and Barclays to execute term sheets that would provide more detail to the restructuring proposals. In July 2003, the Debtors and Barclays entered into two separate term sheets for the Aircraft, which the Court approved. The Debtors were, thus, authorized to execute definitive documentation in connection with the restructuring of the Leases. The Term Sheets would expire if the parties did not complete the definitive documentation within a certain period of time. The termination dates of the Term Sheets were extended numerous times as the parties negotiated the definitive documentation to complete the restructurings. However, the Debtors and Barclays could not come to terms on the definitive documentation, and the Term Sheets eventually expired in November 2004. Per the Term Sheets, the Debtors did not make any payments to Barclays for its use of the Aircraft while the parties attempted to complete the definitive documentation. In January 2005, the Debtors and Barclays entered into a letter agreement by which the Debtors would reject the Aircraft and return them to Barclays. The Debtors rejected the leases pursuant to a Court order dated January 24, 2005 with an effective rejection date of January 31, 2005. In March 2005, Barclays filed claims which amended previously filed claims and which assert administrative and unsecured claims with respect to the Aircraft: Previously-Filed Claim No. Claim No. Aircraft --------- ---------------- -------- 43867 39137 N324UA 43866 3910 N323UA Barclays asserts an aggregate of $32,255,096 in unsecured claims. In August 2005, Barclays sought the allowance and payment of an administrative expense claim for the Debtors' postpetition use of the Aircraft. Barclays calculated the Administrative Claim under the Leases at $6,216,992 for N323UA, and $6,219,469 for N324UA -- plus attorneys' and brokerage fees -- for a total of $14,125,550. The Debtors and the Official Committee of Unsecured Creditors objected to the Administrative Expense Request. The Debtors, Barclays, and the Committee submitted a joint pretrial statement on Sept. 12, 2005, in preparation for an evidentiary hearing on the Administrative Expense Request. In the interim, the Debtors and Barclays engaged in a series of good-faith negotiations and reached an agreement to resolve the Administrative Expense Request and the Claims. The Debtors ask the U.S. Bankruptcy Court for the Northern District of Illinois to approve its settlement with Barclays. The settlement provides that: (a) the Debtors will pay Barclays $81,363 per month for use of the Aircraft from the Petition Date through the Return Date, totaling $2,077,469 for N323UA and $2,101,879 for N324UA, for a total of $4,179,348; (b) the Debtors will pay Barclays $30,000 in legal fees; and (c) Barclays will be allowed an Unsecured Claim for $10,359,915 for N323UA and $10,404,638 for N324UA, which was calculated by subtracting the current fair market value of the aircraft and the administrative claim payments from the stipulated loss value of the aircraft at the Petition Date and $85,000 in attorneys' fees. Mark Kieselstein, Esq., at Kirkland & Ellis, in Chicago, Illinois, asserts that the settlement with Barclays is advantageous to the Debtors. Barclays will receive $11,500,000 less than the face value asserted in its Claim. The Debtors will avoid the costs of additional negotiation or litigation, in which there is no guarantee of success. Without the settlement, the matter would proceed to an evidentiary hearing with legal preparation and expert testimony. Mr. Kieselstein admits that the settlement of the Administrative Claims exceeds the amount of postpetition rent under the Term Sheets. However, the settlement amount approximates market rates for the Debtors' postpetition use of the Aircraft. This compromise prevents the Debtors from having to compensate Barclays at much higher prepetition lease rates under Section 365(d)(10) of the Bankruptcy Code, Mr. Kieselstein says. Headquartered in Chicago, Illinois, UAL Corporation -- http://www.united.com/-- through United Air Lines, Inc., is the holding company for United Airlines -- the world's second largest air carrier. The Company filed for chapter 11 protection on December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the Debtors in their restructuring efforts. When the 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. 104; Bankruptcy Creditors' Service, Inc., 215/945-7000) UAL CORP: Wants Court to Approve VX Capital Aircraft Settlement --------------------------------------------------------------- Vx Capital Partners LLC is the controlling party of six aircraft bearing Tail Nos.: -- N173UA, -- N320UA, -- N343UA, -- N383UA, -- N385UA, and -- N386UA. All aircraft are Boeing Model 737-322, except Tail No. N173UA, which is a Boeing 747-422. Vx Capital is acting on behalf of: Owner Participant Aircraft ----------------- -------- V6U-737 LLC N320UA V9U-737 LLC N343UA V8U-737&757 LLC N383UA V3U-747 LLC N173UA V4U-737x2 LLC N385UA N386UA Against this backdrop, UAL Corporation and its debtor-affiliates ask the U.S. Bankruptcy Court for the Northern District of Illinois to approve their letter agreement with Vx Capital, resolving certain claims filed by Vx Capital with respect to respect these Aircraft: 1) N320UA The Debtors will pay V6U a $1,972,500 administrative claim for rent from the Petition Date to February 28, 2005, equating to $75,000 per month. V6U will also be allowed a $12,860,728 general, unsecured deficiency claim. 2) N343UA The Debtors will pay V9U a $2,580,000 administrative claim for rent from the Petition Date to October 21, 2005, equating to $75,000 per month, to be adjusted pro-rata if the October 21 return date is delayed. V9U will also be allowed a $13,198,544 general unsecured deficiency claim. 3) N320UA and N343UA The Debtors' obligations derived from these aircraft will be paid in cash. The general, unsecured deficiency claims for the two aircraft will be calculated by subtracting the sum of: (a) current fair market value of the aircraft; and (b) administrative claims paid under the Letter Agreement, from the stipulated loss value, as of the Petition Date, plus $100,000 for legal fees. 4) N383UA, N385UA, and N386UA V8U and V4U will reduce the monthly rent on these aircraft from $100,000 to $85,000 for the remainder of the lease. The Debtors will relinquish the termination option on these aircraft. 5) N173UA The Debtors will relinquish the termination option on this aircraft. David A. Agay, Esq., at Kirkland & Ellis, in Chicago, Illinois, assures the Court that the Letter Agreement is in the best interests of the Debtors, creditors and the estates. V6U and V9U are entitled to an administrative claim for the Debtors' use of Aircraft N320UA and N343UA. The Debtors will pay rent in excess of the term sheet rates by $10,000, but will avoid the cost and uncertainty of litigating the "market value" for using these aircraft. Without a settlement, Mr. Agay says, the matter would require an evidentiary hearing and expert testimony. Since the market for B737 aircraft has improved recently, the Debtors would risk that the "market rate" exceeds $75,000 for the months preceding rejection of the aircraft. Also, in exchange for the administrative claims for N320UA and N343UA and the return of N343UA, the rent on N383UA, N385UA, and N386UA has been reduced by $15,000 for each plane for the remainder of the lease. Mr. Agay asserts that the new rates for these aircraft "are very attractive and are below current market rates." The $47,454,903 general, unsecured deficiency claims asserted in connection with N320UA and N343UA will also be settled for $20,000,000 less under the Letter Agreement. Headquartered in Chicago, Illinois, UAL Corporation -- http://www.united.com/-- through United Air Lines, Inc., is the holding company for United Airlines -- the world's second largest air carrier. The Company filed for chapter 11 protection on December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the Debtors in their restructuring efforts. When the 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. 104; Bankruptcy Creditors' Service, Inc., 215/945-7000) UAL CORP: Inks Pact Resolving Disputes with NJ Treasury Department ------------------------------------------------------------------ On July 15, 2005, the New Jersey Department of Treasury, Division of Taxation, issued a final determination letter to UAL Corporation and its debtor-affiliates for sales and use taxes, recounts Eric W. Chalut, Esq., at Kirkland & Ellis, in Chicago, Illinois. The Final Determination asserted that the Debtors owed the NJDOT sales tax and interest of: * $636,013 for the period from July 1998 to September 2001; and * $119,055 for the period from October 2001 to June 2002. The NJDOT filed Priority Claim No. 43492 for $993,576 in the Debtors' cases, reflecting its estimate of the Debtors' tax liability based on an audit of United Air Lines, Inc. The Debtors and the NJDOT negotiated to resolve the dispute and eventually entered into a settlement. The Debtors ask the Court to approve their Tax Settlement with the NJDOT. The Tax Settlement provides that the Debtors will pay $450,000 to the NJDOT to satisfy the Claims within 30 days from the Confirmation Order, no later than March 31, 2006. Mr. Chalut assures the Court that the Debtors engaged in good faith, arm's-length negotiations with the NJDOT. The Tax Settlement is in the best interests of the estate and will allow the Debtors to avoid further litigation, which costs may exceed the claimed deficiency. Headquartered in Chicago, Illinois, UAL Corporation -- http://www.united.com/-- through United Air Lines, Inc., is the holding company for United Airlines -- the world's second largest air carrier. The Company filed for chapter 11 protection on December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the Debtors in their restructuring efforts. When the 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. 104; Bankruptcy Creditors' Service, Inc., 215/945-7000) VERITAS DGC: S&P Assigns BB Rating on $155 Million Senior Notes -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on seismic services company Veritas DGC Inc. to 'BB' from 'BB+'. Standard & Poor's also assigned its 'BB' rating to the company's $155 million in convertible floating rate senior notes due in 2024. The outlook is stable. As of July 31, 2005, Houston, Texas-based Veritas had approximately $232 million in adjusted total debt. "The downgrade reflects our concerns regarding the volatility and cyclicality associated with the geophysical sector throughout the hydrocarbon pricing cycle," said Standard & Poor's credit analyst Jeffrey Morrison. "The rating action also reflects a reassessment of Veritas' business profile," continued Mr. Morrison. The stable outlook incorporates the expectation that Veritas will continue to benefit from favorable near-term industry conditions, free cash flow generation, solid liquidity levels, and moderate financial policies. VIA NET.WORKS: Completes Sale of All Operations to Interoute ------------------------------------------------------------ VIA NET.WORKS, Inc. (Euronext: VNWI) (OTC: VNWI.PK) completed the sale of substantially all of its operating assets to Interoute Communications Holdings S.A. and certain of its affiliates for $18.1 million, of which $5 million was advanced to the Company prior to the closing under an interim financing facility. In the asset sale, Interoute acquired all of the Company's remaining business operations comprised of its PSINet Europe operations in Germany, France, Belgium, Switzerland and the Netherlands and its VIA NET.WORKS operations in France, Germany and Spain, as well as certain assets pertaining to VIA's centralized back office and technical support systems. The sale was closed shortly after the Company's special meeting of its shareholders in which the requisite shareholder vote was obtained to approve the asset sale. At the special meeting, shareholders holding 67% of the Company's total outstanding voting shares approved the proposal regarding the asset sale, representing 99% of all proxies represented and votes cast at the meeting. Company Dissolution Also, at the special meeting, VIA's shareholders approved a plan providing for the voluntary dissolution of the Company. VIA intends to file a certificate of dissolution with the Delaware Secretary of State within two weeks. Pursuant to the plan of dissolution, VIA will liquidate its remaining assets, satisfy or make reasonable provisions for its remaining obligations and make distributions to its shareholders of all remaining proceeds. If the Company's board of directors determines that liquidation and dissolution is not in VIA's best interests and the best interests of its shareholders and creditors, our board of directors may direct that the plan of dissolution be abandoned or may amend or modify the plan of dissolution to the extent permitted by Delaware law. The Company further noted that it will begin immediately to use the net proceeds of the sale transaction to pay down its significant outstanding obligations to creditors and vendors. VIA NET.WORKS, Inc. (Euronext: VNWI) (OTC: VNWI.PK) -- http://www.vianetworks.com/-- provides business communication solutions to small- and medium-sized businesses in Europe. Through its VIA NET.WORKS and PSINet Europe brands it offers a comprehensive portfolio of business communications services, including hosting, security, connectivity, networks, voice and professional services. At June 30, 2005, VIA NET.WORKS' balance sheet showed a $874,000 stockholders' deficit, compared to $32,605,000 of positive equity at Dec. 31, 2004. VISTEON CORP: Audit Panel Completes Independent Accounting Review ----------------------------------------------------------------- The Audit Committee of Visteon Corporation's Board of Directors has completed its independent review of the accounting for certain transactions relating to the company's North American purchasing group. As previously reported, the Audit Committee determined that certain expenses for freight, raw materials and other supplier costs originating in North America were recorded in periods after Dec. 31, 2004, and should have been recorded in prior periods; the company's management has concurred in that determination. The Committee has retained Paul, Weiss, Rifkind, Wharton & Garrison LLP, as outside counsel. The Firm has retained Navigant Consulting, as forensic accountants. Based on the results of this review, the company concluded that its financial statements for the years ended Dec. 31, 2004, 2003 and 2002 included in its 2004 Form 10-K (and the related 2004 Management Report on Internal Control Over Financial Reporting) should no longer be relied upon, and that restatements will be required for these periods. The company estimates that the restatements to correct these errors and other identified adjustments will increase Visteon's previously reported $1.499 billion after-tax net loss for 2004 by $35-40 million, or approximately 3%; its previously reported after-tax net loss of $1.207 billion for 2003 by $20-25 million, or approximately 2%; and its previously reported after-tax net loss of $368 million for 2002 by $10-15 million, or approximately 4%. Visteon is assessing the impact of these corrections and other adjustments on previously disclosed financial results for 2005 and will include the results of that assessment in the company's quarterly reports on Form 10-Q for 2005. Visteon plans to complete its review of the proposed adjustments to facilitate the filing of restated quarterly and annual financial results for 2004, 2003 and 2002, to be included in an amended 2004 annual report on Form 10-K and quarterly reports on Form 10-Q for 2005, with the Securities and Exchange Commission in the fourth quarter of 2005. Material Weakness Although management has not completed its analysis of the impact of the matters noted on its internal controls over financial reporting, management expects that there are one or more material weaknesses as of Dec. 31, 2004, in addition to those previously reported. The Audit Committee's independent review has also determined that many of the accounting errors resulted principally from improper conduct on the part of two former, non-executive finance employees responsible for the accounting oversight of these matters, and specifically from the periodic setting of accruals for freight expenses at inadequate levels, as well as delays in the processing of freight payments and raw material price increases without adequate consideration of applicable accounting standards. Visteon Corporation is a leading global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. With corporate offices in Van Buren Township, Mich. (U.S.); Shanghai, China; and Kerpen, Germany; the company has more than 170 facilities in 24 countries and employs approximately 50,000 people. * * * As reported in the Troubled Company Reporter on July 4, 2005, Moody's Investors Service has raised the corporate family rating (previously called senior implied) of Visteon Corporation to B2 from B3 and raised the company's Speculative Grade Liquidity Rating to SGL-3 from SGL-4. The rating on the company's senior unsecured notes has been affirmed at B3, and the rating outlook is stable. WILLIAM COYLE: Case Summary & 16 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: William Earle Coyle, Jr. 195 Presque Isle Houma, Louisiana 70263 Bankruptcy Case No.: 05-21112 Chapter 11 Petition Date: October 16, 2005 Court: Eastern District of Louisiana (New Orleans) Debtor's Counsel: William S. Robbins, Esq. Stewart Hood & Robbins LLC 321 Saint Joseph Street Baton Rouge, Louisiana 70802 Tel: (225) 267-3390 Fax: (225) 267-3390 Estimated Assets: Less than $50,000 Estimated Debts: $1 Million to $10 Million Debtor's 16 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ BLC Commercial Capital Corp. Guaranty of Loan to $2,914,422 645 Madison Avenue Bilco Tools, Inc. New York, NY 10022 Prudential Financial Life Insurance $70,000 Prudential Customer Service Policy Loan Office P.O. Box 7390 Philadelphia, PA 19101-7390 Prudential Financial Life Insurance $30,000 Prudential Customer Service Policy Loan Office P.O. Box 7390 Philadelphia, PA 19101-7390 Hibernia National Bank Line of Credit $25,935 GMAC 2005 Chevy Equinox $25,384 Value of security: $18,705 American Express Bilco Tools, Inc. $23,205 Credit Card Chase Bank Bilco Tools, Inc. $22,093 Credit Card Chase Bank Bilco Tools, Inc. $10,637 Credit Card Sears Gold Master Card Credit Card $10,370 Hibernia National Bank Line of Credit $8,142 Bank of America Credit Card $4,921 Prudential Financial Life Insurance $3,968 Policy Loan Citi Cards Exxon/ Mobil $2,802 Credit Card Sam's Club Club Card $1,138 American Express Bilco Tools, Inc. $651 Credit Card Reasonover, Kirk, Esq. Unknown WINN-DIXIE: Trade Creditors Transferrs More Than $5 Mil. Claims --------------------------------------------------------------- From July to September 2005, the Clerk of the Bankruptcy Court of the U.S. Bankruptcy Court for the Middle District of Florida recorded about 300 claim transfers in Winn-Dixie Stores, Inc., and its debtor-affiliates' Chapter 11 cases. The Claim Transfers include: Transferor Transferee Claim Amount ---------- ---------- ------------ Bell Company, Inc. Fair Harbor Capital, LLC $10,551 Burris Logistics Madison Investment Trust 22,205 Elkmont Associates Madison Investment Trust 306,281 Falcon Farms, Inc. Credit Suisse Bank 2,166,255 Florida Keys Spring Trade-Debt.net 1,972 Water Corp. HJ Heinz Company LP Madison Investment Trust 1,603,959 Infosys Technologies Madison Investment Trust 250,354 Ken Robinson Cactus Holdings Group, LLC 25,414 Kings Hawaiian Madison Investment Trust 46,016 Bakery West LN Piedmont Village LLC Liquidity Solutions 348,877 Mattel Sales Corp. SPCP Group, LLC 478,744 Poof Toy Products Madison Investment Trust 3,934 Rowland Coffee M.D. Sass Re/Enterprise $387,907 Roasters Inc. Portfolio Company, L.P Supreme Distributors Co. M.D. Sass Re/Enterprise 25,678 Portfolio Company, L.P. Schwan's Consumer SPCP Group, LLC 240,279 Brands North America Schwan's Consumer SPCP Group, LLC 116,876 Brands North America Schwan's Bakery, Inc. SPCP Group, LLC 510,795 Weinstein Wholesale SPCP Group, LLC 290,002 Meats, Inc. Debt Acquisition Company of America V, LLC, Amroc Investments, LLC, ASM Capital, L.P., HMAC 1999-PH1 Watauga Center Ltd. Partnership, Redrock Capital Partners, LLC, among others, also purchased claims from various trade vendors. Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc. -- http://www.winn-dixie.com/-- is one of the nation's largest food retailers. The Company operates stores across the Southeastern United States and in the Bahamas and employs approximately 90,000 people. The Company, along with 23 of its U.S. subsidiaries, filed for chapter 11 protection on Feb. 21, 2005 (Bankr. S.D.N.Y. Case No. 05-11063). The Honorable Judge Robert D. Drain ordered the transfer of Winn-Dixie's chapter 11 cases from Manhattan to Jacksonville. On April 14, 2005, Winn- Dixie and its debtor-affiliates filed for chapter 11 protection in M.D. Florida (Case No. 05-03817 to 05-03840). D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King & Spalding LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $2,235,557,000 in total assets and $1,870,785,000 in total debts. (Winn-Dixie Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service, Inc., 215/945-7000). * John Bambach Joins NachmanHaysBrownstein as Managing Director --------------------------------------------------------------- John Bambach, Jr., has joined NachmanHaysBrownstein, Inc., as Managing Director in the Philadelphia, PA office. Prior to joining NHB, Mr. Bambach was a director in the Restructuring and Insolvency Group of Parente Randolph, a leading regional accounting and consulting services firm. His experience there included leading out of court restructurings, assisting start-up businesses, supporting restoration of profitability and serving as financial advisor and strategist to debtors and creditors in bankruptcy proceedings, including recently as Financial Advisor to the Debtor in Re Harry F. Ortlip Company. Previously, Mr. Bambach served as interim CEO of a publishing company, founded VisionTel, an award-winning telecom start-up and served as Chairman and CEO of Integrated Telecommunications Corp. He began his career an investment banker with E.F. Hutton, now part of American Express. John Bambach, Jr. is an Adjunct Faculty Member of New York Institute of Technology's Ellis Graduate School, where he teaches Corporate Finance and Economics. He holds an MBA degree from NYIT (Ellis) and a BA degree from LaSalle University. NachmanHaysBrownstein, Inc., is one of the country's leading turnaround and crisis management firms, having been included among the "Top Twelve Turnaround Firms" in Turnarounds & Workouts for the past ten consecutive years. * NachmanHaysBrownstein Elects Jason Consoli as Managing Director ---------------------------------------------------------------- Jason Consoli has been promoted to Managing Director in the Atlanta, Georgia office of NachmanHaysBrownstein, Inc. He brings over ten years experience in both distressed and traditional banking, as well as in sales and sales management to his new role in the firm. Jason Consoli earned his M.B.A. in Finance from the Goizueta School of Business at Emory University, and a B.S. in Business Management at San Diego State University. In addition, he is a Chartered Financial Analyst and a member of the Turnaround Management Association. NachmanHaysBrownstein, Inc. is one of the country's leading turnaround and crisis management firms, having been included among the "Top Twelve Turnaround Firms" in Turnarounds & Workouts for the past ten consecutive years. * TMA Launches Programs to Assist Businesses Hit by Katrina ----------------------------------------------------------- When estimates of the Katrina devastation and the probable loss of half the small businesses in the Gulf Coast region hit the news, the members of the Turnaround Management Association began to equate what needed to be done with what they do every day -- help companies in deep distress get back on their feet. The next few weeks were spent researching the real situation and how best to help. Members of the TMA Louisiana chapter reported a chaotic scenario: poor communications, missing employees, damaged or destroyed facilities, extreme difficulties in reaching government agencies, slow response in getting promised start-up cash, bureaucratic and political barriers, and poor leadership overall. "Virtually every business is in crisis; many of which have been healthy companies until now. Few know how to restore their operations and most bankers need help working out loans," said Hank Arnold, Louisiana Chapter President, whose Baker Donelson Bearman Caldwell & Berkowitz offices in New Orleans have relocated to Baton Rouge. Four weeks later, at the Oct. 20 opening session of the Turnaround Management Association, Chairman Ward Mooney announced TMAssist, a public service program that includes a series of free workshops for small business owners and bankers, educational materials and an online resource center. With all volunteer faculty members and in-kind and monetary donations by TMA's 34 Chapters, TMA hopes to launch its first workshop within a few weeks if resources from local business and governmental groups can be arranged. "This will take a massive volunteer effort and we will have to think out of the box in developing our resources and educational materials. This is not your textbook turnaround," said Jim Matthews, TMA vice president of public affairs. "But our members are dedicated to corporate renewal and these kinds of challenges are what gets their adrenalin flowing." Matthews, past Louisiana Chapter president Rick Blum, who is president of Kingsley Consulting Group Ltd, and Jim Ross, chair of the TMAssist committee and principal in Morris-Anderson & Associates Ltd in Chicago, took their case to the Chapter President's Council on Oct. 19 and reported an overwhelming response of support. The Chapter Resource and Response Council approved a $10,000 allocation for the workshops. Turnaround Management Association - http://www.turnaround.org/-- is the only international non-profit association dedicated to corporate renewal and turnaround management. With international headquarters in Chicago, TMA's 7000 members in 34 regional chapters comprise a professional community of turnaround practitioners, attorneys, accountants, investors, lenders, venture capitalists, appraisers, liquidators, executive recruiters and consultants. * Large Companies with Insolvent Balance Sheets ----------------------------------------------- Total Shareholders Total Working Equity Assets Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------------ ------- -------- ACCO Brands Corp ABD (28) 878 (364) Abraxas Petro ABP (43) 106 (5) AFC Enterprises AFCE (44) 216 52 Alliance Imaging AIQ (52) 621 43 Amazon.com Inc. AMZN (64) 2,601 782 AMR Corp. AMR (615) 29,494 (2,230) Atherogenics Inc. AGIX (76) 235 213 Bally Total Fitn BFT (172) 1,461 (290) Biomarin Pharmac BMRN (110) 167 (4) Blount International BLT (220) 446 126 CableVision System CVC (2,430) 10,111 (1,607) CCC Information CCCG (107) 96 20 Centennial Comm CYCL (463) 1,456 85 Choice Hotels CHH (185) 283 (36) Cincinnati Bell CBB (625) 1,891 (18) Clorox Co. CLX (553) 3,617 (258) Columbia Laborat CBRX (12) 18 11 Coley Pharma COLY (5) 71 30 Compass Minerals CMP (81) 667 129 Crown Media HL CRWN (34) 1,289 (130) Deluxe Corp DLX (124) 1,508 (276) Denny's Corporation DENN (260) 494 (73) Domino's Pizza DPZ (574) 420 (21) Echostar Comm DISH (972) 7,281 269 Emeritus Corp. ESC (123) 720 (43) Foster Wheeler FWLT (490) 2,012 (175) Guilford Pharm GLFD (20) 136 60 Graftech International GTI (34) 1,006 264 I2 Technologies ITWO (153) 386 124 ICOS Corp ICOS (57) 243 160 IMAX Corp IMAX (38) 241 27 Immersion Corp. IMMR (11) 46 30 Intermune Inc. ITMN (7) 219 133 Investools Inc. IED (22) 56 (47) Isis Pharm. ISIS (124) 147 46 Kulicke & Soffa KLIC (44) 365 182 Lodgenet Entertainment LNET (69) 283 22 Lucent Tech Inc. LU (70) 16,437 2,517 Maxxam Inc. MXM (681) 1,024 103 Maytag Corp. MYG (95) 2,989 371 McDermott Int'l MDR (140) 1,489 123 McMoran Exploration MMR (61) 407 118 NPS Pharm Inc. NPSP (98) 310 215 ON Semiconductor ONNN (317) 1,170 300 Owens Corning OWENQ (8,225) 7,766 1,391 Primedia Inc. PRM (771) 1,506 16 Qwest Communication Q (2,663) 24,070 1,248 RBC Bearings Inc. ROLL (5) 247 125 Riviera Holdings RIV (27) 216 5 Rural/Metro Corp. RURL (184) 221 18 Rural Cellular RCCC (465) 1,376 30 Ruth's Chris Stk RUTH (49) 110 (22) SBA Comm. Corp. SBAC (50) 857 19 Sepracor Inc. SEPR (201) 1,175 717 St. John Knits Inc. SJKI (52) 213 80 Tiger Telematics TGTL (46) 20 (55) US Unwired Inc. UNWR (76) 414 56 Vector Group Ltd. VGR (33) 527 173 Verifone Holding PAY (36) 248 48 Vertrue Inc. VTRU (48) 447 (96) Weight Watchers WTW (36) 938 (266) Worldspace Inc. WRSP (1,720) 560 (1,786) WR Grace & Co. GRA (605) 3,423 811 ********* 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, Lucilo Pinili, Jr., Tara Marie Martin, 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. *** End of Transmission ***