/raid1/www/Hosts/bankrupt/TCR_Public/051221.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, December 21, 2005, Vol. 9, No. 302
Headlines
AFC ENTERPRISES: Appoints Mel Hope as Chief Financial Officer
ALLSERVE SYSTEMS: Chapter 11 Trustee Taps Sterns as Counsel
ANDROSCOGGIN ENERGY: Court Sets Jan. 5 for Disclosure Hearing
ANDROSCOGGIN ENERGY: Court Approves Compromise Pact With CSFB
ATA AIRLINES: Inks Eighth Amendment to Southwest Credit Pact
ATA AIRLINES: Court Approves Midway Gate Deals with Southwest
AUSTIN COMPANY: Wants Lease Decision Period Stretched to Feb. 11
AUSTIN CO: Court Approves Sale of Assets to AAC Designers
BARTON SPRINGS: Credit Risks Spurs S&P's Negative Watch
BEER GARDEN: Voluntary Chapter 11 Case Summary
BLACK WARRIOR: Completes $52.3 Mil. BobCat Pressure Acquisition
CABLEVISION SYSTEMS: CSC Unit Selling $1 Billion of Senior Notes
CATHOLIC CHURCH: Tucson Formally Incorporates All 74 Parishes
CENTRAL PARKING: Earns $9.6 Million of Net Income in Third Quarter
CHARYS HOLDING: Posts $261,041 Net Loss in Second Quarter
CHASE COMM'L: S&P Raises Rating on Class G Certificates
COIN BUILDERS: Wants to Employ James Spath as Accountant
COIN BUILDERS: Panel Wants Brennan Steil as Bankruptcy Counsel
COLLINS & AIKMAN: Names D. Profitt as Plastics Operations Pres.
COMBUSTION ENG'G: Court Confirms Modified Plan of Reorganization
COOL PARTNERS: Insurers Agree to $8.1 Million Settlement
CP SHIPS: Completes 4% Senior Notes Offer and Consent Solicitation
CSC HOLDINGS: Fitch Withdraws Rating on Proposed $5.5 Bil. Debts
CSK AUTO: S&P Rates $210 Million Senior Exchangeable Notes at B+
D.R. HORTON: Enters into Five-Year $2.15 Billion Credit Facility
DEAN FOODS: S&P Places BB- Debt Rating on Shelf Registration
DELPHI CORP: Defers Filing of Sec. 1113 & 1114 Motions to Feb. 17
DELPHI CORP: Wants to Hire Banner as Intellectual Property Counsel
DELPHI CORP: Wants to Hire Butzel Long as Litigation Counsel
DERIVIUM CAPITAL: Court Converts Case to Chapter 7 Liquidation
DIGITAL LIGHTWAVE: Optel Loan Totals $51.7 Mil. as of Dec. 12
EAGLE FOOD: Unsecured Creditors Receiving Another 2% Distribution
ECOLOCLEAN INDUSTRIES: Equity Deficit Tops $1.2 Mil. at Sept. 30
EDGEWATER FOODS: Lopez Blevins Raises Going Concern Doubt
ESCANABA TIMBER: S&P Withdraws Low-B Debt Ratings
ESPERANZA VILLAGE: Case Summary & 17 Largest Unsecured Creditors
FEDERAL-MOGUL: M&F Subsidiary Expects to Resolve Asbestos Claims
FIRST HORIZON: S&P Raises Low-B Ratings on Two Certificate Classes
FOAMEX INT'L: Court Okays Setoffs with Four Major Creditors
FOAMEX INT'L: Continental & Sealy Wants Automatic Stay Lifted
FOAMEX INT'L: Court Okays Stipulation With Three Utilities
FORD MOTOR: Share Losses Prompts Fitch to Cut Ratings to BB+
GRAFTECH INT'L: Corrado F. De Gasperis Resigns as CFO, VP & CIO
JACOBS INDUSTRIES: Panel Taps Stout Risius as Financial Advisor
JACOBS INDUSTRIES: Beringea LLC Approved as Investment Bankers
KAISER ALUMINUM: Court Okays Liquidation of Four Subsidiaries
KAISER ALUMINUM: Moves for Summary Judgment on Clark Public Claims
KENNETH MEAD: Court Sets Jan. 16 as General Claims Bar Date
KNIGHT FULLER: Incurs $11.6MM Net Loss in Quarter Ended Sept. 30
KOEN BOOK: Court Okays Goldman Walker as Collection Agent
KULLMAN INDUSTRIES: Taps BDO Seidman as Accountants & Advisors
KULLMAN INDUSTRIES: Taps Trenwith Securities as Investment Bankers
KUSHNER-LOCKE: Can Access Lenders' Cash Collateral Until May 31
LAFOURCHE PARISH: Tax Revenue Decline Cues S&P to Cut Rating to BB
LEGACY ESTATE: U.S. Trustee Appoints 10-Member Creditors Committee
LEVITZ HOME: Closes and Liquidates Thirty-Four Stores
MCI INC: Five Parties Balk at Verizon Common Stock Distribution
MIRANT CORP: Names Terry G. Dallas to Board of Directors
MORGAN STANLEY: Fitch Affirms Low-B Ratings on $31MM Class Certs.
NEW BETTER: Case Summary & 20 Largest Unsecured Creditors
NORTHWEST: PFAA Urges Steenland to Sign "Airline Bill Of Rights"
NORTHWEST AIRLINES: O'Keiffe Wants Stay Lifted to Pursue Lawsuit
NORTHWEST AIRLINES: Delivers Settlement Offer to AMFA Members
NORTHWEST PARKWAY: S&P Junks Rating on $52.5MM Subordinate Bonds
NORTHWESTERN CORP: S.D. Judge Denies Move to Halt Director Actions
OMNICARE INC: Raising $2.37 Bil. to Repay Loan & Buy Back Notes
PACIFIC MAGTRON: Disclosure Statement Hearing Set on December 23
PATHMARK STORES: Weak Credit Metrics Prompt S&P's B- Rating
PENN TRAFFIC: Has Until Mar. 31 to Finalize Financial Reports
PEP BOYS: Wachovia Arranging $200 Million Senior Secured Facility
PGCC INC: Ontario Court Authorizes KPMG to Sell Paris Grand
PHARMACEUTICAL FORMULATIONS: Taps Grant Thornton as Accountants
PHILLIP GEERTSON: Case Summary & 20 Largest Unsecured Creditors
PHOTOCIRCUITS CORP: Wants to Obtain $7.33 DIP Loan from Stairway
PIER 1: Weak Operating Results Prompt S&P's Negative Watch
POLAROID CORP: Administrator's Final Report Due by January 16
REFCO INC: Appoints Harrison J. Goldin as Chief Executive Officer
RESI FINANCE: S&P Assigns Low-B Ratings to $58.9MM Class B Certs.
RICHARD DURAND: Case Summary & 2 Largest Unsecured Creditors
RUFUS INC: Files Plan and Disclosure Statement in Delaware
SALS 2004-A: Credit Risks Prompt S&P's Negative Watch
SALT CREEK: Credit Risks Prompt S&P's Negative Watch
SANITARY & IMPROVEMENT: U.S. Trustee Appoints 4-Member Committee
SAV-ON LTD: Files Schedules of Assets and Liabilities
SAV-ON LTD: U.S. Trustee Appoints 5-Member Creditors Committee
SAV-ON LTD: Section 341(a) Meeting Slated for December 29
SIGNUM FINANCE: Credit Risks Spur S&P's Negative Watch
SNRG CORP: Losses Continue in Quarter Ended September 30
STONE ENERGY: Lenders Extend Financial Reporting Waiver to Mar. 31
STRUCTURED ASSET: Fitch Junks Ratings on Class B5 Certificates
SUN HEALTHCARE: Court Enters Final Decree Closing Bankruptcy Case
T.A.T. PROPERTY: Todtman Nachami Approved as Bankruptcy Counsel
TRUMP ENT: Board Approves $110 Mil. CapEx Plan for 2006 to 2007
TRUMP ENT: Holdings May Draw on Term B-2 Facility Until Nov. 2006
U.S. INVESTIGATIONS: $150M Loan Plan Spurs S&P's Negative Outlook
UAL CORPORATION: Files 21st Reorganization Status Report
UAL CORP: Confirmation Objections to Amended Chapter 11 Plan
UNIFLEX INC: Court Confirms Amended Joint Liquidation Plan
UNITED WOOD: Gets Okay to Hire Walker Warren as Special Counsel
WCI STEEL: Settles Seaways $405,588 Maritime Lien Claim
WESTLIN CORPORATION: Court Confirms Ch. 11 Plan of Reorganization
WESTSIDE LOFTS: Case Summary & 19 Largest Unsecured Creditors
WINN-DIXIE: Files First Quarter Financial Results for Fiscal 2006
WORLDCOM INC: Court Orders $2,070,000 Escrow Disbursed to MCI
*********
AFC ENTERPRISES: Appoints Mel Hope as Chief Financial Officer
-------------------------------------------------------------
AFC Enterprises, Inc. (Nasdaq: AFCE) appointed Mel Hope as Chief
Financial Officer effective Dec. 19, 2005. Mr. Hope, who was
previously Chief Accounting Officer and Senior Vice President of
AFC and Chief Financial Officer of its Popeyes division, succeeds
Frederick B. Beilstein who resigned from his position as AFC's
Chief Financial Officer as the Company completed its divestitures
and transition of AFC's multi-brand corporate center to a single
brand operations company.
Mr. Hope, age 44, joined AFC in 2003 as Vice President, Finance.
In 2005, Mr. Hope was named Senior Vice President of AFC and Chief
Financial Officer for Popeyes Chicken & Biscuits, assuming
responsibility for all brand finance initiatives while continuing
to oversee AFC accounting and finance functions. Since joining
AFC, Mr. Hope has played a key role managing AFC's public company
responsibilities and also transitioning the finance, information
technology, and outsourcing agreements to the Company's single
brand model. Prior to joining the Company, Mr. Hope was the Chief
Financial Officer of First Cambridge HCI Acquisitions LLC, a real
estate investment firm. Prior to that, Mr. Hope was a partner
with PricewaterhouseCoopers LLP specializing in Accounting and
Business Advisory Services. Mr. Hope holds a Bachelor's degree in
Business Administration-Accounting from Belhaven College, where he
graduated with honors. Mr. Hope reports directly to Ken Keymer,
AFC's Chief Executive Officer and Popeyes President.
Ken Keymer stated, "Mel's extensive public and private finance
experiences, coupled with his proven commitment to our business,
have prepared him well to lead the finance activities for AFC.
Mel is a valuable component of the AFC team that we have assembled
to lead the Company into the future."
After 2 years overseeing financial matters for AFC, Mr. Beilstein
resigned his position effective Dec. 19, 2005 to become a Managing
Partner of Equicorp Partners, LLC, an Atlanta based investment and
advisory services firm. During Mr. Beilstein's tenure, he has
been instrumental in driving and implementing the divestiture of
the Company's Church's Chicken(TM) and Cinnabon(R) businesses and
the transition of AFC to a standalone Popeyes business.
"Fred has been an integral partner in our efforts to drive value
for AFC and all our stakeholders. His extensive experience and
commitment to the overall business for the Company has benefited
AFC tremendously," stated AFC Chairman Frank Belatti.
AFC Enterprises, Inc. -- http://www.afce.com/-- is the franchisor
and operator of Popeyes(R) Chicken & Biscuits, the world's second-
largest quick-service chicken concept based on number of units.
As of Nov. 27, 2005, Popeyes had 1,802 restaurants in the United
States, Puerto Rico, Guam and 25 foreign countries. AFC has a
primary objective to be the world's Franchisor of Choice(R) by
offering investment opportunities in its Popeyes Chicken &
Biscuits brand and providing exceptional franchisee support
systems and services.
At Oct. 2, 2005, AFC Enterprises, Inc.'s balance sheet showed a
$44.2 million stockholders' deficit compared to $140.9 million of
positive equity at Dec. 26, 2005.
ALLSERVE SYSTEMS: Chapter 11 Trustee Taps Sterns as Counsel
-----------------------------------------------------------
Bunce Atkinson, Esq., the chapter 11 Trustee of Allserve Systems
Corp., asks the U.S. Bankruptcy Court for the District of New
Jersey for authority to employ Sterns & Weinroth, P.C., as his
counsel, nunc pro tunc to Dec. 12, 2005.
The Trustee needs Sterns & Weinroth to represent him in fulfilling
his duties and to represent him in any litigation or contested
matters involving the Debtor's estate.
Mr. Atkinson chose Sterns & Weinroth because of the firm's
expertise in insolvency law, particularly in bankruptcy
proceedings in New Jersey.
Simon Kimmelman, Esq., will be the lead attorney for Mr. Atkinson.
Mr. Kimmelman charges $350 an hour.
A list of Sterns & Weinroth's professionals and their current
hourly billing rates is available free of charge at:
http://bankrupt.com/misc/Sterns_BillingRates.pdf
To the best of the Trustee's knowledge, Sterns & Weinroth is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Headquartered in North Brunswick, New Jersey, Allserve Systems
Corp. is an outsourcing company for the IT industry. The Debtor
filed for chapter 11 protection on November 18, 2005 (Bankr. D.
N.J. Case No. 05-60401). Barry W. Frost, Esq., at Teich Groh
represents the Debtor in its restructuring efforts. When the
Debtor filed for protection from its creditors, it estimated
assets between 10 million to $50 million and debts between $50
million to $100 million.
ANDROSCOGGIN ENERGY: Court Sets Jan. 5 for Disclosure Hearing
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maine will convene a
hearing on Jan. 5, 2006, to consider the adequacy of information
contained in Androscoggin Energy LLC's Disclosure Statement
explaining its Plan of Reorganization.
The Plan calls for the payment of all valid claims via the
distribution of the Debtor's existing cash and the issuance of
100% of new membership interests in the Reorganized Debtor to
Calpine Northbrook Corporation of Maine, Inc.
The Debtor's remaining principal assets consist of approximately
$44.2 million in cash and the cogeneration facility.
Pursuant to the Plan, a $2.5 million working capital reserve will
be set up to pay operating expenses and other liabilities of the
reorganized Debtor associated with the ownership and maintenance
of the cogeneration facility after the effective date.
Treatment of Claims
All allowed secured claims of CSFB arising from the Credit
Agreement will be paid in full on the earlier of the effective
date of the Plan or March 30, 2006.
The secured tax claims of the Town of Jay will be paid in full on
the effective date.
Holders of allowed unsecured claims not classified under the Plan
will receive a pro rata share of the Plan Cash and a pro rata
share of the amount, if any, by which the International Paper
Reserve exceeds the International Paper cure amount.
The International Paper Reserve means an amount equal to the
greater of:
a) the amount distributable on account of all claims of
International Paper arising out of the rejection of any
executory contract or unexpired lease, assuming that the
ESA and the IP Lease are not assumed pursuant to the
Plan; or
b) $10 million payable on or before the effective date.
Calpine Northbrook will receive new membership interests in the
reorganized debtor in exchange for all of its allowed unsecured
claims.
Existing membership interests will be cancelled on the effective
date and interest holders get nothing under the Plan.
A full-text copy of the Debtor's Plan of Reorganization is
available for a fee at:
http://www.researcharchives.com/bin/download?id=051007204539
Headquartered in Boston, Massachusetts, Androscoggin Energy LLC,
owns, operates, and maintains an approximately 150-megawatt,
natural gas-fired cogeneration facility in Jay, Maine. The
Company filed for chapter 11 protection on November 26, 2004
(Bankr. D. Me. Case No. 04-12221). Michael A. Fagone, Esq., at
Bernstein, Shur, Sawyer & Nelson represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed total assets of $207,000,000 and total
debts of $157,000,000.
ANDROSCOGGIN ENERGY: Court Approves Compromise Pact With CSFB
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maine approved
Androscoggin Energy LLC's Compromise Agreement with Credit Suisse
First Boston, as Agent for the benefit of the Senior Lenders, with
respect to the lenders' claim for default interest and certain
other charges under 11 U.S.C. Section 506(b).
The Court approved the compromise on Dec. 13, 2005.
On June 28, 2005, the Debtor filed an Objection (Doc. 512) to
Credit Suisse First Boston and the Secured Lenders' claims for
Default Interest and other Charges and Motion to Value Claim of
Credit Suisse First Boston and the Secured Lenders.
On Aug. 1, 2005, Credit Suisse filed its Response (Doc. 582) to
the Debtor's objection.
The Debtor and Credit Suisse eventually entered into a Compromise
Agreement to settle their dispute.
Summary of the Compromise Agreement
1) The Debtor will pay Credit Suisse, as Agent for the Senior
Lenders, $750,000 by Dec. 20, 2005, to be paid out of the
Escrow Funds, as that term is defined in the Court's Consent
Motion to Modify Cash Collateral Order.
2) The Debtor will pay Credit Suisse, as Agent for the Senior
Lenders, $400,000 out of the Escrow Funds by the earlier of
a) the effective date of the Debtor's Plan of Reorganization
dated Sept. 30, 2005, or
b) March 31, 2006, and the payments provided in paragraphs 1
and 2 will result in full payment of the remaining claims
of CSFB, as Agent for the benefit of the Senior Lenders,
against the Debtor and the estate.
3) The Debtor's objection to amounts claimed by and paid to CSFB
for professional, consulting and other fees and expenses
will be withdrawn with prejudice.
4) All pending invoiced fees incurred by CSFB and submitted to
the Debtor prior to Dec. 12, 2005, will be paid out of the
Escrow Funds within five business days of the date of entry
of the Court's approval of the Stipulation Order for the
Compromise Agreement.
5) the Debtor will pay all reasonable future fees of CSFB's
professionals as they relate to the Debtor's bankruptcy case,
including fees related to plan confirmation.
5) CSFB, upon payment of the amounts in paragraphs 1-5, will
release the remainder of the Escrow Funds to the Debtor with
the exception of $75,000 to be used to pay CSFB's reasonable
expenses to close out the Debtor's credit facility and
anticipated Agent fees under the Credit Agreement accruing
through March 31, 2006.
Headquartered in Boston, Massachusetts, Androscoggin Energy LLC,
owns, operates, and maintains an approximately 150-megawatt,
natural gas-fired cogeneration facility in Jay, Maine. The
Company filed for chapter 11 protection on November 26, 2004
(Bankr. D. Me. Case No. 04-12221). Michael A. Fagone, Esq., at
Bernstein, Shur, Sawyer & Nelson represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed total assets of $207,000,000 and total
debts of $157,000,000.
ATA AIRLINES: Inks Eighth Amendment to Southwest Credit Pact
------------------------------------------------------------
As part of the Midway Gate Restructuring Transaction approved by
the U.S. Bankruptcy Court for the Southern District of Indiana,
ATA Airlines, Inc., its debtor-affiliates and Southwest Airlines
Co. executed an eighth amendment to their DIP Credit Agreement on
December 12, 2005.
The Eighth Amendment acknowledges the Debtors' entry into credit
facilities with MatlinPatterson Global Opportunities Partners II,
L.P.
The Debtors and Southwest also agree to extend the Maturity Date
of the Southwest Facility on the earliest of (a) February 28,
2006, (b) the date of termination in whole of the Commitments, and
(c) the effective date of a Reorganization Plan for the
Reorganizing Debtors.
Upon Court approval of the Midway Gate Restructuring Transaction,
the outstanding balance of the Loan will be reduced by
$20,000,000
The Debtors covenant with Southwest not to:
-- permit Consolidated EBITDARR for each calendar month
beginning on November 1, 2005, and ending with February 28,
2006, to be less than 75% of the projected EBITDARR for
each month as derived from the Disclosure Statement
Financial Projections; nor
-- permit cumulative Consolidated EBITDARR for each month
beginning on November 1, 2005, and ending on February 28,
2006, to be less than 80% of the cumulative Consolidated
EBITDARR for each calendar month as set forth in the
Disclosure Statement Financial Projections.
The Debtors also covenant with Southwest not to:
-- permit Adjusted EBITDARR for each month beginning on
November 1, 2005, and ending with February 28, 2006, to be
less than 75% of the projected Adjusted EBITDARR for each
month as derived from the Disclosure Statement Financial
Projections; nor
-- permit cumulative Adjusted EBITDARR for each month
beginning on November 1, 2005, and ending on February 28,
2006, to be less than 80% of the cumulative Adjusted
EBITDARR for each month as derived from the Disclosure
Statement Financial Projections.
The Debtors also will not permit Liquidity on any day during the
calendar months beginning November 1, 2005, through February 28,
2006, to be less than 75% of the projected Liquidity for the last
day of each calendar month as set forth in the Disclosure
Statement Financial Projections with respect to ATA Holdings and
its Subsidiaries, including ATA Airlines, on a consolidated
basis."
The Reorganizing Debtors may obtain confirmation of a Plan which
is effective not later than February 28, 2006.
The parties also agree to amend the Southwest Bid and related
documents so that Southwest's commitment to provide the Southwest
Equity Investment is terminated upon the receipt by the
Reorganizing Debtors of the Exit Financing from MatlinPatterson.
A full-text copy of the Eighth Amendment and the amendment to the
Southwest Bid is available at no charge at:
http://bankrupt.com/misc/southwest8thDIPAmendment.pdf
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. 43; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
ATA AIRLINES: Court Approves Midway Gate Deals with Southwest
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana
approved the Midway Gate Restructuring Transaction, the Amended
Codeshare Agreement Term Sheet, and the amendments to the
Southwest DIP Loan Agreement in all respects. ATA Airlines is
authorized to assign and transfer to all of its rights, title and
interests in the Midway Premises as provided in the Amended Gate
Restructuring Term Sheet.
ATA is authorized to pay to Southwest $1,000,000 as expense
reimbursement upon the funding of the MatlinPatterson DIP
Facility.
Settlement with ATSB Lenders
Judge Lorch also approves a settlement agreement between the
Reorganizing Debtors, the ATSB Lenders, and Southwest to settle
the ATSB Lenders' objection to the Midway Gate Restructuring
Agreement.
The ATSB Lenders assert that the consummation of the Midway Gate
Transfer prior to the effective date of the Reorganizing Debtors'
plan of reorganization would violate various provisions of the
Cash Collateral Order and prejudice certain of the ATSB Lenders'
rights and protections. The International Lease Finance
Corporation supported the ATSB Objection.
Under the Settlement Agreement, the ATSB Lenders will withdraw the
Objection and support the consummation of the Midway Gate Transfer
prior to the Effective Date.
In the event that:
(a) the Midway Gate Transfer is consummated on or before
December 31, 2005;
(b) the Effective Date does not occur before June 30, 2006;
(c) there is either (i) a liquidation of the Debtors whether
under Chapter 7 or Chapter 11 of the Bankruptcy Code or
following a dismissal of the Chapter 11 Cases of the
Reorganizing Debtors or (ii) an alternate plan of
reorganization is consummated; and
(d) either (i) the ATSB Lenders recover less than the ATSB
Secured Claim after the liquidation of substantially all
the Collateral or (ii) an Alternate Plan provides the ATSB
Lenders with a recovery the appraised value of which is
less than the then outstanding amount of the ATSB Secured
Claim,
Southwest will, on behalf of the Reorganizing Debtors, pay to the
Agent for the benefit of ATSB Lenders in respect of the ATSB
Secured Claim the lesser of (a) $15,000,000 and (b) the remaining
amount of the ATSB Secured Claim to the extent of the Collateral
Diminution found by the Court or other court of competent
jurisdiction in a final and non-appealable order. In addition,
the outstanding principal amount of the Southwest DIP Loan will be
increased by the amount of the Southwest Payment.
In the event that, after recovering the entire amount of the ATSB
Secured Claim including the Southwest Payment, the ATSB Lenders
receive any payments from the liquidation of Collateral, the ATSB
Lenders will promptly pay any excess amounts first to Southwest.
In the event the Midway Gate Transfer has not been consummated by
December 31, 2005, the Settlement Agreement will become null and
void.
A full-text copy of the Settlement Agreement is available at no
charge at:
http://bankrupt.com/misc/ATSBtransfersettlementpact.pdf
A full-text copy of the Court Order approving the Debtors' request
is available at no charge at:
http://bankrupt.com/misc/MidwayRestructuringOrder.pdf
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. 43; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
AUSTIN COMPANY: Wants Lease Decision Period Stretched to Feb. 11
----------------------------------------------------------------
The Austin Company and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Northern District of Ohio to extend until
February 11, 2006, the period within which they can assume, assume
and assign or reject unexpired nonresidential real property
leases.
Since the Debtors filed for bankruptcy, they have focused their
efforts on resolving issues with sub-contractors and marketing the
business to perspective buyers. During the next 30 days, the
Debtors expect their time will be consumed by activities related
to the sale proceedings.
As a result, the Debtors have been unable to:
a) thoroughly evaluate leases,
b) determine which of the leases will contribute to the
Debtors' future operations, or
c) solicit the views of the Official Committee of Unsecured
Creditors regarding the appropriate treatment of leases.
Accordingly, the extension will allow the Debtors to analyze which
leases need to be assumed or rejected.
Headquartered in Cleveland, Ohio, The Austin Company is an
international firm offering a comprehensive portfolio of in-house
architectural, engineering, design-build, construction management
and consulting services. The Company also offers value-added
strategic planning services including site location,
transportation and distribution consulting, and facility and
process audits. The Company and two affiliates filed for chapter
11 protection on Oct. 14, 2005 (Bankr. N.D. Ohio Lead Case No. 05-
93363). Christine M. Pierpont, Esq., at Squire, Sanders &
Dempsey, LLP, represents the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they estimated between $10 million to $50 million in
total assets and debts.
AUSTIN CO: Court Approves Sale of Assets to AAC Designers
---------------------------------------------------------
Austin Company and its debtor-affiliates sought and obtained
permission from the U.S. Bankruptcy Court for the Northern
District of Ohio, Eastern Division, to sell substantially all of
their assets to AAC Designers Builders, Inc., for $2.5 million.
In Jan. 2005, AECOM Technology Corporation bought the Debtors'
Chicago and Houston offices and established AAC Designers.
Headquartered in Cleveland, Ohio, The Austin Company is an
international firm offering a comprehensive portfolio of in-house
architectural, engineering, design-build, construction management
and consulting services. The Company also offers value-added
strategic planning services including site location,
transportation and distribution consulting, and facility and
process audits. The Company and two affiliates filed for chapter
11 protection on Oct. 14, 2005 (Bankr. N.D. Ohio Lead Case No. 05-
93363). Christine M. Pierpont, Esq., at Squire, Sanders &
Dempsey, LLP, represents the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they estimated between $10 million to $50 million in
total assets and debts.
BARTON SPRINGS: Credit Risks Spurs S&P's Negative Watch
-------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on 35
classes from 18 U.S. synthetic CDO transactions on CreditWatch
with negative implications. When combining pari passu tranches,
the 35 ratings represent 25 credit classes.
The CreditWatch placements are due to an update of Standard &
Poor's credit opinion regarding the risks associated with the
credit behavior of non-investment-grade entities. In addition,
S&P's assessment of how that behavior is correlated also has been
updated. The updated assumptions have been incorporated into
Standard & Poor's CDO Evaluator model, the latest version of which
was released for global synthetic CDO transactions.
Standard & Poor's expects to resolve the CreditWatch placements on
the affected ratings within 90 days and either lower or affirm the
rating assigned to each tranche. In the interim, Standard &
Poor's will work with arrangers to gather additional information
on the affected transactions, especially those that may be
restructured during this period. Absent any changes in the
transactions during the CreditWatch period, the most severe rating
action taken among the affected tranches would be a three-notch
downgrade. Barring any changes in the affected tranches,
approximately half of the potential actions would be one-notch
downgrades, and the remaining actions would be split evenly
between two- and three-notch downgrades.
The 35 tranches with ratings placed on CreditWatch negative
represent approximately 4% of Standard & Poor's total publicly
rated U.S. synthetic CDO tranches.
Ratings Placed On Creditwatch Negative
Archstone I PLC
Rating
Class To From
----- -- ----
2005-C1 A/Watch Neg A
2005-C2 A/Watch Neg A
Barton Springs CDO SPC Series 2005-1 SEG
Rating
Class To From
----- -- ----
D-1 BB+/Watch Neg BB+
D-2 BB+/Watch Neg BB+
Blue Point CDO SPC Series 2005-1
Rating
Class To From
----- -- ----
C-1 A/Watch Neg A
C-2 A/Watch Neg A
D-1 BBB/Watch Neg BBB
D-2 BBB/Watch Neg BBB
Blue Point CDO SPC Series 2005-2
Rating
Class To From
----- -- ----
C A/Watch Neg A
D BBB/Watch Neg BBB
Morgan Stanley ACES SPC Series 2005-14
Rating
Class To From
----- -- ----
II secured AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-15
Rating
Class To From
----- -- ----
II secured AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-18
Rating
Class To From
----- -- ----
SFRN AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-22
Rating
Class To From
----- -- ----
Notes AAA/Watch Neg AAA
SALS 2004-A
Rating
Class To From
----- -- ----
F1 BB/Watch Neg BB
F2 BB/Watch Neg BB
Salt Creek High Yield CSO 2005-1 Ltd.
Rating
Class To From
----- -- ----
A-4$L AA-/Watch Neg AA-
A-6 A/Watch Neg A
A-6EL-1 A/Watch Neg A
A-6EL A/Watch Neg A
A-7 A-/Watch Neg A-
B-2 BBB/Watch Neg BBB
B-3$L BBB-/Watch Neg BBB-
B-5 BB/Watch Neg BB
B-6$L BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-5
Rating
Class To From
----- -- ----
E BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-7
Rating
Class To From
----- -- ----
Combo notes BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-12
Rating
Class To From
----- -- ----
E BB-/Watch Neg BB-
Strata 2004-8 Ltd.
Rating
Class To From
----- -- ----
Floating rate notes BBB/Watch Neg BBB
Strata 2005-19 Ltd. Floating Rate Notes
Rating
Class To From
----- -- ----
FRN BBB-/Watch Neg BBB-
Sunset Park CDO Ltd. SPC Series 2004-4
Rating
Class To From
----- -- ----
B A-/Watch Neg A-
Sunset Park CDO Ltd. SPC Series 2005-5
Rating
Class To From
----- -- ----
B AA/Watch Neg AA
Sunset Park CDO-M Ltd. SPC Series 2005-3 SEG
Rating
Class To From
----- -- ----
D-1 AA-/Watch Neg AA-
D-2 AA-/Watch Neg AA-
E A-/Watch Neg A-
BEER GARDEN: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: The Beer Garden, Inc.
dba Roxy
515 West 18th Street
New York, New York 10011-2822
Bankruptcy Case No.: 05-60194
Type of Business: The Debtor owns and operates a nightclub and
disco in New York City known as the Roxy and is
a world renown gay institution. The Debtor is
an affiliate of 2427 Restaurant Corp. dba
Eugene's and Gypsy Tea, which filed for
bankruptcy protection on Oct. 16, 2005 (Bankr.
S.D.N.Y. Case No. 05-48722)(J. Bernstein).
Chapter 11 Petition Date: December 19, 2005
Court: Southern District of New York (Manhattan)
Judge: Stuart M. Bernstein
Debtor's Counsel: Kenneth M. Lewis, Esq.
Sanford Philip Rosen, Esq.
Sanford P. Rosen & Associates, P.C.
747 Third Avenue
New York, New York 10017-2803
Tel: (212) 223-1100
Fax: (212) 223-1102
Total Assets: $1 Million to $10 Million
Total Debts: $1 Million to $10 Million
The Debtor did not file a list of its 20 largest unsecured
creditors.
BLACK WARRIOR: Completes $52.3 Mil. BobCat Pressure Acquisition
---------------------------------------------------------------
Black Warrior Wireline Corp. (OTC Bulletin Board: BWWL) completed
the acquisition of BobCat Pressure Control, Inc. The acquisition
was effected as the purchase of all of the outstanding equity
securities of BobCat from the holders for a purchase price of
approximately $52.3 million, including related fees and expenses
and repayment of substantially all BobCat indebtedness. In
addition, Black Warrior entered into a non-competition agreement
with Bobby Joe Cudd and employment agreements with key employees
of BobCat.
Amended Credit Agreement
The purchase price was paid in cash at the closing of the
acquisition out of borrowings under an amended and restated senior
lien credit agreement and a second lien credit agreement entered
into concurrently with the closing of the BobCat acquisition with
General Electric Capital Corporation, as lender and agent for
lenders.
Simmons & Company International acted as financial advisors to
Black Warrior in the acquisition of BobCat.
Black Warrior's amended and restated senior lien credit agreement
with General Electric Capital Corporation provides for a three-
year, $50.0 million senior secured credit facility consisting of:
* a working capital revolving loan facility of up to
$15 million,
* a term loan totaling $30 million, and
* a one-year capital expenditure loan facility of up to
$5 million.
The proceeds of the term loan borrowing were used to pay a portion
of the BobCat transaction purchase price and to repay certain
existing Black Warrior debt and for general corporate purposes.
This new senior secured debt facility replaces the expiring senior
secured debt facility with General Electric Capital Corporation.
Second Lien Credit Facility
In addition to the senior secured credit facility, Black Warrior
entered into a second lien credit facility with General Electric
Capital Corporation pursuant to which it borrowed $25 million, the
proceeds of which were used to fund a portion of the BobCat
acquisition. The loan matures and is due and payable on March 16,
2009, subject to certain mandatory pre-payments. The loan is
secured by a second lien on all of Black Warrior's assets.
Concurrently with the borrowings under the credit facilities, the
maturity date of approximately $21.9 million principal amount of
Black Warrior's subordinated secured debt was extended to June 15,
2009 and $2.1 million of such subordinated debt, including accrued
interest, was repaid. No interest or principal payments on the
remaining outstanding subordinated debt are permitted until the
senior secured loans mature or are repaid. The maturity date of
the subordinated debt was extended from Feb. 13, 2008.
About BobCat Pressure Control Inc.
BobCat Pressure Control, Inc., provides well intervention services
to natural gas and oil exploration and production companies.
These services are primarily hydraulic workover services, commonly
known as "snubbing," which permit an operator of a well to repair
damaged casing, production tubing and downhole production
equipment in high pressure, "live well" environments. BobCat also
provides wellhead freezing services, hot tapping well access
services, and rental tool services. BobCat's services are
provided throughout the Mid-Continent area of the United States.
About Black Warrior Wireline Corp.
Black Warrior Wireline Corp. is an oil and gas service company
providing services to oil and gas well operators primarily in the
United States and in the Gulf of Mexico. It is headquartered in
Columbus, Mississippi.
* * *
As reported in the Troubled Company Reporter on Nov. 22, 2005,
Black Warrior Wireline Corp. delivered its quarterly report on
Form 10-QSB for the quarter ending September 30, 2005, to the
Securities and Exchange Commission on November 14, 2005.
The Company reported $2,223,728 of net income on $17,421,589
of net revenues for the quarter ending September 30, 2005.
At September 30, 2005, the Company's balance sheet shows
$36,427,947 in total assets and $55,052,978 in total debts.
As of September 30, 2005, the Company's equity deficit narrowed to
$18,625,031 from a $25,208,634 deficit at December 31, 2004.
CABLEVISION SYSTEMS: CSC Unit Selling $1 Billion of Senior Notes
----------------------------------------------------------------
Cablevision Systems Corporation's subsidiary, CSC Holdings, Inc.,
is planning an offering of $1 billion of senior notes to certain
institutional investors in offerings exempt from the registration
requirements of the Securities Act of 1933.
CSC Holdings intends to use the net proceeds from the offering,
together with a portion of the proceeds it receives from
borrowings under a new $4.5 billion credit facility, following the
refinancing of its existing credit facility, to make a
distribution to Cablevision Systems Corporation, which would use
such amounts to pay stockholders a special dividend, if one is
declared by its Board of Directors.
The notes to be offered have not been registered under the
Securities Act of 1933 and may not be offered or sold in the
United States absent registration or an applicable exemption from
registration requirements.
Cablevision Systems Corporation -- http://www.cablevision.com/--
is one of the nation's leading entertainment, media and
telecommunications companies. In addition to its cable, Internet,
and voice offerings, the company owns and operates Rainbow Media
Holdings LLC and its networks; Madison Square Garden and its
teams; and, Clearview Cinemas. In addition, Cablevision operates
New York's Radio City Music Hall.
As of Sept. 30, 2005, Cablevision's equity deficit narrowed to
$2.54 billion from a $2.63 billion deficit at Dec.31, 2004.
CATHOLIC CHURCH: Tucson Formally Incorporates All 74 Parishes
-------------------------------------------------------------
The formal incorporation of all 74 parishes in the Diocese of
Tucson is in process following the filing of signed articles of
incorporation for each parish with the Arizona Corporation
Commission, reports Bob Scala of The New Vision, a monthly
newspaper of the Diocese.
Attorney Gerry O'Meara, the statutory agent for parish
incorporation and diocesan attorney, Father Al Schifano, diocesan
Moderator of the Curia, and Kathy Rhinehart, executive assistant
for corporate affairs, hand-delivered the documents to the ACC's
Tucson office. ACC staff member Nanette Brantly stamped each set
of articles with the filing date of November 15, 2005.
Mr. Scala is a parishioner of Our Mother of Sorrows Parish in
Tucson. He is the chairman of the Diocesan Pastoral Council, and
serves on the Parish Incorporation Committee.
The remaining steps for incorporation include the publication of
the articles in a "newspaper of record" in the county where the
parish is located. A document that includes a copy of the actual
newspaper publication confirming that the Articles were published
then will be filed with the ACC.
Publication of the Articles and filing of the confirmation of
publication are expected to be completed by early January 2006.
When it receives each parish's confirmation of publication, the
ACC will declare the parish incorporated retroactive to
November 15, 2005.
The first meeting of each parish's board of directors -- the
organizational meeting -- will take place on January 19 and 20,
2006, in Cathedral Hall at St. Augustine Cathedral. Parish by
parish, each pastor and the two lay members of the board will meet
with Bishop Gerald F. Kicanas and Father Al Schifano.
According to Mr. Scala, this first board meeting will be very
brief, with the first business being the nomination and election
of a secretary and treasurer, positions that are held by the two
lay members of each board. The board then will proceed to adopt
the model bylaws, the "Parish Services Agreement" and the
Corporate Resolutions. The final versions of the bylaws, "Parish
Services Agreement" and Corporate Resolutions will be in the hands
of each pastor and the lay members of each board of directors by
early January.
Once the incorporation of the parishes is official, the properties
of the parishes, currently held in trust by the Diocese of Tucson,
will be deeded over to each parish. The transfer of properties
will be the concluding activity for the Parish Incorporation
Process. After that, each parish corporation will be responsible
for meeting its obligations as a corporation in the contexts of
civil law and canon law.
The Roman Catholic Church of the Diocese of Tucson filed for
chapter 11 protection (Bankr. D. Ariz. Case No. 04-04721) on
September 20, 2004, and delivered a plan of reorganization to the
Court on the same day. Susan G. Boswell, Esq., Kasey C. Nye,
Esq., at Quarles & Brady Streich Lang LLP, represent the Tucson
Diocese. (Catholic Church Bankruptcy News, Issue No. 48
Bankruptcy Creditors' Service, Inc., 215/945-7000)
CENTRAL PARKING: Earns $9.6 Million of Net Income in Third Quarter
------------------------------------------------------------------
Central Parking Corporation (NYSE:CPC) reported its financial
results for the fourth quarter and fiscal year ended September 30,
2005. For the fiscal year ended September 30, 2005, earnings from
continuing operations increased to $33.7 million compared with
$18.4 million in fiscal 2004. Net earnings for fiscal 2005 were
$14.2 million compared with $17.0 million in the prior year.
These results include the effect of the Company's restatement of
its quarterly financial statements for the first three quarters of
fiscal 2005 relating to its United Kingdom subsidiary. As
previously announced, the Company became aware during the fourth
quarter of fiscal 2005 of certain unauthorized related party
transactions and improper and inaccurate accounting entries made
by former management level employees in its United Kingdom
subsidiary. The effect of the restatement on the first three
quarters of fiscal 2005 is a reduction in net earnings of
$10 million. As a result of the issues identified in the United
Kingdom, the Company will report material weaknesses in its
controls over financial reporting as of September 30, 2005.
Earnings from continuing operations for the fourth quarter of
fiscal 2005 were $17.9 million compared with $1.1 million in the
year earlier period. Net earnings for the fourth quarter of
fiscal 2005 were $9.6 million compared with a net loss of
$0.9 million in the prior year period.
The Company's program of opportunistic property and lease sales
generated proceeds of $81.5 million during fiscal 2005. Pre-tax
property related gains included in results from continuing
operations for fiscal 2005 totaled $53.6 million. For the fourth
quarter of fiscal 2005, pre-tax property related gains totaled
$38.1 million.
Total revenues in fiscal 2005 increased slightly to $1.1 billion,
while revenues excluding reimbursed management expenses declined
to $669 million compared with $698 million in the prior year due
primarily to the conversion of $15.3 million of revenues,
excluding reimbursed management expenses, from leases to
management agreements.
"Net earnings for fiscal 2005 were negatively affected by the
previously announced issues in the Company's United Kingdom
operations," said Emanuel Eads, President and Chief Executive
Officer. "Excluding the United Kingdom region, net earnings for
fiscal 2005 were $34.3 million. Fourth quarter results also were
negatively affected by $2 million in costs related to the
Company's Sarbanes Oxley compliance initiative and $1.3 million in
increased liability claims costs.
"Our program of opportunistic property sales again was accretive,
generating proceeds during the quarter of $46.1 million that were
used to pay down debt. In total, we reduced indebtedness by
$66.8 million in the fourth quarter. Same store sales, which
increased 1.9% for the full fiscal year, accelerated to 3.0% in
the fourth quarter. Our focus on adding profitable new contracts
yielded positive results during the fourth quarter as we were
awarded a long-term lease to operate EasyPark, a large off-site
airport parking facility serving Los Angeles International
Airport. This contract includes a 425-space garage, a 1,628 space
surface lot as well as 24/7-shuttle service to LAX. In September,
we entered into an agreement to provide valet and shuttle services
for the largest retail mall in the Caribbean, Plaza Las Americas
in San Juan, Puerto Rico. More recently, we renewed an agreement
with improved financial terms to provide parking services for all
pay parking areas within Stanley Park and the Vancouver parks
system, which consists of over 4,000 parking spaces, for a term of
five years.
"We also are making progress in implementing our new strategic
plan, which was announced in August, by moving forward with plans
to divest marginal and low growth markets and expand the Company's
operational excellence initiative. In November, we named industry
veteran Bruce LaPree to lead the Company's national accounts
program. In addition, the Company's "Dutch Auction" tender offer,
which also was announced in August, was successfully completed on
October 14, 2005, with the Company purchasing 4,859,674 shares of
common stock at a purchase price of $15.50 per share for an
aggregate purchase price of $75.3 million.
"Looking ahead to fiscal 2006, we will continue to implement the
new strategic plan, pursue opportunistic property sales and focus
our efforts on adding profitable locations. Based on certain
assumptions, we expect that earnings from continuing operations,
which includes property-related gains/losses, for the fiscal year
ending September 30, 2006, will be in the range of $0.50 to $0.57
per share," Mr. Eads concluded.
The assumptions underlying the financial guidance for fiscal 2006
include:
2006 Assumptions Actual 2005
---------------- -----------
Operating Earnings: Parking $48 - $51 million $47.0 million
Operating Earnings: Management contract $65 - $66 million $56.9 million
Total G & A $82 million $83.2 million
Property-related gains/losses $14 million $53.6 million
Interest (Expense, net and Dividends) $18 million $13.2 million
Depreciation & Amortization $30 million $27.3 million
Effective tax rate 39% 40%
Outstanding Shares 32 million 36.8 million
CapEx $19 - $22 million 12.3 million
Headquartered in Nashville, Tennessee, Central Parking Corporation
is a leading global provider of parking and transportation
management services. As of June 30, 2005, the Company operated
more than 3,400 parking facilities containing more than 1.5
million spaces at locations in 37 states, the District of
Columbia, Canada, Puerto Rico, the United Kingdom, the Republic of
Ireland, Mexico, Chile, Peru, Colombia, Venezuela, Germany,
Switzerland, Poland, Spain, Greece and Italy.
* * *
As reported in the Troubled Company Reporter on Aug. 10, 2005,
Standard & Poor's Ratings Services affirmed its ratings on
Nashville, Tennessee-based Central Parking Corp., including the
company's 'B+' corporate credit and 'BB-' bank loan ratings.
At the same time, the ratings were removed from CreditWatch with
negative implications, where they were placed on March 16, 2005.
The CreditWatch listing followed the company's announcement that
it had engaged Morgan Stanley to assist in pursuing various
strategic alternatives, including the possible sale or
recapitalization of the company. The CreditWatch listing also
reflected Standard & Poor's concern over management turnover
following the resignation of the company's former Chief Financial
Officer.
S&P said the outlook is negative. Total debt outstanding as of
June 30, 2005, was $245 million, excluding operating leases.
CHARYS HOLDING: Posts $261,041 Net Loss in Second Quarter
---------------------------------------------------------
Charys Holding Company, Inc. (OTC Bulletin Board: CHYS)
reported financial results for the three and six months ended
Oct. 31, 2005. For the three months ended Oct. 31, 2005,
consolidated net revenue increased by 306% to $5.2 million as
compared to $1.3 million for the three months ended Oct. 31, 2004.
Increased net revenues for the second fiscal quarter are a direct
result of the inclusion of CCI Telecom, Inc., which was acquired
on March 4, 2005.
For the three months ended Oct. 31, 2005, Charys reported a net
loss of $261,041 as compared to a net profit of $14,373 for the
three months ended Oct. 31, 2004. Revenue gains in the second
quarter were offset by increased expenses associated with the
acquisition of CCI.
For the six months ended Oc. 31, 2005, Charys reported
consolidated revenues increased by 282% to $11.2 million as
compared to revenues of $2,950,011 for the six months ended
Oct. 31, 2004. Net income for the six months ended Oct. 31, 2005
was $939,076 as compared to net income of $131,909 for the six
months ended Oct. 31, 2004.
During the six month period ended Oct. 31, 2005, Charys
decreased its total debt outstanding to $3,582,784 from $5,421,209
at April 30, 2004. Net earnings of $939,076 for the six months
ended Oct. 31, 2005 was adjusted for the impact of the debt
restructuring of CCI which reduced outstanding debt by $1,596,355.
A net $469,411 change in working capital was offset by
depreciation and amortization expense of $257,683 and a loss on
the disposal of equipment of $4,624.
Billy Ray, chairman and CEO of Charys Holding Company, Inc.,
stated, "The second fiscal quarter marked significant gains in
telecommunication infrastructure services revenue from our
acquisition of CCI. We are very optimistic that CCI, and other
recent acquisitions such as Viasys, will continue to propel strong
year-over-year revenue growth with bottom-line improvements in the
coming quarters."
Headquartered in Atlanta, Georgia,Charys Holding Company, Inc. --
http://www.charys.com/-- is pursuing a growth opportunity in the
Technology InfrastructureSupport and Services market through an
acquisitions strategy, focusing on companies that have strong
individual reputation, proven and underleveraged growth
capability, and significant management commitment tied to Charys-
wide synergies. Charys seeks to acquire stable, cash flow
positive, small to medium-sized private companies engaged in
providing direct services, outsourced services and infrastructure
to medium and large enterprise businesses. Charys intends to
operate these companies as independent subsidiaries, improving
aggregate financial performance by influencing its subsidiaries to
develop and leverage beneficial synergistic relationships.
* * *
Going Concern Doubt
Miller Ray Houser & Stewart LLP expressed substantial doubt about
Charys' ability to continue as a going concern after it audited
the Company's financial statements for the fiscal years ended
April 30, 2005 and 2004. The auditing firm pointed to the
Company's working capital deficit and limited borrowing capacity.
Despite a successful refinancing and partial retirement of the
debt assumed in its acquisition of CCI Telecom, Inc., at present
the Company has a $2.4 million working capital deficit. In
addition, while the Company has a $5 million asset based credit
facility, its borrowing capacity is limited to the extent of the
qualified accounts receivable of CCI.
CHASE COMM'L: S&P Raises Rating on Class G Certificates
-------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on six
classes of Chase Commercial Mortgage Securities Corp.'s commercial
mortgage pass-through certificates from series 1999-2.
Concurrently, the ratings on three other classes from the same
transaction are affirmed.
The raised and affirmed ratings reflect increased credit
enhancement levels that support the ratings through various stress
scenarios.
As of Nov. 18, 2005, the trust collateral consisted of 88 loans
with an aggregate outstanding principal balance of $713.9 million,
down from 92 loans amounting to $782.7 million at issuance. The
master servicer, Wachovia Bank N.A., provided interim and year-end
2004 and interim 2005 financial data for 89.5% of the nondefeased
loans. Based on this information, Standard & Poor's calculated a
weighted average net cash flow debt service coverage of 1.43x, up
from 1.29x at issuance. There are nine defeased loans amounting
to $67.3 million in the pool. The trust has incurred one loss
totaling $2.3 million to date.
The top 10 exposures secured by real estate have an aggregate
pooled balance of $284.9 million, down from $299.1 million at
issuance, and a weighted average DSC of 1.40x, up from 1.27x DSC
at issuance. This figure excludes the seventh-largest loan, for
which financials were not available, and which appears on
Wachovia's watchlist. The DSC figure also excludes the
fourth-largest loan, the Tuscan Inn at Fisherman's Wharf loan.
The Tuscan Inn loan, which is operating under a modification
agreement, reported DSC of 1.65x as of December 2004. Had the
modification not been in place, DSC would have been 0.81x.
Standard & Poor's factored the corrected mortgage fee that will be
generated for this loan into its analysis. The largest and ninth-
largest exposures also are on the servicer's watchlist. As part
of its surveillance review, Standard & Poor's reviewed recent
property inspections provided by Wachovia for the top 10
exposures. All of these properties were characterized as "good."
There are four loans totaling $19.3 million with the special
servicer, CWCapital Asset Management LLC. The Manchester
Apartments loan has a balance of $7.7 million and is secured by a
384-unit multifamily property in Euless, Texas. The loan was
transferred to the special servicer due to imminent default. The
property is currently REO and is under a purchase and sale
agreement with a tentative closing date of Dec. 16, 2005. The
property is currently operating at 85% occupancy. The Mission
Trace Shopping Center loan has a balance of $5.4 million and is
secured by a 129,894-sq.-ft. retail center in Colorado Springs,
Colorado. DSC as of Dec. 31, 2004, was 0.96x, and occupancy as of
July 31, 2005, was 48%. Occupancy has declined at this property
because the shadow anchor vacated its space. The loan is
currently more than 90 days delinquent, and the special servicer
is pursuing foreclosure. The Marketplace Shopping Center loan has
a balance of $3.3 million and is secured by a 42,700-sq.-ft.
shopping center in Warr Acres, Oklahoma. Although the property
reported DSC of 1.25x as of Dec. 31, 2004, the loan was
transferred to the special servicer because the main tenant,
David's Bridal, vacated the property, and the borrower indicated
that he will be unable to continue making debt service payments
once the David's Bridal lease expires in February 2006. The
property is currently 30-plus-days delinquent, and the special
servicer plans to pursue foreclosure. The Enterprise Plaza Office
Building loan has a balance of $3 million and is secured by a
50,393-sq.-ft. office building in Austin, Texas. The loan is
current in its debt service payments. The property reported DSC
of 0.31x as of Dec. 31, 2004. The loan was transferred to the
special servicer on Aug. 8, 2005, because the borrower requested
debt relief. The loan will be returned to the master servicer in
December 2005.
There are 16 loans with an outstanding balance of $153.7 million
on Wachovia's watchlist, including three of the top 10 exposures.
The largest exposure in the trust, the Orange County Industrial
and Office Portfolios, has a $46.5 million balance and reported
DSC of 1.31x for 2004. The portfolio consists of 11 industrial
and six office properties spread across Northern California. This
loan appears on the watchlist due to occupancy issues. The
combined occupancy of the properties securing this loan was 93% as
of June 30, 2005, with about 14% rolling by year-end 2006. The
seventh-largest loan, the Winstanley portfolio, has an outstanding
balance of $19.7 million and is secured by six industrial and
three office properties in Connecticut. This loan did not report
any 2004 financial information and appears on the watchlist
due to occupancy issues. The combined occupancy was 99% as of
July 14, 2005, with about 2% rolling within the next six months.
The ninth-largest loan, the Sonterra Apartments loan, is secured
by a 272-unit multifamily property in Austin, Texas. This loan
has an outstanding balance of $15.8 million and reported DSC of
0.44x for 2004. It appears on the watchlist due to the low DSC
level. Most of the remaining loans on the watchlist have
occupancy or DSC issues.
Standard & Poor's stressed the specially serviced loans,
watchlisted loans, and other loans with potential credit issues
as part of its analysis. The resultant credit enhancement levels
support the raised and affirmed ratings.
Ratings Raised
Chase Commercial Mortgage Securities Corp.
Commercial Mortgage Pass-Through Certificates Series 1999-2
Rating
Class To From Credit enhancement
----- -- ---- ------------------
B AAA AA+ 23.31%
C AA+ A+ 18.10%
D AA A 16.46%
E A+ BBB 12.62%
F A- BBB- 10.98%
G BBB- BB+ 7.14%
Ratings Affirmed
Chase Commercial Mortgage Securities Corp.
Commercial Mortgage Pass-Through Certificates Series 1999-2
Class Rating Credit enhancement
----- ------ ------------------
A-1 AAA 29.07%
A-2 AAA 29.07%
X AAA N/A
N/A - not applicable.
COIN BUILDERS: Wants to Employ James Spath as Accountant
--------------------------------------------------------
The Hon. Thomas S. Utschig of the U.S. Bankruptcy Court for the
Western District of Wisconsin in Dane gave Coin Builders, LLC,
permission to employ James B. Spath as its accountant.
Mr. Spath will render accounting services. Papers filed with the
Court don't indicate Mr. Spath's billing rates.
Mr. Spath assures the Court that his Firm does not have any
interest adverse to the Debtor, its creditors and its estates.
Mr. Spath can be contacted at:
James B. Spath
195 Second Street North
Wisconsin Rapids, Wisconsin
Headquartered in Wisconsin Rapids, Wisconsin, Coin Builders, LLC
-- http://www.coinbuilders.net/-- has four subsidiaries that
operate in the merchandising, wholesale, restaurant, and
aviation sectors. The Debtor filed for chapter 11 protection
on September 26, 2005 (Bankr. W.D. Wis. Case No. 05-18109).
George B. Goyke, Esq., at Goyke, Tillisch & Higgins LLP represents
the Debtor in its restructuring efforts. When the Debtor filed
for protection from its creditors, it estimated assets between
$1 million to $10 million and debts between $10 million to
$50 million.
COIN BUILDERS: Panel Wants Brennan Steil as Bankruptcy Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Coin
Builders, LLC's bankruptcy case asks the Hon. Thomas S. Utschig of
the U.S. Bankruptcy Court for the Western District of Wisconsin in
Dane for permission to hire Brennan, Steil & Basting, S.C., as its
counsel.
Brennan Steil will:
(a) provides legal advice, and
(b) represent the Committee in all phases of the Debtor's
restructuring, including:
-- preparing necessary applications, motions, answers,
orders, reports, and other legal matters,
-- appearing in Court in behalf of the Committee to protect
the interest of the members,
-- providing legal advice to the Committee regarding
actions taken by the Debtor, including avoidance actions
and any proposed plan of reorganization, and
-- performing all other legal services for the Committee
that may be necessary and proper in the Debtor's case.
Claire Ann Resop, Esq., a partner at Brennan, Steil & Basting,
S.C., discloses that the Firm will be paid by their customary
hourly billing rates:
Professional Designation Hourly Rate
------------ ----------- -----------
Claire Ann Resop, Esq. Partner $245
Eliza Reyes, Esq. Associate $200
Jean Steele Paralegal $110
Ms. Resop assures the Court that the Firm has no adverse interest
to the Committee, the Debtor, its creditors, and its estate.
With four offices in Wisconsin, Brennan, Steil & Basting, S.C. --
http://www.bsbmlaw.com/-- is a general practice and trial law
firm.
Headquartered in Wisconsin Rapids, Wisconsin, Coin Builders, LLC
-- http://www.coinbuilders.net/-- has four subsidiaries that
operate in the merchandising, wholesale, restaurant, and
aviation sectors. The Debtor filed for chapter 11 protection
on September 26, 2005 (Bankr. W.D. Wis. Case No. 05-18109).
George B. Goyke, Esq., at Goyke, Tillisch & Higgins LLP represents
the Debtor in its restructuring efforts. When the Debtor filed
for protection from its creditors, it estimated assets between
$1 million to $10 million and debts between $10 million to
$50 million.
COLLINS & AIKMAN: Names D. Profitt as Plastics Operations Pres.
---------------------------------------------------------------
Frank Macher, President and Chief Executive Officer of Collins &
Aikman Corporation (CKCRQ) reported the appointment of Dennis
Profitt as President, Plastics operations for the North American
automotive supplier, effective Jan. 1, 2006. In this position,
Profitt will oversee all manufacturing, tooling, process
engineering and quality issues for the Company's Plastics
operations.
Mr. Profitt joins Collins & Aikman from Ford Motor Company where
he most recently managed the $2 billion development of the
company's renowned Rouge Center. With more than 30 years of
leadership experience and a history of proven performance in
managing global manufacturing operations, Profitt brings extensive
knowledge in implementing world-class procedures and efficiency
improvement initiatives.
"Dennis built a reputation as one of Ford's top troubleshooters in
the manufacturing arena," Mr. Macher said. "He is a proven
manufacturing and operations leader with a focus on achieving
quality and driving efficiency that will provide a solid
foundation for our Plastics operations. Dennis is a welcome
addition to the experienced team of executives that have recently
joined the Company and are implementing the restructuring of
Collins & Aikman."
Prior to his Site Manager and Director of Manufacturing roles at
Ford Motor Company's Rouge Center and Dearborn Truck plant, Mr.
Profitt spent 4 years managing Ford's operations in Belgium. Mr.
Profitt's extensive career at Ford consisted of increasingly
responsible positions in virtually all areas of the manufacturing
process. Mr. Profitt is formally trained in the Toyota Production
System and has implemented its practices at facilities throughout
the country. Mr. Profitt holds a Bachelor of Science degree in
Mathematics from Ohio University.
Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in cockpit
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems. The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world. The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case
No. 05-55927). When the Debtors filed for protection from their
creditors, they listed $3,196,700,000 in total assets and
$2,856,600,000 in total debts.
COMBUSTION ENG'G: Court Confirms Modified Plan of Reorganization
----------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware confirmed Combustion Engineering,
Inc.'s Modified Plan of Reorganization.
Judge Fitzgerald determined that the Plan met the 13 standards for
confirmation required under Section 1129(a) of the Bankruptcy
Code.
Under the Modified Plan, treatment of claims other than asbestos
personal injury claims remain unchanged.
Priority claims, secured claims, workers' compensation claims,
general unsecured claims will be unimpaired.
The Plan separates the tort claimants into two classes:
a) Non-participants to the CE Settlement Trust will be subject
to a channeling injunction. The injunction will require
the tort claimants to assert their claims against the
Asbestos PI Trust. The Trust will be funded with
substantial assets including ABB's $232 million
contribution.
b) Participants in the CE Settlement Trust will also be
subject to a channeling injunction. The participants will
receive a release of any preference claims and fraudulent
transfer claims from the Debtors. They will also be
permitted to keep any distributions that have been or will
be made from the CE Settlement Trust.
The Asbestos PI Trust will act as a Qualified Settlement Fund as
defined in the Treasury Regulations under Section 468B of the
Internal Revenue Code.
The Modified Plan also contemplates Lummus' filing of a chapter 11
case to liquidate its assets and create the Lummus Asbestos PI
Channelling Injunction Trust. The Trust will contribute
$204 million to the Asbestos PI Trust upon the sale of Lummus.
Valuation & Plan Funding
Under the Plan, CE's US$812,000,000 value is delivered to the
Sec. 524(g) Trust for the benefit of present and future claimants.
In addition:
(1) ABB contributes:
(a) 30,298,913 shares of its stock, initially valued
at $50,000,000, but with a current market value
exceeding $81,000,000;
(b) a financial commitment to pay $250,000,000 to the
Trust in pre-agreed installments from 2004 to 2009
(guaranteed by certain ABB affiliates);
(c) up to $100,000,000 more from 2006 through 2011 if
certain performance benchmarks are achieved; and
(2) Asea Brown Boveri contributes:
(a) an indemnification of all of CE's environmental
liabilities, which has a value of around
$100,000,000;
(b) a release of its indemnification rights against CE
for asbestos claims asserted against Asea Brown
Boveri after June 30, 1999;
(c) a note evidencing Asea Brown Boveri's agreement to
contribute almost $38,000,000 on account of the
asbestos claims attributable to:
-- Basic, Incorporated (CE acquired this
acoustical plaster manufacturer in 1979) and
-- ABB Lummus Global, Inc. (CE acquired
this manufacturer of feed water heaters that
used asbestos-containing gaskets in
transactions stretching from 1930 to 1970);
(3) Lummus and Basic release and assign all of their
interests in insurance covering asbestos personal
injury claims, including certain CE-shared policies.
A full-text copy of the Modified Disclosure Statement is available
for a fee at:
http://www.researcharchives.com/bin/download?id=050822021626
About ABB
ABB -- http://www.abb.com-- is a leader in power and automation
technologies that enable utility and industry customers to
improve performance while lowering environmental impact. The
ABB Group of companies operates in more than 100 countries and
employs about 146,000 people. As of Dec. 31, 2004, ABB listed
$24,677,000,000 in total assets and $5,534,000,000 in total debts.
S&P rates ABB's 3-3/4% $500 million note due on Sept. 30, 2009, at
BB-, while Moody's assigns its Ba2 rating on the same note.
Headquartered in Norwalk, Connecticut, Combustion Engineering,
Inc., is the U.S. subsidiary of the ABB Group. ABB is a leader in
power and automation technologies that enable utility and industry
customers to improve performance while lowering environmental
impact. The ABB Group of companies operates in more than 100
countries and employs about 103,000 people. Combustion
Engineering filed for chapter 11 protection on Feb. 17, 2003
(Bankr. D. Del. Case No. 03-10495). Curtis A. Hehn, Esq., at
Pachulski Stang Ziehl Young & Jones and Jennifer Mo, Esq., at
Kirkpatrick & Lockhart Nicholson Graham represents the Debtor in
its restructuring efforts. When the Debtor filed for protection
from its creditors, it estimated more than $100 million in assets
and debts.
COOL PARTNERS: Insurers Agree to $8.1 Million Settlement
--------------------------------------------------------
Insurers for Cool Partners, Inc., agreed to a settlement that will
recoup more than $8 million for a group of former company
shareholders and the chapter 7 trustee. The U.S. Bankruptcy Court
for the Northern District of Texas approved the settlement
yesterday, Dec. 20, 2005.
Geoffrey Harper, Esq., a partner Dallas' Fish & Richardson, led a
group of attorneys representing 100 former shareholders of the
Debtor. The attorneys also represented Robert Yaquinto, trustee
in the Debtor's bankruptcy proceedings.
"We are extremely pleased to have achieved this result for a group
of people who lost a lot of money because of the greed of others,"
Mr. Harper says. "While they thought their investments were safe,
the company was busy throwing money at Ferrari racing teams and
trips to Mexico for swimsuit model calendar shoots."
The Debtor filed for chapter 7 bankruptcy protection in January
2002 and soon after, the company and its officers and directors
became the subject of multiple lawsuits alleging fraud,
misrepresentation, wrongful conversion of corporate assets, and a
variety of other claims.
The lawsuit against six former company officers and directors was
scheduled to begin Jan. 17, 2006 in Judge Mark Greenberg's County
Court at Law No. 5 in Dallas.
The Hon. Harlin D. Hale approved the settlement in all respects
and in addition to $7,541,078 from Cool Partners' insurers, the
settlement includes a $510,000 payment from two law firms that
provided legal counsel to the Debtor prior to the bankruptcy
filing. The law firms were not formally sued in the case.
Under the proposed settlement, the group of shareholders and the
bankruptcy trustee will split the proceeds evenly. Mr. Harper
says the recovery will amount to approximately 25 cents on the
dollar after attorney's fees.
"It's not everyday that you see this type of recovery for a
company that had virtually no assets," Mr. Harper says. "Although
both insurers put up a fierce fight, we are thankful that we were
able to reach the best agreement for the trustee and the former
shareholders."
In addition to Mr. Harper, the attorneys for the shareholder and
the bankruptcy trustee included Steven H. Stodghill, Victor C.
Johnson and Kiprian Mendrygal from Fish & Richardson, P.C., and I.
Richard Levy from I. Richard Levy, P.C.
About Fish & Richardson
Founded in 1878, Fish & Richardson is one of the largest law firms
in the U.S. practicing exclusively in the areas of intellectual
property, litigation, and corporate law. The firm has over 350
attorneys and technology specialists in nine offices nationwide.
Fish & Richardson has long represented great innovators and
entrepreneurs, including pioneering inventors such as Alexander
Graham Bell, Thomas Edison, and the Wright Brothers. Fish &
Richardson handles more patent litigation than any other law firm
in the U.S. (IP Law & Business July 2005). It is the top firm in
patent cases at the International Trade Commission and rates among
the top U.S. firms in patents and trademarks obtained.
About Cool Partners Inc.
Headquartered in Plano, Texas, Cool Partners, Inc., operated as an
Internet service provider under the name Coollink Broadcast
Network. The Debtor filed for chapter 7 protection on Jan. 20,
2005 (Bankr. N.D. Tex. Case No. 02-30446). Joe E. Marshall, Esq.,
at Munsch, Hardt, Kopf & Harr, P.C., represents the Debtor in its
liquidation efforts.
CP SHIPS: Completes 4% Senior Notes Offer and Consent Solicitation
------------------------------------------------------------------
CP Ships Limited reported that it has accepted for payment a total
of approximately $198.9 million aggregate principal amount of its
4% Senior Subordinated Convertible Notes due 2024, representing
approximately 99% of the outstanding Notes. The Notes were
tendered pursuant to CP Ships' previously announced cash tender
offer to purchase any and all of its outstanding Notes. The offer
expired at 5:00 p.m. (New York time) on 14th December 2005 and all
rights of withdrawal with respect to tendered Notes expired at
5:00 p.m. (New York time) on 16th December 2005. All Notes
purchased by CP Ships will be retired. After giving effect to the
purchase and retirement of Notes tendered to the offer, $1,121,000
aggregate principal amount of Notes will be held by holders of
Notes, and no Notes will be held by CP Ships.
CP Ships also announced today that it has successfully completed
its consent solicitation relating to the Notes, which was
conducted in conjunction with CP Ships' offer to purchase the
Notes. Accordingly, CP Ships and The Bank of New York, as
trustee, have executed a supplemental indenture to the indenture
governing the Notes, the effect of which is to eliminate certain
reporting obligations and restrictive covenants as well as certain
events of default and related provisions contained in the
indenture. The consent solicitation expired at 5:00 pm (New York
time) on 16th December 2005
In accordance with the terms of the tender offer, CP Ships expects
to pay The Bank of New York, on behalf of holders who validly
tendered (and did not validly withdraw) Notes to the offer prior
to the offer expiry time, an aggregate of approximately $203
million on 19th December 2005, representing the $198.9 aggregate
principal amount of Notes tendered, plus accrued and unpaid
interest to, but not including, the payment date under the offer.
On 19th December 2005, CP Ships will also pay, in accordance with
the terms of the consent solicitation, The Bank of New York, on
behalf of holders of Notes, $2.50 for each $1,000 principal amount
of Notes in respect of which consents were validly delivered and
not validly revoked prior to the consent solicitation expiry time.
In connection with the previously announced acquisition of CP
Ships by TUI AG, it is anticipated that TUI will acquire all
remaining CP Ships common shares on 20th December 2005 pursuant to
the amalgamation of CP Ships and Ship Acquisition Inc, a wholly-
owned subsidiary of TUI, on such date.
As previously announced, upon the amalgamation of CP Ships and
Ship Acquisition Inc., CP Ships (as the corporation resulting from
the amalgamation) will satisfy its obligation to deliver shares
upon the conversion of the Notes by delivery of redeemable special
shares of CP Ships. CP Ships expects to redeem any redeemable
special shares issued upon such conversion immediately following
their issuance for US $21.50 per share.
CP Ships -- http://www.cpships.com/-- a subsidiary of TUI AG,
provides international container transportation in four key
regional markets: TransAtlantic, Australasia, Latin America and
Asia with 38 services in 21 trade lanes. As of 30th September
2005 its vessel fleet was 80 ships and its container fleet 432,000
teu. Volume in 2004 was 2.3 million teu. CP Ships also owns
Montreal Gateway Terminals, which operates one of Canada's largest
marine container terminal facilities. TUI expects to complete its
acquisition of 100% of CP Ships on December 20, 2005, at which
time CP Ships is expected to delist from the Toronto and New York
stock exchanges. TUI plans to integrate CP Ships into its other
shipping subsidiary Hapag-Lloyd to create the world's fifth-
largest container shipping company.
* * *
As reported in the Troubled Company Reporter on Nov. 1, 2005,
Standard & Poor's Ratings Services revised the implications of its
CreditWatch placement on New Brunswick-based CP Ships Ltd. to
negative from developing. The ratings were originally placed on
CreditWatch with developing implications on Aug. 22, 2005, when
its management board recommended it accept a takeover offer from
Germany-based tourism and container shipping group, TUI AG.
CSC HOLDINGS: Fitch Withdraws Rating on Proposed $5.5 Bil. Debts
----------------------------------------------------------------
Fitch Ratings has placed the 'B+' issuer default rating assigned
to the restricted group of CSC Holdings, Inc. on Rating Watch
Negative. Additionally, Fitch placed these ratings on Rating
Watch Negative:
-- Senior unsecured debt 'BB-', recovery rating 'RR3';
-- Senior subordinated debt 'B', recovery rating 'RR5';
-- Senior secured credit facility 'BB', recovery rating
'RR1'.
Fitch has withdrawn the 'BB-' rating assigned to CSC's proposed
offering of $1 billion senior unsecured notes and the 'BB' rating
to CSC's proposed $4.5 billion credit facility.
Approximately $8.6 billion of debt at CSC as of Sept. 30, 2005 is
affected by Fitch's action.
Fitch's action follows the company's disclosure that the company
has violated technical covenants contained in CSC's $2.4 billion
bank facility and has potentially violated technical covenants
contained in other debt instruments.
CSC is on the process of seeking waivers from the lender's party
to its bank agreement and, if necessary, will seek waivers under
debt instruments where it is found that CSC is also in covenant
violation. Additionally, the company has decided not to proceed
with its previously announced special dividend or the proposed
$1 billion senior note offering.
In resolving the Rating Watch, Fitch will consider:
* the scope of the actual and potential covenant violations,
* the possible waivers thereto, and
* any impact the resolution of the covenant violations may
have on the company's capital structure, access to the
existing credit facility and capital markets, and the
company's liquidity profile going forward.
CSK AUTO: S&P Rates $210 Million Senior Exchangeable Notes at B+
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' rating to CSK
Auto Inc.'s $85 million 4.625% senior exchangeable notes due 2025
and $125 million 3.375% senior exchangeable notes due 2025. These
notes are unsecured and were issued under rule 144A with
registration rights.
At the same time, the 'B+' corporate credit rating was affirmed.
Proceeds from the $85 million note offering and additional
borrowings under its credit facility will be used to fund the
acquisition of Murray's Discount Auto for $170 million. The
outlook remains stable.
"While credit metrics pro forma for the acquisition will be weak
for current ratings," said Standard & Poor's credit analyst Stella
Kapur, "we anticipate that they will improve over the next year as
CSK uses its free cash flow to pay down debt." Lease-adjusted
debt to EBITDA is anticipated to increase to the low-6x area pro
forma for the transaction from 5.7x at Oct. 30, 2005. Current
weak credit metrics are partially offset by the company's business
profile and its position as the third-largest auto part retailer
in the U.S.
D.R. HORTON: Enters into Five-Year $2.15 Billion Credit Facility
----------------------------------------------------------------
D.R. Horton, Inc., America's Builder, (NYSE: DHI) entered into
a five-year, $2.15 billion revolving credit facility with a
$1 billion letter of credit sub-facility. The facility has an
uncommitted $750 million accordion feature which could increase
the facility to $2.9 billion. The five-year facility replaces the
Company's existing $1.21 billion credit facility.
The new facility was arranged by Wachovia Securities, RBS
Securities Corporation and Banc of America Securities, LLC, as
Joint Lead Arrangers and Joint Bookrunners. Wachovia Bank, NA is
Administrative Agent; The Royal Bank of Scotland PLC and Bank of
America, N.A. are Co-Syndication Agents; and Calyon New York
Branch, JP Morgan Chase Bank, N.A., BNP Paribas, Citicorp, N.A.,
UBS Loan Finance LLC, and The Bank of Nova Scotia are Co-
Documentation Agents. Thirty other lenders participate in the
facility.
Donald R. Horton, Chairman of the Board, said, "We deeply
appreciate the support that our lenders have provided to us in the
past, and we are pleased with the confidence they are now showing
in us by increasing the size and extending the maturity of our
credit facility. We are also excited to welcome several new
lenders to the D.R. Horton family as they join this facility. Our
lenders have played an important role in the success of "America's
Builder," and we believe the working capital from this facility
will provide us with continued operational flexibility to help us
maintain our position as the nation's largest homebuilder."
D.R. Horton, Inc., America's Builder, is the largest homebuilder
in the United States, delivering more than 51,000 homes in its
fiscal year ended Sept. 30, 2005. Founded in 1978 in Fort Worth,
Texas, D.R. Horton has expanded its presence to include 74 markets
in 25 states in the Midwest, Mid-Atlantic, Southeast, Southwest
and Western regions of the United States. The Company is engaged
in the construction and sale of high quality homes with sales
prices ranging from $90,000 to over $900,000. D.R. Horton also
provides mortgage financing and title services for homebuyers
through its mortgage and title subsidiaries.
* * *
As reported in the Troubled Company Reporter on Nov. 9, 2005,
Moody's Investors Service raised the ratings of D.R. Horton, Inc.,
including the ratings on the company's senior notes to Baa3 from
Ba1 and the ratings on its senior subordinated notes to Ba1 from
Ba2. The ratings have been taken off review for upgrade where
they had been placed on July 13, 2005. D.R. Horton becomes the
eighth homebuilder to attain an investment grade rating out of 21
that are publicly rated. The ratings outlook is stable.
The stable ratings outlook is based on Moody's expectation that
Horton will maintain capital structure discipline even as it takes
advantage of numerous growth opportunities and that homebuilding
debt/capitalization will generally stay at or close to the 45%
stated target for the company.
The rating changes are listed as:
* Ba1 Corporate Family Rating (formerly, senior implied rating)
has been withdrawn
* $215 million of 7.5% senior notes, due December 1, 2007
raised to Baa3 from Ba1
* $200 million of 5% senior notes, due January 15, 2009 raised
to Baa3 from Ba1
* $385 million of 8% senior notes, due February 1, 2009 raised
to Baa3 from Ba1
* $250 million of 4.875% senior notes, due January 15, 2010
raised to Baa3 from Ba1
* $200 million of 7.875% senior notes, due August 15, 2011
raised to Baa3 from Ba1
* $250 million of 8.5% senior notes due April 15, 2012 raised
to Baa3 from Ba1
* $300 million of 5.375% senior notes due June 15, 2012 raised
to Baa3 from Ba1
* $200 million of 6.875% senior notes due May 1, 2013 raised to
Baa3 from Ba1
* $100 million of 5.875% senior notes due July 1, 2013 raised
to Baa3 from Ba1
* $200 million of 6.125% senior notes due January 15, 2014
raised to Baa3 from Ba1
* $250 million of 5.625% senior notes due September 15, 2014
raised to Baa3 from Ba1
* $300 million of 5.25% senior notes due February 15, 2015
raised to Baa3 from Ba1
* $300 million of 5.625% senior notes due January 15, 2016
raised to Baa3 from Ba1
* $150 million of 9.75% senior sub notes, due
September 15, 2010 raised to Ba1 from Ba2
* $200 million of 9.375% senior sub notes, due March 15, 2011
raised to Ba1 from Ba2
* $145 million of 10.5% senior sub notes, due July 15,2011
(issued by Schuler Homes and assumed by D.R. Horton in the
merger of February 2002) raised to Ba1 from Ba2
* SGL-2 Speculative Grade Liquidity rating has been withdrawn
DEAN FOODS: S&P Places BB- Debt Rating on Shelf Registration
------------------------------------------------------------
Standard & Poor's Ratings Services assigned a preliminary 'BB-'
senior unsecured debt rating on Dean Foods Co.'s Rule 415 shelf
registration of debt securities.
At the same time, Standard & Poor's affirmed its 'BB+' corporate
credit rating and other ratings on Dean Foods and Dean Holding Co.
The outlook is stable. The Dallas, Texas-based dairy processor
had total debt of $3.4 billion at Sept. 30, 2005.
"We expect that Dean Foods will maintain its leading position in
the dairy industry and that the company's financial profile will
improve in the intermediate term," said Standard & Poor's credit
analyst Jayne Ross.
If Dean Foods is able to sustain stronger credit protection
measures and a more moderate financial policy, the outlook could
be revised to positive or the ratings could be raised. The
outlook could be revised to negative if the company's operating
performance declined and there was the related negative effect on
credit protection measures.
DELPHI CORP: Defers Filing of Sec. 1113 & 1114 Motions to Feb. 17
-----------------------------------------------------------------
Delphi Corp. reaffirmed on Dec. 19, 2005, its commitment to
reaching a consensual agreement with its unions and General Motors
on a comprehensive restructuring. The company also said that in
light of GM's recent engagement and discussions with the UAW,
Delphi is withdrawing its Nov. 15, 2005, proposal to its unions
which had been based solely on Delphi's financial constraints.
Following these discussions, Delphi said it will continue to work
toward creating effective solutions acceptable to Delphi and its
stakeholders, as well as to the UAW, GM and other unions. The
company said that to further facilitate discussions it would
defer the filing of Section 1113 and 1114 motions to the U.S.
Bankruptcy Court for the Southern District of New York until at
least Feb. 17, 2006.
The company's primary short-term focus is to reach consensual
agreements enabling competitiveness for Delphi's core U.S.
operations, by modifying current labor agreements and realigning
Delphi's global product portfolio and manufacturing footprint to
preserve the company's core business. The consensual agreements
will help preserve the value of the company, provide viable jobs
in the U.S. for employees and better serve customers globally.
Delphi is committed to completing its transformation plan as
quickly as possible and to that end, does not intend to comment
further on discussions with the unions or GM.
The company noted that depending on the outcome of discussions, it
may be necessary to return to its Nov. 15, 2005, proposal.
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 CORP: Wants to Hire Banner as Intellectual Property Counsel
------------------------------------------------------------------
David M. Sherbin, vice president, general counsel, and chief
compliance officer of Delphi Corporation, tells the U.S.
Bankruptcy Court for the Southern District of New York that Banner
& Witcoff, Ltd., is a nationally well-known and respected
intellectual property law firm and almost all of its lawyers are
experienced, registered patent lawyers with technical degrees and
substantial patent infringement case litigation experience.
Delphi Corporation and its debtor-affiliates had retained Banner &
Witcoff as an ordinary course professional. According to Mr.
Sherbin, Banner has successfully represented Delphi, and its
predecessor in business, General Motors Corporation, in many
patent infringement cases.
Because the firm has extensive experience in intellectual property
law in the Debtors' industry, Mr. Sherbin believes that Banner can
economically, successfully, and uniquely represent the Debtors in
cases currently pending against them and other related
intellectual property matters.
The Debtors employed Banner in the ordinary course of business.
Now, they are concerned that the firm's fees will exceed the cap
established in the OCP Order.
Thus, by this application, the Debtors seek The Honorable Robert
D. Drain of the Southern District of New York Bankruptcy Court's
authority to employ Banner as their intellectual property counsel,
nunc pro tunc to October 8, 2005.
Banner will provide services to the Debtors in connection with
intellectual property matters, especially protective and
defensive patent cases and opinions.
Specifically, Banner will:
(a) represent the Debtors in "Automotive Technologies
International, Inc. v. BMW North America, Inc., et al.,"
Appeal No. 06-1013 (Federal Circuit September 29, 2005)
and its underlying case, Civil Action No. 01-71700
(April 30, 2001);
(b) represent the Debtors in "Automotive Technologies
International, Inc. v. Delphi Automotive Systems
Corporation, et al.," Civil Action No. 04-72035
(E.D. Mich. April 30, 2005);
(c) prepare legal opinions involving claims relating to the
Debtors' product and patents, as well as claims made by
competitors; and
(d) represent the Debtors regarding a broad scope of
intellectual property law services.
As agreed to by the parties, the Debtors will pay the four-member
team assigned in their cases at a discounted hourly professional
rate:
Regular Discounted
Banner Professional Hourly Rate Rate
------------------- ----------- ----------
Charles Shifley, Esq. $455 $435
Binal Patel, Esq. $335 $320
Matt Becker, Esq. $310 $295
Ted Field, Esq. $220 $215
Banner agrees to pay 100% of the transportation expenses for
travel to Detroit incurred by the team members in connection with
relevant matters. Banner also agrees to accrue a 5% credit to
Delphi on professional billings related to the Automotive
Technologies I Matter, to be used as payment for services on any
future matter if the Debtors retain the firm. This credit will
accrue from the first dollar of the Automotive Technologies II
fee billings but will not vest until fee billings for the
Automotive Technologies II Matter exceed $1,000,000.
Charles W. Shifley, Esq., an attorney at Banner, assures the
Court that the firm does not hold or represent any interest
adverse to the Debtors, their creditors, any other party-in-
interest in the Debtors' Chapter 11 cases, or the United States
Trustee with respect to the matters on which the firm is to be
employed.
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. 11; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
DELPHI CORP: Wants to Hire Butzel Long as Litigation Counsel
------------------------------------------------------------
Delphi Corporation and its debtor-affiliates seek the U.S.
Bankruptcy Court for the Southern District of New York's authority
to employ Butzel Long, PC, as their commercial and litigation
counsel, nunc pro tunc to October 8, 2005.
Delphi Corporation Vice President, General Counsel and Chief
Compliance Officer David M. Sherbin relates that Butzel Long has
performed similar work for the Debtors for the past five years
and is, therefore, very familiar with their businesses and
operations. Butzel is especially attuned to the unique commercial
issues that arise in the Debtors' industry.
According to the Debtors, Butzel Long is one of the largest full
service law firms in Michigan with over 200 attorneys who handle
a wide range of sophisticated commercial and other business
matters for some of the nation's largest companies and non-profit
organizations. Several members of the firm have extensive
experience in commercial and general business law and their
interplay with restructuring and bankruptcy law.
As the Debtors' commercial and litigation counsel, Butzel Long
will provide:
(1) legal advice and litigation services with respect to tort,
contract, and general business disputes within the states
of Michigan and Ohio;
(2) legal advice and representation with respect to out-of-
court commercial workouts;
(3) legal advice and representation with respect to collection
service disputes;
(4) legal advice and representation with respect to
financially distressed suppliers; and
(5) miscellaneous commercial and litigation advice and counsel
related to local issues.
The Debtors will pay Butzel Long in accordance with its standard
hourly rates, reduced by 20% and capped at $250 per hour. The
Butzel attorneys who are expected to be principally responsible
for the matters in Debtors' Chapter 11 cases and their hourly
rates are:
Professional Hourly Rate
------------ -----------
James Derian, Esq. $265
Paul Hall, Esq. $225
Sara Keough, Esq. $210
Thomas Radom, Esq. $340
Brent Warner, Esq. $150
Matthew Wilkins, Esq. $340
Moreover, the Debtors will reimburse Butzel Long for necessary
expenses incurred.
James G. Derian, Esq., a member of Butzel Long, attests that the
firm does not hold or represent any interest adverse to the
Debtors, their creditors, or any other party-in-interest.
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. 11; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
DERIVIUM CAPITAL: Court Converts Case to Chapter 7 Liquidation
--------------------------------------------------------------
The Hon. Cecelia G. Morris of the U.S. Bankruptcy Court for the
Southern District of New York converted the chapter 11 case of
Derivium Capital LLC into a liquidation proceeding under chapter 7
of the Bankruptcy Code.
Deirdre A. Martini, the U.S. Trustee for Region 2, had asked the
Bankruptcy Court to convert or dismiss the Debtor's bankruptcy
case on allegations that the Debtor had not acted in good faith
during its bankruptcy proceedings.
As reported in the Troubled Company Reporter on Nov. 3, 2005, the
U.S. Trustee cited the Debtor's failure to meet reporting
requirements under Sections 1112(e), 704(8), 1106, and 1107 of the
Bankruptcy Code. The U.S. Trustee said that the Debtor's failure
to fulfill this obligation denies creditors access to important
financial information regarding the Debtor's financial affairs.
Further, the U.S. Trustee charged that the Debtor has not engaged
in business since 2002. The U.S. Trustee stated that the absence
of business operations, significant assets, and employees and the
pursuit of questionable litigation do not support a Chapter 11
reorganization.
Debtor Airs Side
In response to the U.S. Trustee's accusations, the Debtor insisted
that it sought protection from its creditors in good faith.
Steven A. Soulios, Esq., at Ruta & Soulios LLP, explained that the
Debtor filed for bankruptcy protection because:
a) it could not market the 90% Stock Loan without first
obtaining, finally and fully, a legal ruling as to the bona
fide nature of the transaction, a determination it intends
to seek in bankruptcy; and
b) it could not continue to defend multiple litigations in
various states throughout the country.
The 90% Stock Loan is a transaction whereby the borrower pledges
certain stock to secure a loan with loan proceeds established at
90% of the market value of the stock. The Debtor did not fund
the loans to borrowers, but merely arranged for them.
In 2002, the Department of Corporations of California moved to
enjoin the Debtor from marketing the 90% Stock Loan, saying the
transaction was a sale of security and thus required a broker
license under California Corporations Code. The Debtor was forced
to cease operations partly because of the DOC litigation.
Court Findings
After reviewing the U.S. Trustee's claims and the Debtor's
response, the Bankruptcy Court found that cause exists for a
chapter 7 conversion because of:
1. the debtor's lack of insurance;
2. the debtor's lack of profit during its pre-petition period
of operation;
3. the debtor's inability to effectuate a plan;
4. the failure to timely file monthly financial statement,
the failure to prepare it in compliance with the U.S.
Trustee's Operating Guidelines;
5. the debtor's failure to provide the United States Trustee
with the requested sworn statement regarding the amounts
paid to the debtor's principals, furnishing only an
attorney's letter.
6. the representation of the debtor-in-possession of
professionals without approval by the Court, contrary to
the requirements of the bankruptcy laws.
7. the debtor's improper inclusion of an insider in the list
of twenty largest creditors filed with the Court.
8. a pattern of delay, including the untimely filing of
schedules, and list of creditors, and the debtor's
principal being out of the country on the date of the
Section 341(a) meeting.
9. the debtor's pattern of making determinations without
required Court involvement, including the untimely filing
of schedules without seeking an extension of time; the
debtor's principal making the decision to not appear at
the initial Section 341(a) meeting without seeking Court
approval; and the representation of the estate by
professionals not retained by Court order;
10. the debtor's failure to pay required quarterly fee
pursuant to 28 U.S.C. Sec. 1930(a)(6).
11. the failure to adequately account for the $20 to $25
million in commissions allegedly earned during its
prepetition operations.
Headquartered in Tuxedo, New York, Derivium Capital LLC markets
and administers loans. The Company filed for chapter 11
protection on Sept. 1, 2005 (Bankr. S.D.N.Y. Case No. 05-37491).
Steven Soulios, Esq., at Ruta & Soulios, LLP, represents the
Debtor in its restructuring efforts. When the Debtor filed for
protection from its creditors, it listed $60,000,000 in assets
and $79,890,199 in debts.
DIGITAL LIGHTWAVE: Optel Loan Totals $51.7 Mil. as of Dec. 12
-------------------------------------------------------------
Digital Lightwave, Inc., borrowed:
-- $250,000 on December 8, 2005, and
-- $500,000 on December 12, 2005,
from Optel Capital, LLC, to fund its working capital requirements.
Each loan is evidenced by a separate secured promissory note,
bears interest at 10.0% per annum, and is secured by liens on
substantially all of the Company's assets.
Principal and any accrued but unpaid interest under each secured
promissory note is due and payable upon demand by Optel at any
time after December 31, 2005.
The Company continues to have insufficient short-term resources
for the payment of its current liabilities.
As of December 12, 2005, the Company owed Optel approximately
$46 million in principal plus approximately $5.7 million of
accrued interest thereon, which debt is secured by a first
priority security interest in substantially all of the Company's
assets and such debt accrues interest at a rate of 10.0% per
annum.
If the Company is not able to obtain financing, it expects that it
will not have sufficient cash to fund its working capital and
capital expenditure requirements for the near term and will not
have the resources required for the payment of its current
liabilities when they become due. The Company's ability to meet
cash requirements and maintain sufficient liquidity over the next
12 months is dependent on the Company's ability to obtain
additional financing from funding sources, which may include, but
may not be limited to Optel. Optel currently is, and continues to
be, the principal source of financing for the Company. The
Company has not identified any funding source other than Optel
that would be prepared to provide current or future financing to
the Company.
The Company has entered into discussions with Optel to restructure
the short-term notes and the secured convertible promissory note
by extending the maturity date of these debts, to arrange for
additional short-term working capital and to continue guarantees
through letters of credit to secure vendor obligations. If the
Company does not reach an agreement to restructure the short-term
notes and the secured convertible promissory note, continue its
guarantees through letters of credit and obtain additional
financing from Optel, the Company will be unable to meet its
obligations to Optel and other creditors, and in an attempt to
collect payment, creditors including Optel, may seek legal
remedies.
Based in Clearwater, Florida, Digital Lightwave, Inc., provides
the global communications networking industry with products,
technology and services that enable the efficient development,
deployment and management of high-performance networks. Digital
Lightwave's customers -- companies that deploy networks, develop
networking equipment, and manage networks -- rely on its offerings
to optimize network performance and ensure service reliability.
The Company designs, develops and markets a portfolio of portable
and network-based products for installing, maintaining and
monitoring fiber optic circuits and networks. Network operators
and telecommunications service providers use fiber optics to
provide increased network bandwidth to transmit voice and other
non-voice traffic such as internet, data and multimedia video
transmissions. The Company provides telecommunications service
providers and equipment manufacturers with product capabilities to
cost-effectively deploy and manage fiber optic networks. The
Company's product lines include: Network Information Computers,
Network Access Agents, Optical Test Systems, and Optical
Wavelength Managers. The Company's wholly owned subsidiaries are
Digital Lightwave (UK) Limited, Digital Lightwave Asia Pacific
Pty, Ltd., and Digital Lightwave Latino Americana Ltda.
As of Sept. 30, 2005, Digital Lightwave's equity deficit widened
to $44,696,000 from a $29,146,000 deficit at Dec. 31, 2004.
EAGLE FOOD: Unsecured Creditors Receiving Another 2% Distribution
-----------------------------------------------------------------
The Board of Directors of Reorganized Eagle Food Centers, Inc.
approved a second distribution to allowed general unsecured
creditors of approximately 2% of the allowed claim amount. This
distribution is in addition to the approximate 14.67% distribution
made in May of 2005. The total amount of allowed general
unsecured claims is $107.2 million. Pursuant to the Plan, and as
approved by the Board, the disputed claims reserve is revised to
$0.8 million for disputed general unsecured claims and general
unsecured convenience class claims. The funds approved for
distribution will be made available to the disbursing agents on
Dec. 19, 2005.
Further distributions will be made, as provided in the Plan, if
and when funds are available.
Headquartered in Milan, Illinois, Eagle Food Centers Inc.,
operates a regional supermarket chain. The Company and its
debtor-affiliates filed for chapter 11 protection on April 7, 2003
(Bankr. N.D. Ill. Case No. 03-15299). George N. Panagakis, Esq.,
at Skadden Arps Slate Meagher & Flom represents the Debtors in
their restructuring efforts. As of Nov. 2, 2002, the Debtors
listed $180,208,000 in assets and $177,440,000 in debts.
The U.S. Bankruptcy Court confirmed the Plan on March 25, 2004.
The Plan became effective on April 8, 2004, and all preferred and
common stock was cancelled.
ECOLOCLEAN INDUSTRIES: Equity Deficit Tops $1.2 Mil. at Sept. 30
----------------------------------------------------------------
Ecoloclean Industries, Inc., incurred a $549,566 net loss for the
quarter ended Sept. 30, 2005, as compared to a $871,573 net loss
for quarter ended Sept. 30., 2005.
The Company reported $86,044 of revenues from continuing
pperations for the three months ended Sept. 30, 2005, in contrast
to zero revenues for the three months ended Sept. 30, 2004. The
increased revenues of $86,044 were due to $63,788 of revenues
from the Company's newly acquired subsidiary, Aquatronics
Industries, Inc., and $22,256 of revenues from its World
Environmental Technologies, Inc., subsidiary.
At Sept. 30, 2005, the Company's balance sheet showed $1,512,051
in total assets and liabilities of $2,754,028, resulting in a
stockholders' deficit of $1,241,977.
Going Concern Doubt
Baum & Company, PA, expressed substantial doubt about Ecoloclean's
ability to continue as a going concern after it audited the
Company's financial statements for the years ended Dec. 31, 2004
and 2003. The auditing firm pointed to the Company's recurring
losses from operations and net capital deficiency.
About Ecoloclean
Ecoloclean Industries, Inc. -- http://www.ecoloclean.com/-- is
the parent company of three wholly owned operating subsidiaries:
Ecoloclean, Inc., World Environmental Technologies, Inc., and
Aquatronics Industries, Inc. Utilizing various remediation
techniques and technologies, Ecoloclean Industries provides
environmental waste remediation to treat and remove impurities in
contaminated and/or polluted liquids for a variety of industries
including, but not limited to, refineries, petroleum related
industries and oil and gas drillers. ECCI continues to seek
technologies and procedures that will offer its clients the safest
and most cost effective technologies available in the marketplace.
EDGEWATER FOODS: Lopez Blevins Raises Going Concern Doubt
---------------------------------------------------------
Lopez, Blevins, Bork & Associates, LLP, expressed substantial
doubt about Edgewater Foods International, Inc.'s ability to
continue as a going concern after it audited the Company's
financial statements for the fiscal year ended Aug. 31, 2005. The
auditing firm pointed to the Company's losses from operations,
negative net worth and working capital deficit.
Fiscal 2005 Results
Edgewater Foods incurred a $350,076 net loss on $315,869 of
revenues for the year ended Aug. 31, 2005, versus a $134,885 net
loss on $449,928 of revenues in the prior year. The decrease in
revenue from 2004 to 2005 is attributed to increased emphasis on
the development and production of larger 2005 and 2006 scallop
crops.
At Aug. 31, 2005, the Company's balance sheet showed $1,689,935 in
total assets and liabilities of $3,047,885, resulting in a
stockholders' deficit of $1,357,950. As of Aug. 31, 2005, the
Company had a cash balance of $560.
Edgewater Foods' current assets exceed current liabilities by
approximately $2,109,047 at Aug. 31, 2005. The Company's working
capital has been primarily financed with various forms of debt.
Management intends to obtain working capital through operations
and to seek additional funding through debt and equity offerings.
Key Corporate Objectives
Over the next 36 months, Edgewater Foods intends to expand
scallops and sablefish production at its facilities in Qualicum
Beach, Canada. The increased production is expected to generate
approximately $41.6 million in annual sale and approximately $18.2
million of earnings by the end of 2008.
Management plans to implement seven initiatives to achieve the
Company's objectives:
a) increase scallops sales from approximately $334,000 per
year to approximately $5 million for the year ending 2006
using existing seed stock and inventory.
b) produce at least 12 million scallops for the 2006 harvest
and implement planned scallop raising techniques that will
enhance sales & profitability growth in 2006 and beyond.
c) capitalize on the high demand for sablefish in foreign
markets by entering into the market for mature sablefish
by 2006.
d) expand current distribution by establishing new strategic
relationships with 10-15 American fisheries importers in
Seattle, Portland, San Francisco, San Jose, and Los
Angeles in 2006.
e) during 2006 and 2007, rapidly increase farm production
with a projected minimum scallop harvest of more than 30
million scallops in 2007 and 60 million scallops in 2008.
f) produce 200 million scallop seeds in 2008, with a
projected 2009 harvest of at least 100 million scallops.
About Edgewater Foods
Headquartered in Qualicum Beach, B.C., Edgewater Foods
International Inc. -- http://www.edgewaterfoods.com/-- is the
parent company of Island Scallops Ltd., a Vancouver Island
aquaculture company. ISL was established in 1989 and for over 15
years has successfully operated a scallop farming and marine
hatchery business. ISL is dedicated to the farming, processing
and marketing of high quality, high value marine species: scallops
and sablefish. Scallop farming is relatively new to North America
and ISL is the only producer of both live-farmed Pacific scallops
and live sablefish.
ESCANABA TIMBER: S&P Withdraws Low-B Debt Ratings
-------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'B' corporate
credit rating and 'BB-' senior secured debt rating on Escanaba
Timber LLC at the company's request.
On Nov. 15, 2005, Escanaba completed the sale of its timberlands
to Plum Creek Timber Co. for $345 million and paid off its
existing term loan.
ESPERANZA VILLAGE: Case Summary & 17 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Esperanza Village Partners, LLC
14810 East Coachman Drive
Black Forest, Colorado 80908
Bankruptcy Case No.: 05-53030
Chapter 11 Petition Date: December 19, 2005
Court: District of Colorado (Denver)
Judge: Howard R. Tallman
Debtor's Counsel: Lee M. Kutner, Esq.
Kutner Miller, P.C.
303 East 17th Avenue, Suite 500
Denver, Colorado 80203
Tel: (303) 832-2400
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 17 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Express Personnel Trade Debt $35,666
5310 North Montebello Lane
Colorado Springs, CO 80918
Labor Finders Trade Debt $33,311
P.O. Box 134
Colorado Springs, CO 80901
Payless Carpets Trade Debt $28,515
2456 C Montebello Square Drive
Colorado Springs, CO 80918
Jaguar Electric Trade Debt $6,133
Saint Paul Travelers Trade Debt $4,621
Home Depot Trade Debt $4,393
Griffis/Blessing Trade Debt $2,500
Powers Plumbing Trade Debt $2,428
Gazette Trade Debt $1,875
Oasis Landscaping Trade Debt $1,661
Stone Harbor Construction Trade Debt $1,471
Dunham, Doug Trade Debt $1,324
Kwai Trade Debt $1,158
Rodriguez, Jose Trade Debt $1,100
HPC Publications Trade Debt $1,089
Wilmar Trade Debt $951
Sign Shop Trade Debt $921
FEDERAL-MOGUL: M&F Subsidiary Expects to Resolve Asbestos Claims
----------------------------------------------------------------
M & F Worldwide Corp. (NYSE: MFW) reported that two of its
subsidiaries have reached a non-binding agreement in principle
with Cooper Industries LLC, one of its indemnitors, and
participants in the Federal-Mogul Products, Inc. bankruptcy on the
terms of a resolution of the Abex asbestos claims indemnified by
Cooper. Under this agreement, all of these asbestos claims will
be channeled to a trust to be established upon Federal-Mogul's
emergence from bankruptcy. By participating in this plan, the
Company expects to resolve all liability for asbestos claims
arising from a subsidiary's former Abex Friction Products
business. The proposed agreement is subject to:
* court approval,
* approval of 75% of the currently affected Abex asbestos
claimants,
* negotiation and execution of definitive documentation and
* certain other approvals.
The settlement will resolve more than 38,000 pending Abex claims.
Future claims will also be resolved through the bankruptcy trust,
and the Company will be protected against future claims by a court
injunction that will be effective upon Federal-Mogul's emergence
from bankruptcy.
The Company expects that the agreement in principle, when
consummated, will separate it from reliance on its indemnitors
with respect to the asbestos liability claims.
Terms of the Proposed Agreement Affecting Pneumo Abex
* A subsidiary of the Company will pay $10 million in cash
into the trust upon Federal-Mogul's emergence from
bankruptcy.
* The Company will simultaneously transfer to the trust the
Company's entire interest in Pneumo Abex LLC, a non-
operating, indirect subsidiary of the Company.
* Federal-Mogul will soon petition the court overseeing its
bankruptcy for a stay of all current claims subject to the
agreement. Upon Federal-Mogul's emergence from bankruptcy,
a court injunction will permanently bar any affected
asbestos claimant from pursuing a claim against M & F
Worldwide and certain related entities.
The Company, Federal-Mogul and Cooper have agreed to begin
drafting promptly the binding definitive documentation that will
implement this non-binding agreement in principle. Approval of
the agreement by the U.S. Bankruptcy Court for the District of
Delaware will be requested in the next few weeks.
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.
FIRST HORIZON: S&P Raises Low-B Ratings on Two Certificate Classes
------------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on 16
classes from six First Horizon Mortgage Pass-Through Trust
transactions, and affirmed its ratings on 321 classes from 24
transactions from the same issuer.
The upgrades reflect increased credit support percentages due to
the paydown of senior classes, very low cumulative losses, at
least 1.79x of credit support percentage at the new rating levels,
less than 50% of original pool balance, and at least two years
seasoning.
The affirmations reflect stable credit support percentages, as
well as good delinquency and loss performance.
As of the November 2005 distribution date, cumulative realized
losses ranged from 0% to 0.19%, and severe delinquencies ranged
from 0% to 1.69%.
Credit support is provided through a senior/subordinate structure
for each of the transactions. The pools were initially composed
of fixed- and adjustable-rate prime jumbo nonconforming mortgage
loans secured by first and second liens on owner occupied one- to
four-family dwellings.
Ratings Raised
First Horizon Mortgage Pass-Through Trust
Mortgage Pass-Thru Certs
Rating
Series Class To From
------ ----- -- ----
2000-H D-B-3 AAA AA+
2002-8 B-3 AA AA-
2002-9 B-1 AAA AA+
2002-9 B-2 AA A+
2002-9 B-3 A- BBB
2003-2 B-2 AA A+
2003-2 B-3 A BBB+
2003-2 B-4 BBB- BB
2003-2 B-5 BB- B
2003-AR1 B-1 AAA AA+
2003-AR1 B-2 AA AA-
2003-AR1 B-3 A- BBB+
2003-AR2 B-1 AA+ AA
2003-AR2 B-2 A+ A
2003-AR2 B-3 BBB+ BBB
Ratings Affirmed
First Horizon Mortgage Pass-Through Trust
Mortgage Pass-Thru Certs
Series Class Rating
------ ----- ------
2000-H I-A,II-A,I-B-1,II-B-1,III-B-1,IV-B-1 AAA
2000-H V-B-1,I-B-2,II-B-2,III-B-2,IV-B-2,V-B-2 AAA
2002-8 I-A-7,I-A-8,I-A-PO,II-A-1,B-1 AAA
2002-8 B-2 AA+
2002-9 I-A-3,II-A-1 AAA
2003-2 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-12 AAA
2003-2 II-A-1,II-A-2 AAA
2003-2 B-1 AA+
2003-3 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,II-A-1 AAA
2003-3 B-1 AA
2003-3 B-2 A
2003-3 B-3 BBB
2003-3 B-4 BB
2003-3 B-5 B
2003-4 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA
2003-4 I-A-8,I-A-9,I-A-10,I-A-11,II-A-1,II-A-2 AAA
2003-4 II-A-3 AAA
2003-4 B-1 AA
2003-4 B-2 A
2003-4 B-3 BBB
2003-4 B-4 BB
2003-4 B-5 B
2003-5 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA
2003-5 I-A-8,I-A-9,I-A-10,I-A-11,I-A-12,I-A-13 AAA
2003-5 I-A-14,I-A-15,I-A-16,I-A-17,I-A-18,I-A-19 AAA
2003-5 II-A-1,II-A-2,II-A-3,III-A-1 AAA
2003-5 B-1 AA
2003-5 B-2 A
2003-5 B-3 BBB
2003-5 B-4 BB
2003-5 B-5 B
2003-6 A-1,A-2,A-3,A-4,A-5,A-6,A-7,A-8,A-9 AAA
2003-6 B-1 AA
2003-6 B-2 A
2003-6 B-3 BBB
2003-6 B-4 BB
2003-6 B-5 B
2003-7 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA
2003-7 I-A-8,I-A-9,I-A-10,I-A-11,I-A-12,I-A-13 AAA
2003-7 I-A-14,I-A-15,I-A-16,I-A-17,I-A-18,I-A-19 AAA
2003-7 I-A-20,I-A-21,I-A-22,II-A-1 AAA
2003-7 B-1 AA
2003-7 B-2 A
2003-7 B-3 BBB
2003-7 B-4 BB
2003-7 B-5 B
2003-8 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA
2003-8 I-A-8,I-A-9,I-A-10,I-A-11,I-A-12,I-A-13 AAA
2003-8 I-A-14,I-A-15,I-A-16,I-A-17,I-A-18,I-A-19 AAA
2003-8 I-A-20,I-A-21,I-A-22,I-A-23,I-A-24,I-A-25 AAA
2003-8 I-A-26,I-A-27,I-A-28,I-A-29,I-A-30,I-A-31 AAA
2003-8 I-A-32,I-A-33,I-A-34,I-A-35,I-A-36,I-A-37 AAA
2003-8 I-A-38,I-A-39,I-A-40,I-A-41,I-A-42,I-A-43 AAA
2003-8 I-A-44,I-A-45,I-A-46,I-A-47, II-A-1 AAA
2003-8 B-1 AA
2003-8 B-2 A
2003-8 B-3 BBB
2003-8 B-4 BB
2003-8 B-5 B
2003-9 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA
2003-9 I-A-8,I-A-9,I-A-10,I-A-11,I-A-12,I-A-PO AAA
2003-9 II-A-1 AAA
2003-9 B-1 AA
2003-9 B-2 A
2003-9 B-3 BBB
2003-9 B-4 BB
2003-9 B-5 B
2004-2 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA
2004-2 I-A-8,I-A-9,II-A-1,III-A-1 AAA
2004-2 B-1 AA
2004-2 B-2 A
2004-2 B-3 BBB
2004-2 B-4 BB
2004-2 B-5 B
2004-3 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,II-A-1 AAA
2004-3 B-1 AA
2004-3 B-2 A
2004-3 B-3 BBB
2004-3 B-4 BB
2004-3 B-5 B
2004-4 I-A-1,I-A-2,I-A-3,I-A-4,I-A-5,I-A-6,I-A-7 AAA
2004-4 I-A-PO,II-A-1,II-A-2,II-A-3,II-A-4 AAA
2004-4 B-1 AA
2004-4 B-2 A
2004-4 B-3 BBB
2004-4 B-4 BB
2004-4 B-5 B
2004-5 I-A-1,I-A-2,I-A-3,I-A-4,I-A-PO,II-A-1 AAA
2004-5 II-A-PO AAA
2004-5 B-1 AA
2004-5 B-2 A
2004-5 B-3 BBB
2004-5 B-4 BB
2004-5 B-5 B
2002-AR2 I-A-1,II-A-1,III-A-1,B-1 AAA
2002-AR2 B-2 AA
2002-AR2 B-3 A-
2003-AR1 I-A-1,II-A-1,III-A-1 AAA
2003-AR1 B-4 BB
2003-AR1 B-5 B
2003-AR2 I-A-1,II-A-1,III-A-1 AAA
2003-AR2 B-4 BB
2003-AR2 B-5 B
2003-AR3 I-A-1,II-A-1,III-A-1 AAA
2002-AR3 B-1 AA
2002-AR3 B-2 A
2002-AR3 B-3 BBB
2003-AR3 B-4 BB
2003-AR3 B-5 B
2004-AR1 I-A-1,II-A-1,III-A-1,III-A-2 AAA
2004-AR1 B-1 AA
2004-AR1 B-2 A
2004-AR1 B-3 BBB
2004-AR1 B-4 BB
2004-AR1 B-5 B
2004-AR2 I-A-1,II-A-1,III-A-1,IV-A-1 AAA
2004-AR2 B-1 AA
2004-AR2 B-2 A
2004-AR2 B-3 BBB
2004-AR2 B-4 BB
2004-AR2 B-5 B
2004-AR3 I-A-1,II-A-1,III-A-1,IV-A-1 AAA
2004-AR3 B-1 AA
2004-AR3 B-2 A
2004-AR3 B-3 BBB
2004-AR3 B-4 BB
2004-AR3 B-5 B
2004-AR4 I-A-1,II-A-1,III-A-1,IV-A-1 AAA
2004-AR4 B-1 AA
2004-AR4 B-2 A
2004-AR4 B-3 BBB
2004-AR4 B-4 BB
2004-AR4 B-5 B
2004-AR7 I-A-1,II-A-1,II-A-2,II-A-3,II-A-4 AAA
2004-AR7 III-A-1,IV-A-1 AAA
2004-AR7 B-1 AA
2004-AR7 B-2 A
2004-AR7 B-3 BBB
2004-AR7 B-4 BB
2004-AR7 B-5 B
FOAMEX INT'L: Court Okays Setoffs with Four Major Creditors
-----------------------------------------------------------
Foamex LP previously asked the U.S. Bankruptcy Court for the
District of Delaware to approve four stipulations:
1. Milliken Stipulation
Milliken & Company owes Foamex LP $1,294,914 for goods
provided to Milliken before the Petition Date. Foamex, in
turn, owes Milliken $1,724,782 for fabric goods provided to
Foamex by Milliken before the Petition Date.
The parties agree that the automatic stay will be lifted to
solely permit the set-off of the Milliken and the Foamex
prepetition obligations. As a result of the set-off, Foamex
agrees that it owes Milliken $429,868.
Foamex will pay Milliken the Net Receivable in full in cash
immediately after the Court approves Foamex's request.
Foamex has previously obtained Court authority to pay the
Foamex/Milliken Net Receivable pursuant to the Final Order
Authorizing Payment of Prepetition Claims of Critical Vendors.
B. Kawshima Stipulation
Kawashima Textile USA Inc. owes Foamex $1,807,873 for
automotive foam products sold to Kawashima before the Petition
Date. In turn, Foamex owes Kawashima $1,690,128 for textile
products sold to Foamex by Kawashima prepetition.
The parties agree that the automatic stay will be lifted for
the sole and express purpose of permitting the set-off of the
Kawashima and the Foamex prepetition obligations. With the
set-off, Kawashima agrees that it owes $117,745 to Foamex.
Kawashima will pay Foamex the Net Receivable in full in cash.
C. FFI Stipulation
Future Foam Inc. owes Foamex $199,420 for products sold to FFI
prepetition. Foamex, in turn, owes FFI $179,041 for products
sold to Foamex prepetition.
The parties agree that the automatic stay will be lifted to
set-off the FFI and the Foamex prepetition obligations.
Pursuant to the set-off, the parties agree that FFI owes
$20,379 to Foamex.
FFI will pay Foamex the Net Receivable in full in cash.
D. BASF Stipulation
Foamex paid $613,350 on September 16, 2005, to BASF
Corporation as a deposit for new shipments. Foamex owes
BASF $301,509 on account of two outstanding invoices.
The parties agree that BASF will apply the amount of the BASF
Invoices from the Payment, and will treat the remaining amount
of the Payment as cash in advance deposit for postpetition
deliveries by BASF to Foamex. Foamex International Inc., and
its debtor-affiliates and BASF agree that the automatic stay
will be lifted only to the extent necessary to allow for set-
off of the mutual debts.
Pauline K. Morgan, Esq., Young Conaway Stargatt & Taylor LLP, in
Wilmington, Delaware, assures the Court that the Stipulations
were negotiated at arm's length, and both the Debtors and the
Creditors carefully scrutinized the amount and legitimacy of each
other's alleged claims. Foamex believes that the Stipulations
are fair and reasonable.
Committee Responds
Kenneth A. Rosen, Esq., at Lowestein Sandler PC, in Roseland, New
Jersey, tells the Court that the Official Committee of Unsecured
Creditors has no objection to the specific setoffs proposed.
However, given the language contained in the preambles, the
Committee asks the Court to direct the Debtors to clarify and
confirm that, except for the setoffs described in the
Stipulations, the Debtors' estates are not waiving or settling
any claims or rights against any Setoff Party, including but not
limited to, any avoidance action that the Debtors' estates may
hold against each Setoff Party.
* * *
The Court approves each of the Stipulations and lifts the
automatic stay to permit the parties to effect the setoff as
provided in the Stipulations.
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. 8; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
FOAMEX INT'L: Continental & Sealy Wants Automatic Stay Lifted
-------------------------------------------------------------
Sealy, Inc., and Foamex International, Inc., are parties to a
Supply Agreement dated January 1, 2002. Sealy supplies baled
mattress scrap for use in Foamex's manufacture of flexible
polyurethane foam for bedding.
In the Supply Agreement, Foamex agreed to extend to each of
Sealy's affiliates, either held by Sealy or Sealy's owner Bain
Funds, the same terms and conditions of the Agreement. Bain
Funds has a significant ownership interest in Sealy Mattress
Manufacturing Company, Inc.
The Insurance Section of the Supply Agreement obligated Foamex to
obtain commercial automobile liability insurance and name Sealy
as an additional insured. The insurance Foamex obtained for
Sealy will be primary to any other valid and collectible
insurance. Sealy's affiliates are provided with the same
additional insured primary coverage.
Consistent with the Supply Agreement's insurance requirements,
Foamex procured an American Home Auto Policy, effective October 2,
2001, to October 2, 2002. The Auto Policy contains an Additional
Insured endorsement that affords additional insured status to any
entity who becomes an additional insured, as a result of any
contract, only with respect to liability arising out of the
operations or premises owed or rented.
On September 25, 2002, Delbert Wardwell, Sr., while doing his job
as a material handler for Foamex in Morristown, Tennessee, was
seriously injured while unloading a trailer containing bundles of
Sealy's baled mattress scrap. The trailer containing the bundles
of baled mattress scrap had been loaded at Sealy's High Point,
North Carolina plant and transported by an employee of Satterfield
Trucking Corporation to Foamex's Morristown, Tennessee facility.
On December 31, 2002, Mr. Wardwell and his wife, Constance
Wardwell, filed a lawsuit against Sealy Mattress and Satterfield
at Morristown, Hamblen County, in Tennessee. The Wardwells sought
$6,000,000 for Mr. Wardwell and $3,000,000 for Ms. Wardwell.
On September 8, 2005, Continental Casualty Company and its
insured, Sealy, commenced a declaratory judgment action against
Foamex International Inc., and its debtor-affiliates and their
insurance carrier, American Home Assurance Company, in the
District Court for the Southern District of New York.
In the Declaratory Judgment Action, Continental and Sealy sought
a determination that:
(1) American Home had a duty to defend and indemnify Sealy in
connection with the Tennessee lawsuit; and
(2) Foamex has breached its contractual obligation to Sealy by
failing to procure the insurance required by the parties'
contract because American Home did not provide coverage
for Sealy for the Tennessee Lawsuit.
Despite Continental and Sealy's numerous requests, American Home
repeatedly refused to acknowledge its coverage obligations to
Sealy. Accordingly, Sealy's own carrier, Continental, defended
Sealy in the Lawsuit pursuant to a business auto policy. On
September 12, 2005, Sealy Mattress and Satterfield settled with
the Wardwells for $1,900,000. Continental and Sealy's share of
the amount was $900,000.
Continental and Sealy do not intend to pursue Foamex in the
Declaratory Judgment Action, James E. Drnec, Esq., at Morris,
James, Hichens & Williams, LLP, in Wilmington, Delaware, says.
Rather, Continental and Sealy seek to pursue American Home to
recover insurance proceeds that are rightfully theirs as
additional insureds under the insurance policies American Home
issued to Foamex.
Hence, Continental and Sealy ask the U.S. Bankruptcy Court for the
District of Delaware to terminate the automatic stay to permit
them to litigate their claims for insurance coverage against
American Home in the Declaratory Judgment Action.
Mr. Drnec assures the Court that Foamex will not suffer any
prejudice if the stay is lifted. Continental and Sealy will only
be seeking discovery from Foamex, he explains. Continental and
Sealy have no interest in pursuing the breach of contract claim
against Foamex in the Declaratory Judgment Action if the stay is
modified. Instead, Continental and Sealy intend to file a proof
of claim with the Court with respect to the claim.
If Continental and Sealy are successful in their claims against
American Home in the Declaratory Judgment Action, their breach of
contract claim against Foamex will be effectively eliminated,
thereby benefiting the estate, Mr. Drnec asserts.
In contrast, Mr. Drnec points out, there is considerable
prejudice to Continental and Sealy if they are not allowed to
continue their Declaratory Judgment Action, since they have a
substantial claim against American Home. Continental and Sealy
primarily seek to recover the $900,000 and attendant litigation
expenses that Continental paid on Sealy's behalf in settlement of
the Lawsuit because of American Home's wrongful refusal to defend
and indemnify Sealy in connection with that matter.
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. 8; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
FOAMEX INT'L: Court Okays Stipulation With Three Utilities
----------------------------------------------------------
As previously reported in the Troubled Company Reporter on
Oct. 28, 2005, the Honorable Peter J. Walsh of the U.S. Bankruptcy
Court for the District of Delaware granted Foamex International
Inc., and its debtor-affiliates' motion to preclude Utility
Companies from altering, refusing or discontinuing services on
account of unpaid prepetition invoices or prepetition claims on
the basis of the Debtors' bankruptcy filing or any outstanding
prepetition invoice.
* * *
Duke Power Company, Progress Energy Florida and Southern
California Edison Company are listed as Utilities in the Debtors'
Utilities Motion.
To settle all issues regarding the provision of adequate
assurance, the Debtors and the Utilities stipulate that:
(a) The Debtors will pay Duke's prepetition claim for $33,303
as adequate assurance of future payment in lieu of a
postpetition deposit.
(b) The Debtors will pay Progress $52,233 and maintain a
surety bond for $48,000 as adequate assurance of
postpetition payments.
(c) SCE can recoup the $417,040 cash deposit, plus $21,437 in
accrued interest against the Debtors' $218,752 prepetition
debt. SCE will apply the $219,724 credit that remains
after the recoupment to a $110,980 postpetition deposit
with the remainder applying as a credit on the
postpetition accounts.
If the Debtors fail to immediately pay the Utilities, the
applicable Utility is authorized to terminate service to the
Debtors after providing confirmed written notice of the default.
If the Debtors timely cure the default, the applicable Utility
will not terminate its services to the Debtors.
Any undisputed charge for utility services furnished by the
Utilities to the Debtors postpetition will constitute an
administrative expense.
Judge Walsh approves the Stipulation.
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. 8; Bankruptcy Creditors' Service, Inc., 215/945-
7000)
FORD MOTOR: Share Losses Prompts Fitch to Cut Ratings to BB+
------------------------------------------------------------
Fitch Ratings has downgraded the issuer default rating and senior
unsecured debt ratings of Ford Motor Company, Ford Credit Company
and affiliate ratings to 'BB+' from 'BBB-'. The ratings of The
Hertz Corporation and its subsidiaries are not affected by this
action. Ford's Rating Outlook remains Negative.
The downgrade and Negative Outlook reflect:
* the continuing share losses and competitive pressures at
Ford's core North American auto operations, and
* the challenges the company faces in restoring sustainable
positive cash flow.
Ford, along with most of the North American auto industry, is in
the midst of an extended and fundamental restructuring of its cost
base, which will be necessary to stem operating losses.
The deterioration in Ford's core SUV products has had a
disproportionate impact on consolidated profitability, with higher
gas prices and shifts in consumer preferences providing
uncertainty as to the extent of the decline going into 2006. Ford
has a number of competitive product offerings that should provide
some support to consolidated volumes and revenues, but the company
will nevertheless remain challenged to sustain revenues given
price pressures and the trend toward lower-priced vehicles.
Inability to sustain revenues would further stress Ford's
operating profile given the company's legacy costs.
Recent successful product introductions in the car segment have
led to unit sales gains and should provide continuing strength in
this segment into 2006, providing some offset to consolidated
revenue pressures. Ford has a moderate presence in the
rapidly-growing crossover segment, with two new products in this
category scheduled for release in late 2006. Otherwise, Ford's
new product introductions will be light over the next several
years. Although the large pickup segment has held up well, Ford
will face increasing competition in terms of new and refreshed
product competition competitive in 2006 as well as ever-present
price competition. Operating losses have also occurred despite a
healthy economic environment that has helped produce healthy
industry sales volumes, indicating vulnerability to any
deterioration in economic conditions over the near term. Warranty
costs, which have grown meaningfully over the past several years,
have impaired cash flows and remain a concern.
Ford will be reliant on significant cost reductions to stabilize
margins and cash flows. Ford has announced its intent to close
numerous assembly and component plants in addition to those
recently acquired from Visteon. Given the progress Ford has made
in portions of its product portfolio, target demographics and
manufacturing footprint, the company's unprofitable product lines
and uncompetitive manufacturing operations are relatively
identifiable. Ford has more than adequate liquidity over the near
term to finance the required employee buyout programs and closure
of facilities, although the pace and extent of the restructuring
will be dependent on Ford's progress in negotiations with the UAW.
The ability to accelerate restructuring activities could leave
Ford with a smaller, but more viable combination of flexible
manufacturing plants and product segments, with better plant
economics. However, replacing unit sales to support revenue
levels will remain a difficult challenge given the unrelenting
competitive environment. In its restructuring efforts, as with
its recent health care agreement, Ford is expected to benefit from
the urgency of the accelerated restructuring program being
undertaken by GM.
Operating results have also been severely impacted by higher
commodity costs, namely steel and resin, which may continue to
rise for Ford through 2006. Longer term, commodity price relief
may alleviate some margin pressure although this may not occur
until into 2007. Given top-line pressures and reduced scale,
fixed-cost absorption will continue to be challenging, and margin
restoration will be difficult to accomplish without more
significant inroads into structural costs in the areas of wages
and benefits.
Pension and health care costs remain a concern. Total health care
expenditures were $3.1 billion in 2004, and have been increasing
annually at double-digit rates, although this will now be off of a
moderately lower base following the recent health care agreement.
Ford remains moderately under funded in its US pension plans,
although pension legislation could accelerate required
contributions in an adverse scenario over the near term.
As of Sept. 30, 2005, Ford had healthy liquidity of $19.6 billion
in cash and S/T VEBA, as well as approximately $5.7 billion in L/T
VEBA. Expected net proceeds from the sale of Hertz of
$5.6 billion will provide supplemental liquidity to utilize in
Ford's restructuring program. Total debt of $18.2 billion is down
modestly over the past several years, and maturities are limited
to under $4 billion over the next fifteen years. Ford maintains
committed lines of $6.5 billion.
The ratings of Ford Motor Credit Co. are linked to those of Ford
due to the close business relationship between them. Fitch
expects FMCC's earnings and dividends to decline noticeably going
into 2006 primarily due to lower receivables outstanding and
margins. FMCC has benefited by lower provision expense, as the
quality of its receivables pool has increased, however, the pace
of these improvements is expected to slow going forward. Fitch
believes that FMCC maintains a good degree of liquidity relative
to its rating. Supporting this is FMCC's ability to sell or
securitize a broad spectrum of assets such as retail finance,
lease, and wholesale loans. Moreover, FMCC continues to hold high
cash balances and its assets mature faster than its debt.
Ratings lowered by Fitch with a Negative Rating Outlook include:
Ford Motor Co.
-- Senior debt to 'BB+' from 'BBB-';
-- Short-term to 'B' from 'F2'
Ford Motor Credit Co.
-- Senior debt to 'BB+' from 'BBB-';
-- Short-term to 'B' from 'F2'
FCE Bank Plc
-- Senior debt to 'BB+' from 'BBB-';
-- Short-term to 'B' from 'F2'
Ford Capital B.V.
-- Senior debt to 'BB+' from 'BBB-'.
Ford Credit Canada Ltd.
-- Senior debt to 'BB+' from 'BBB-';
-- Short-term to 'B' from 'F2'
Ford Motor Capital Trust II
-- Preferred stock to 'BB-' from 'BB'.
Ford Holdings, Inc.
-- Senior debt to 'BB+' from 'BBB-';
Ford Motor Co. of Australia
-- Senior debt to 'BB+' from 'BBB-';
Ford Credit Australia Ltd.
-- Senior debt to 'BB+' from 'BBB-';
-- Short-term to 'B' from 'F2'
PRIMUS Financial Services (Japan)
-- Senior debt to 'BB+' from 'BBB-';
-- Short-term to 'B' from 'F2'
Ford Credit de Mexico, S.A. de C.V.
-- Senior debt to 'BB+' from 'BBB-';
Ford Motor Credit Co. of New Zealand
-- Senior debt to 'BB+' from 'BBB-';
-- Short-term to 'B' from 'F2'
Ford Motor Credit Co. of Puerto Rico
-- Short-term to 'B' from 'F2'
GRAFTECH INT'L: Corrado F. De Gasperis Resigns as CFO, VP & CIO
---------------------------------------------------------------
GrafTech International Ltd.'s Vice President, Chief Financial
Officer and Chief Information Officer, Corrado F. De Gasperis,
resigned effective immediately, to pursue other opportunities.
Mr. De Gasperis will remain an employee of GrafTech in support of
a transition through the year-end financial accounting and
reporting processes.
GrafTech is commencing a search for a replacement for Mr. De
Gasperis. In the interim, Craig S. Shular, GrafTech's Chief
Executive Officer, has been appointed by the Board of Directors of
GrafTech as the acting Chief Financial Officer and Principal
Accounting Officer.
Mr. Shular joined GrafTech in January 1999 and was its Chief
Financial Officer until May 2001. Mr. Shular has been a Certified
Public Accountant.
GrafTech International Ltd. -- http://www.graftech.com/-- is one
of the world's largest manufacturers and providers of high quality
synthetic and natural graphite and carbon based products and
technical and research and development services, with customers in
80 countries engaged in the manufacture of steel, aluminum,
silicon metal, automotive products and electronics. Graftech
manufactures graphite electrodes and cathodes, products essential
to the production of electric arc furnace steel and aluminum.
Graftech also manufactures thermal management, fuel cell and other
specialty graphite and carbon products for, and provide services
to, the electronics, power generation, semiconductor,
transportation, petrochemical and other metals markets. Graftech
is the leading manufacturer in all of our major product lines,
with 13 state of the art manufacturing facilities strategically
located on four continents.
At Sept. 30, 2005, GrafTech International Ltd.'s balance sheet
showed a $40 million stockholders' deficit compared to a
$53 million deficit at Dec. 31, 2004.
JACOBS INDUSTRIES: Panel Taps Stout Risius as Financial Advisor
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of Jacobs
Industries, Inc., asks the U.S. Bankruptcy Court for the Eastern
District of Michigan to employ Stout Risius Ross, Inc., as its
financial advisors.
Stout Risius will:
1) assist and advise the Committee in its communications with
the general creditor body regarding significant matters in
the Debtor's bankruptcy case;
2) assist and advise the Committee relative to the Debtor's
financial performance and its affairs, including review of
budgets, monthly operating reports, and actual results &
forecast information;
3) attend meetings and negotiate with the Debtors and their
representatives and prepare preference analyses, fraudulent
transfers and other analyses related to chapter 5
recoveries;
4) assist and advise the Committee in the review, analysis and
negotiation of any plan or plans of reorganization that may
be filed and in the review, analysis and negotiation of the
disclosure statement accompanying any plan or plans;
5) assist the Committee in the review, analysis and negotiation
of any financing agreements or possible sale of the Debtor's
assets; and
6) render all other financial advisory services to the
Committee that is necessary in the Debtor's chapter 11
case.
Vincent Pavlak, a member of Stout Risius, reports his Firm's
professionals bill:
Designation Hourly Rate
----------- -----------
Managing Directors $335 - $385
Directors & Managers $230 - $335
Sr. Analysts/Analysts $150 - $220
Paraprofessionals $50 - $115
Mr. Pavlak can be reached at:
Vincent Pavlak
Stout Risius Ross, Inc.
32255 Northwestern Highway, Suite 201
Farmington Hills, MI 48334
Telephone (248) 208-8800
Stout Risius assures the Court that it does not represent any
interest materially adverse to the Committee and is a
disinterested person as that term is defined in Section 101(14) of
the Bankruptcy Code.
Headquartered in Fraser, Michigan, Jacobs Industries, Inc.,
manufacturs automotive interiors in roll forming and channel,
stampings and assembled product. The company along with its three
affiliates filed for chapter 11 protection on Sept. 26, 2005
(Bankr. E.D. Mich. Case No. 05-72613). Charles J. Taunt, Esq.,
and Erika D. Hart, Esq., at Charles J. Taunt & Associates,
P.L.L.C., represents the Debtors in their restructuring. When the
Debtor filed for protection from its creditors, it listed
$19,513,913 in total assets and $21,413,576 in total debts.
JACOBS INDUSTRIES: Beringea LLC Approved as Investment Bankers
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan
gave Jacobs Industries, Inc., permission to employ Beringea, LLC,
as its investment bankers.
Beringea will:
1) conduct sell-side due diligence on the Debtor and prepare
divestiture information describing the Debtor, its
operations and financial performance;
2) assist in identifying potential acquirers of the Debtor's
assets and negotiate the structure and terms of an asset
sale with prospective acquirers;
3) coordinate acquirer due diligence and assist in negotiating
a stalking horse bid, if appropriate;
4) conduct a court-directed auction among all potential
bidders for the asset sale and assist in the preparation and
negotiation of closing documentation for the proposed asset
sale; and
5) provide all other general financial advisory services to the
Debtor that is necessary in its chapter 11 case.
David S. Eberly, a Senior Managing Director of Beringea, discloses
that his Firm received a $30,000 retainer.
Mr. Eberly reports that Beringea will expect to receive:
a) a Transaction Fee equal to 2% of the transaction value of a
sale transaction completed during the Debtor's engagement of
Beringea and in no event will the Transaction Fee be less
than $250,000; and
b) a $45,000 Transaction Fee in the event that Beringea
completes a plan of reorganization for the Debtor that does
not include a sale transaction.
Beringea assures the Court that it does not represent any interest
materially adverse to the Debtor and is a disinterested person as
that term is defined in Section 101(14) of the Bankruptcy Code.
Mr. Eberly can be reached at:
David S. Eberly
Beringea, LLC
32330 W. 12 Mile Road
Farmington Hills, MI 48334
Telephone (248) 489-9000
Headquartered in Fraser, Michigan, Jacobs Industries, Inc.,
manufacturs automotive interiors in roll forming and channel,
stampings and assembled product. The company along with its three
affiliates filed for chapter 11 protection on Sept. 26, 2005
(Bankr. E.D. Mich. Case No. 05-72613). Charles J. Taunt, Esq.,
and Erika D. Hart, Esq., at Charles J. Taunt & Associates,
P.L.L.C., represents the Debtors in their restructuring. When the
Debtor filed for protectin from its creditors, it listed
$19,513,913 in total assets and $21,413,576 in total debts.
KAISER ALUMINUM: Court Okays Liquidation of Four Subsidiaries
-------------------------------------------------------------
Kaiser Aluminum Corp. reported that in furtherance of its overall
restructuring effort which focuses the Company's future primarily
on its fabricated products business, the U.S. Bankruptcy Court for
the District of Delaware confirmed the previously filed plans that
would liquidate four commodity subsidiaries.
Pursuant to the Court's order, the four liquidating commodity
subsidiaries are authorized to make partial distributions to
certain of their creditors, while reserving sufficient amounts for
future distributions until the Court resolves certain outstanding
disputes among the creditors of these subsidiaries and for the
payment of administrative and priority claims and trust expenses.
If the four liquidating commodity subsidiaries implement the plans
during 2005, it would likely reduce the Company's income tax
liability in respect of 2005.
The four affected subsidiaries are:
1. Alpart Jamaica Inc. and Kaiser Jamaica Inc., which had
owned the company's interests in an alumina refinery in
Jamaica that were sold in July 2004, and
2. Kaiser Alumina Australia Corporation and Kaiser Finance
Corporation, which had owned the company's interests in
respect of an alumina refinery in Australia that were sold
in April 2005.
The Court's ruling does not resolve a dispute between the holders
of the company's Senior Notes and the holders of the Company's
Senior Subordinated Notes regarding their respective entitlement
to certain of the proceeds from the sale of interests by the
Liquidating Subsidiaries. However, as a result of the Court's
approval, the company will pay all restricted cash and other
assets held on behalf of or by AJI, KJC, KAAC and KFC to a
trustee.
Partial Distributions
The trustee will then be authorized to make partial distributions
after setting aside sufficient reserves for amounts subject to the
Senior Note-Subordinate Note Dispute (approximately $213 million)
and for the payment of administrative and priority claims and
trust expenses (approximately $40 million). After such reserves,
the partial distribution is expected to total approximately
$430 million of which, pursuant to the Liquidating Plans,
approximately:
* $196 million will be paid to the Pension Benefit Guaranty
Corporation, and
* $202 million will be paid to the indenture trustees for the
Senior Notes for subsequent distribution to holders of the
Senior Notes.
Of the remaining partial distribution, approximately:
* $21 million will be paid to Kaiser Aluminum & Chemical
Corporation, the Company's principal operating subsidiary,
and
* $11 million will be paid to the PBGC on behalf of KACC.
All distributions, including future distributions, under the
Liquidating Plans will be made to the holders of claims as of the
close of business on Dec. 20, 2005. Initial, partial
distributions are expected to be made in late December 2005,
although no assurances can be provided as to the actual timing of
those distributions.
In connection with the effectiveness of the Liquidating Plans,
once the Liquidating Subsidiaries have paid the cash and other
assets to the trustee, the Liquidating Subsidiaries will be deemed
to be dissolved and they will take the actions necessary to
dissolve or otherwise terminate their corporate existence.
Alternative Minimum Tax
The company believes that it would likely have to pay
approximately $8.5 million of Alternative Minimum Tax in respect
of 2005 as a result of the 2005 gain on sale of its interest in
and related to the Australian alumina refinery. However, as
further disclosed in the September Form 10-Q, if the company's
plan of reorganization or the Liquidating Plans were approved and
implemented during 2005, certain tax attributes would likely be
available to reduce the 2005 AMT. Assuming that the Company is
able to implement the Court's ruling, for which there can be no
assurances, the Company currently estimates that it would reduce
the likely 2005 AMT amount by approximately $4.0 million. The
Company believes that any AMT amounts ultimately owed in respect
of 2005 will be reimbursed to the Company from the funds reserved
in respect of the Liquidating Plans, pursuant to an agreement with
the creditors.
The Court's ruling does not in any way affect the Company's plan
of reorganization, which has been overwhelmingly accepted by the
Company's creditors, and for which confirmation hearings are to be
held on Jan. 9 and 10, 2006.
Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications. The Company filed for chapter 11 protection on
February 12, 2002 (Bankr. Del. Case No. 02-10429), and has sold
off a number of its commodity businesses during course of its
cases. Corinne Ball, Esq., at Jones Day, represents the Debtors
in their restructuring efforts. On June 30, 2004, the Debtors
listed $1.619 billion in assets and $3.396 billion in debts.
KAISER ALUMINUM: Moves for Summary Judgment on Clark Public Claims
------------------------------------------------------------------
Kaiser Aluminum Corporation and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware for a summary
judgment regarding their motion to disallow and expunge the claims
of Clark Public Utilities.
Daniel J. DeFranceschi, Esq., at Layton, Richards & Finger, in
Wilmington, Delaware, tells the Court that there are no disputed
issues of material fact so the Clark claims should be disallowed
as a matter of law.
He notes that the litigation on the merits of the Clark claims has
already ended and that Clark has lost the litigation on the
merits. As a result, principles of res judicata preclude both the
unauthorized sale claim and the unreasonable rate claim, Mr.
DeFranceschi says.
As previously reported, Public Utility No. 1 of Clark County,
doing business as Clark Public Utilities, filed general unsecured
claims against Kaiser Aluminum & Chemical Corporation:
a. Claim Nos. 3122 in an unliquidated amount for certain
refund ordered by the Federal Energy Regulatory Commission
in an action commenced by Puget Sound Energy, Inc., a
utility company in the Pacific Northwest; and
b. Claim No. 7245 for $63,716,317 for certain disgorgement
ordered by the FERC for making a jurisdictional sale of
power without prior FERC authorization in violation of the
Federal Power Act.
Clark is a customer-owned municipal corporation that provides
electricity to 160,000 customers in Clark County, Washington.
Clark purchased all of its power through requirements contracts
with the Bonneville Power Administration, the sole federal power
marketing agency in the Pacific Northwest and the region's major
wholesaler of electricity.
In late 1996, however, Clark began purchasing power from other
suppliers. Clark timed its agreements with these suppliers so
that the agreements would expire on July 31, 2001, to coincide
with the expiration of its supply contract with the BPA. Due to a
change in the termination date of Clark's contracts with the BPA,
it created a two-month gap before the BPA can commence supplying
power under a new contract. So, Clark searched for a source of
power for the months of August and September 2001.
Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications. The Company filed for chapter 11 protection on
February 12, 2002 (Bankr. Del. Case No. 02-10429), and has sold
off a number of its commodity businesses during course of its
cases. Corinne Ball, Esq., at Jones Day, represents the Debtors
in their restructuring efforts. On June 30, 2004, the Debtors
listed $1.619 billion in assets and $3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 85; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
KENNETH MEAD: Court Sets Jan. 16 as General Claims Bar Date
-----------------------------------------------------------
The United States Bankruptcy Court for the Middle District of
Florida, Jacksonville Division, set January 16, 2006, as the
deadline for all creditors owed money by Kenneth H. Mead on
account of claims arising prior to October 14, 2005, to file their
proofs of claim.
Creditors must file written proofs of claim on or before the
January 16 Claims Bar Date and those forms must be delivered to:
Clerk of the Bankruptcy Court
300 N. Hogan Street, Suite 3-350
Jacksonville, Florida 32202
Headquartered in Ocala, Florida, Kenneth H. Mead filed for
chapter 11 protection on Oct. 14, 2005 (Bankr. M.D. Fla. Case
No. 05-13930). Ronald Bergwerk, Esq., at the Law Offices of
Ronald Bergwerk represents the Debtor. When Mr. Mead filed for
protection from his creditors, he listed estimated assets and
debts of more than $100 million.
KNIGHT FULLER: Incurs $11.6MM Net Loss in Quarter Ended Sept. 30
----------------------------------------------------------------
Knight Fuller, Inc., reported an $11.6 million net loss in the
quarter ended Sept. 30, 2005, as compared to a $571,000 net loss
for the quarter ended Sept. 30, 2005.
The net loss was due primarily to:
a) $7.2 million associated with the conversion of $6,719,800
and $448,815 (principal and accrued interest respectively)
of 10% convertible notes into an aggregate of 7,585,719
shares of common stock at a conversion price of 50% of the
market price;
b) $2.3 million associated with the issuance of common stock
to consultants for services; and
c) $1.4 million of costs with its rehearsals.com division.
The Company's revenues increased from $1.1 million for the
quarter ended Sept. 30, 2004 to $1.5 million for the quarter ended
Sept. 30, 2005. The increase was primarily attributable to an
increase in the number of televised award shows the Company
supported, resulting in increased revenues from production
services and music equipment rentals.
At Sept. 30, the Company's balance sheet showed $8,121,457 in
total assets and liabilities of $10,727,833, resulting in a
stockholders' deficit of $3,026,254.
Montage Partners Agreements
On Dec. 12, 2005, Knight Fuller entered into five agreements with
Montage Partners III, LLC:
1) Securities Purchase Agreement
2) Secured Debenture in the principal amount of $500,000;
3) Security Agreement;
4) Warrants covering 380,000 shares of Knight Fuller
common stock; and
5) Registration Rights Agreement.
Pursuant to these agreements:
-- Knight Fuller borrowed $500,000 from Montage, with
interest to accrue at 6% per annum, payable on June 12,
2006. Montage is entitled to convert all or a portion of
the outstanding principal amount and accrued interest on
the Secured Debenture into shares of Knight Fuller common
stock at a conversion price of $1.50 per share.
-- Knight Fuller issued to Montage fully vested and
exercisable warrants to purchase up to 380,000 shares of
Knight Fuller common stock at an exercise price of $1.60
per share, subject to the adjustment provisions of the
warrants. The warrants expire on Dec. 12, 2009.
-- Knight Fuller agreed in the Registration Rights Agreement
to file a registration statement with the Securities and
Exchange Commission that will register the resale of the
shares of Knight Fuller common stock that are issuable
pursuant to the Secured Debenture and the Warrants.
-- Knight Fuller gave Montage a security interest in Knight
Fuller's accounts receivable to secure its obligations
under the Secured Debenture, the Securities Purchase
Agreement, the Warrants and the Registration Rights
Agreement.
Going Concern Doubt
Cordovano and Honeck LLP expressed substantial doubt about Knight
Fuller, Inc.'s ability to continue as a going concern after it
audited the Company's financial statements for the year ended Dec.
31, 2004. The auditing firm pointed to the Company's significant
operating losses.
About Knight Fuller
Knight Fuller, Inc., is engaged primarily in:
a) providing production and support services for live musical
performances at televised award shows;
b) renting its studio facilities to musicians for rehearsal,
production and recording; and
c) renting musical instruments and related equipment for use
at its studios and other venues.
In 2004, the Company formed a division, rehearsals.com, to engage
in the ownership, development and commercial utilization of
entertainment content. The Company's business plan is to develop
and produce audio-visual content of various established musical
artists and partner with individuals or companies that control
various forms of established or developable content.
Additionally, the Company may promote artists with brand and
licensing partners.
KOEN BOOK: Court Okays Goldman Walker as Collection Agent
---------------------------------------------------------
The Honorable Judith H. Wizmur of the U.S. Bankruptcy Court for
the District of New Jersey gave Koen Book Distributors, Inc.,
permission to employ Goldman, Walker & DePoy, LLC, as its
collection agent.
Goldman Walker will:
(a) assist the Debtor with respect to the collection of
outstanding accounts receivables;
(b) assist the Debtor with respect to potential litigation of
the outstanding accounts receivables;
(c) draft documents necessary to pursue the outstanding
accounts receivables; and
(d) assist the Debtor with any meetings, negotiations and
hearings related to the outstanding accounts receivables.
Goldman Walker will be paid:
* 12% of accounts collected that do not require litigation; and
* 35% of accounts that proceed to litigation.
Upon successful collection of an account in litigation, the
settlement will be disbursed:
(a) Goldman Walker will be reimbursed for expenses from the
gross settlement amount; and
(b) the balance will be split between the Debtor and Goldman
Walker according to their agreement.
C.J. Walker, the president of Goldman, Walker & DePoy, LLC,
assures the Court that the Firm has no interest adverse to the
Debtor, its creditors or its estates.
Headquartered in Moorestown, New Jersey, Koen Book Distributors,
Inc. -- http://www.koen.com/-- is a book wholesaler specializing
in bestsellers and independent press titles. The company filed
for chapter 11 protection on July 11, 2005 (Bankr. D. N.J. Case
No. 05-32376). Aris J. Karalis, Esq., at Ciardi, Maschmeyer &
Karalis, P.C., represents the Debtor in its restructuring efforts.
When the Debtor filed for protection from its creditors, it listed
$10 million to $50 million in assets and debts.
KULLMAN INDUSTRIES: Taps BDO Seidman as Accountants & Advisors
--------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Kullman
Industries, Inc.'s chapter 11 proceedings asks the U.S. Bankruptcy
Court for the District of New Jersey for permission to employ BDO
Seidman, LLP, as its accountants and financial advisors, nunc pro
tunc to Nov. 7, 2005.
BDO Seidman will:
(a) analyze the Debtor's pre- and postpetition financial
operations as necessary;
(b) perform forensic investigating services as requested by the
Committee and counsel regarding the Debtor's prepetition
activities in order to identify potential causes of action;
(c) perform claims analysis for the Committee, as necessary;
(d) verify the physical inventory of supplies, equipment and
other material assets and liabilities, as necessary;
(e) assist the Committee in its review of monthly statements of
operations to be submitted by the Debtor;
(f) analyze the Debtor's budgets, cash flow projections,
restructuring programs, selling and general administrative
structure and other reports or analyses prepared by the
Debtor or its professionals in order to advise the Committee
on the status of the Debtor's operations;
(g) scrutinize cash disbursements on an on-going basis for the
period subsequent to the petition date;
(h) analyze transactions with insiders, related and/or
affiliated companies;
(i) prepare and submit reports to the Committee as necessary;
(j) assist the Committee in its review of the financial aspects
of a plan of reorganization to be submitted by the Debtor;
(k) attend meetings of creditors and conferences with
representatives of the creditor groups and their counsel;
(l) prepare hypothetical orderly liquidation analyses;
(m) monitor the sale and/or liquidation of any of the Debtor's
assets;
(n) analyze the financial ramifications of any proposed
transactions for which the Debtor seeks Bankruptcy Court
approval including, but not limited to, postpetition
financing, sale of all or a portion of the Debtor's assets,
management compensation and/or retention and severance
plans;
(o) render expert testimony on behalf of the Committee, as
agreed by BDO Seidman;
(p) provide assistance and analysis in support of potential
litigation (including avoidance power actions) that may be
investigated and/or prosecuted by the Committee;
(q) analyze transactions with the Debtor's financing
institution; and
(r) perform other necessary services as the Committee or counsel
to the Committee may request from time to time with respect
to the financial, business and economic issues that may
arise.
William K. Lenhart, a member of BDO Seidman, disclosed that his
Firm's professionals bill:
Designation Hourly Rate
----------- -----------
Partners $335 - $675
Senior Managers & Directors $230 - $510
Managers $210 - $345
Seniors $150 - $255
Staff $95 - $195
Mr. Lenhart assures the Court that his Firm does not represent any
interest adverse to the Debtor's estate.
Headquartered in Lebanon, New Jersey, Kullman Industries, Inc.
-- http://www.kullman.com/-- is a modular construction builder.
The company filed for chapter 11 protection on Oct. 17, 2005
(Bankr. D. N.J. Case No. 05-60002). James N. Lawlor, Esq., at
Wollmuth, Maher & Duetsch, LLP represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it estimated assets between $1 million and $10
million and debts between $10 million to $50 million.
KULLMAN INDUSTRIES: Taps Trenwith Securities as Investment Bankers
------------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Kullman
Industries, Inc.'s chapter 11 proceedings asks the U.S. Bankruptcy
Court for the District of New Jersey for permission to employ
Trenwith Securities, LLC, as investment bankers, nunc pro tunc to
Nov. 7, 2005.
Specifically, Trenwith, a majority owned subsidiary of BDO
Seidman, LLP, will:
(a) conduct a peer review of the Debtor's or its advisors'
marketing process, market materials and evaluate the
potential bidder universe for completeness;
(b) perform an independent evaluation of the pending stalking
horse proposal submitted by Kullman Acquisition Corp., Inc.,
in October 2005 and bidding procedures and making
recommendations that may increase the potential recovery to
the Debtors' estates;
(c) identify and contact persons or entities who are, or may
become, interested in bidding on the Debtor's assets at the
Auction;
(d) prepare marketing materials with respect to the auction and
distribute them to transaction sources;
(e) manage the due diligence process with transaction sources
through the auction;
(f) manage the negotiation and closing of one or more asset
purchase agreements;
(g) assist and advise the Committee regarding the relative
merits of alternative sales, other transactions and bids or
proposals submitted by transaction sources or otherwise in
connection with the auction;
(h) assist in preparing for the auction and in managing the bid
process and related tasks during the auction; and
(i) provide testimony in court on behalf of the Committee, if
necessary.
Ricardo S. Chance, a managing director of Trenwith, disclosed that
his Firm's professionals bill:
-- its regular hourly rate;
Designation Hourly Rate
----------- -----------
Managing Directors $495
Senior Vice Presidents $425
Vice Presidents $395
Analysts $295
Clerical $30
-- up to $35,000 in expense reimbursement, in the event that no
sale transaction exceeding the Debtor's proposed stalking
horse bid by Kullman Acquisition, Inc., is consummated;
-- more than $35,000 in expense reimbursement if the sale
exceeds the stalking horse bid;
-- a success fee equal to:
(i) 4% of the difference between the total Kullman initial
bid and the winning bid if KAI is approved as the
stalking horse but is not the winning bidder;
(ii) 4% of the difference between the Kullman initial bid
and KAI's winning bid if it is approved as the
stalking horse and is the winning bidder; or
(iii) 4% of the winning bid if KAI is not approved as the
stalking horse.
Mr. Chance assures the Court that his Firm does not represent any
interest adverse to the Debtor's estate.
Headquartered in Lebanon, New Jersey, Kullman Industries, Inc.
-- http://www.kullman.com/-- is a modular construction builder.
The company filed for chapter 11 protection on Oct. 17, 2005
(Bankr. D. N.J. Case No. 05-60002). James N. Lawlor, Esq., at
Wollmuth, Maher & Duetsch, LLP represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it estimated assets between $1 million and $10
million and debts between $10 million to $50 million.
KUSHNER-LOCKE: Can Access Lenders' Cash Collateral Until May 31
---------------------------------------------------------------
The Honorable Samuel L. Bufford of the U.S. Bankruptcy Court for
the Central District of California, Los Angeles Division,
authorized The Kushner-Locke Company and its debtor-affiliates to
use cash collateral securing repayment of indebtedness to JPMorgan
Chase Bank, as collateral agent and fronting bank for a group of
lenders. The Debtors have access to the encumbered fund from
Dec. 1, 2005, to May 31, 2006.
Kushner-Locke borrowed money under a Credit, Security, Guaranty
and Pledge Agreement dated June 19, 1996, from a consortium of
lenders for which JPMorgan Chase serves as the collateral agent.
Kushner-Locke's affiliates served as guarantors. As of their
bankruptcy filings, the Debtors' obligation under the agreement
totaled $67 million plus $8.9 million in accrued interest and
other fees.
To secure repayment of the loan, the lenders were granted security
interests in all of the Debtors' assets, including inventory,
receivables, cash, deposit accounts, copyrights, and other general
intangibles.
The Debtors need access to the encumbered funds for the
preparation of a plan of reorganization and, ultimately, their
exit from chapter 11.
To protect the lenders' interests, the Debtors grant them
administrative claims with priority over all other administrative
expenses and claims subject to the professional fee and
consultation fee carve-outs.
Headquartered in Los Angeles, California, The Kushner-Locke
Company is a low-budget movie production studio. The Company,
along with its debtor-affiliates filed for chapter 11 protection
on November 21, 2001 (Bankr. C.D. Calif. (L.A. Div.) Case No.
01-44828).
LAFOURCHE PARISH: Tax Revenue Decline Cues S&P to Cut Rating to BB
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on LaFourche
Parish Road Sales Tax District No. 5, Louisiana's series 2000
public improvement sales tax bonds to 'BB' from 'BBB-' due to the
deterioration of pledged sales tax revenues, which has reduced
debt service coverage to less than 1x annual debt service
requirements.
The speculative-grade rating also reflects:
* a shallow local economy;
* a limited retail sales base, resulting in per capita retail
sales that are below state and national averages; and
* uncertainty regarding future sales tax collections
post-Hurricane Katrina.
In addition, the rating reflects permissive legal provisions that
include a historical additional bonds test requiring average
annual revenues for two years preceding issuance to be at least
1.35x maximum annual debt service on outstanding and proposed
debt; and the area's wealth and income levels, which are on par
with state levels but are low compared with national levels.
The outlook is stable based on Standard & Poor's expectation that
sales tax collections have stabilized and that parish management
will maintain road district fund balances at a level sufficient to
cure a deficiency in pledged sales tax revenues without
significant reliance on the debt service reserve in order to meet
debt service requirements.
A special 1% sales tax instituted on Oct. 1, 1999, which will
remain in effect for 15 years, secures the bonds. The parish used
bond proceeds to fund the construction, improvement, and
resurfacing of its public roads and to finance a debt service
reserve fund.
Pledged sales tax collections, which began in October 1999, have
declined by a cumulative $113,506, or 11%, from $1.027 million in
fiscal 2002 to $913,559 in fiscal 2004. Boundary disputes between
road districts resulted in the transfer of sales tax revenues to
other adjacent road districts from district No. 5. Pledged sales
tax collections declined by $52,000, or 5.4%, in fiscal 2004
compared with the prior fiscal year and decreased by a similar
amount in fiscal 2003. Fiscal 2003 sales tax collections
decreased by 6% compared with fiscal 2002 due, in part, to the
December 2002 closure of a Kmart Corp. store, which was a leading
district sales tax generator. Fiscal 2004 pledged revenues were
insufficient to meet annual debt service requirements and provided
a weak 0.98x annual debt service coverage requirement. Parish
management tapped the road district No. 5 fund balance in fiscal
2004 by $11,090 to make debt service payments. The unreserved
fund balance for road district No. 5 totaled $196,835 as of fiscal
year-end 2004. The debt service reserve fund is fully funded at
$900,000, which is equal to 10% of bond proceeds. Year-to-date
sales tax collections through June 2005 reflect a 5% increase over
the same period in 2004. Currently, the total sales tax rate
collected in the district is 8.7%.
The rating action affects approximately $6.775 million in debt.
LEGACY ESTATE: U.S. Trustee Appoints 10-Member Creditors Committee
------------------------------------------------------------------
The United States Trustee for Region 17 appointed five creditors
to serve on an Official Committee of Unsecured Creditors in The
Legacy Estate Group LLC's chapter 11 case:
1. Kirkland/Knightsbridge LLC
Attn: Larry Kirkland
P.O. Box 5387
Napa, California 94581
Tel: (707) 254-9100
2. Tonnellerie Boute
Attn: Manuel Martinez
1001 Seascape Circle
Rodeo, California 94572
Tel: (510) 799-1518
3. Heritage Paper Co.
Attn: John Tatum
6850 Brisa Street
Livermore, California 94550
Tel: (925) 449-1148
4. Price Lanscape Services, Inc.
Attn: Thomas L. Price
P.O. Box 448
Napa, California 94559
Tel: (707) 252-6319
5. Scott Laboratories, Inc.
Attn: Jocelyne Hildebrand
P.O. Box 4559
Petaluma, California 94955
Tel: (707) 765-6666
6. World Cooperage Co., Inc.
Attn: David Waugh
P.O. Box 1659
Lebanon, Missouri 65536
Tel: (417) 588-4151
7. Universal Specialties, Inc.
Attn: Antonius Loog
1810 Kosmina Rd.
Vernon, BC, Canada, VIT 8T2
Tel: (250) 549-1323 Ext 214
8. Saint-Gobain Containers, Inc.
Attn: Thomas Fitzpatrick
1 New Bond Street
Worcester, Massachusetts 01615
Tel: (508) 795-5409
9. California Glass Company
Attn: Rick Silvari
155 98th Avenue
Oakland, California 94603
Tel: (510) 635-7700 Ext 120
10. Wilson Daniels Ltd.
Attn: R. Donald Cain
P.O. Box 440-B
St. Helena, California 94574
Tel: (707) 963-9661
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense. They may investigate the Debtors' business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent. Those
committees will also attempt to negotiate the terms of a
consensual chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtors is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.
Headquartered in Saint Helena, California, The Legacy Estate Group
LLC -- http://www.freemarkabbey.com/-- owns Freemark Abbey
Winery, which produces a range of red, white, and dessert wines.
Legacy Estate and Connaught Capital Partners, LLC, filed for
chapter 11 protection on November 18, 2005 (Bankr. N.D. Calif.
Case No. 05-14659). John Walshe Murray, Esq., Lovee Sarenas,
Esq., and Robert A. Franklin, Esq., at Law Offices of Murray and
Murray represent the Debtors in their restructuring efforts. When
the Debtors filed for protection from their creditors, they
estimated more than $100 million in assets and debts between $50
million and $100 million.
LEVITZ HOME: Closes and Liquidates Thirty-Four Stores
-----------------------------------------------------
Levitz Home Furnishings, Inc. reported that it will be focusing
future operations on the profitable West Coast and New York
metropolitan areas, exiting the Connecticut and greater
Philadelphia markets.
As previously reported in the Troubled Company Reporter, Levitz
Home Furnishings, Inc., and its debtor-affiliates sought and
obtained the U.S. Bankruptcy Court for the Southern District of
New York's authority to sell substantially all of their assets to
PLVTZ, LLC, an affiliate of Prentice Capital Management, LP, and
The Pride Capital Group LLC, doing business as Great American
Group, pursuant to an asset purchase agreement dated November 30,
2005.
"The decision to focus on our most profitable markets is a
strategic decision, designed to strengthen Levitz Home Furnishings
for the long term," said Jonathan Duskin, Managing Partner of
Prentice Capital Management LP. "We are taking these actions to
serve our customers more efficiently by strengthening our business
model and rationalizing our store base to better leverage our
marketing activities and improve our supply chain."
Following this operational realignment, Levitz will have 79 stores
in the profitable West Coast and New York metropolitan markets.
Stores scheduled for closing and liquidation over the coming weeks
include:
-- Connecticut: Danbury, Manchester, Milford, Newington,
Norwalk, Plainville and Stamford
-- Pennsylvania: Downington, Fairless Hills, Hatfield, King of
Prussia, Langhorne, Philadelphia, Plymouth
Meeting, Reading, Springfield and Whitehall
-- New Jersey: Cherry Hill, Deptford, Lawrenceville,
Livingston, Mays Landing, River Edge, and
Wall Township
-- Delaware: Claymont, Newark, and Wilmington
-- Minnesota: St. Paul
-- New York: Nesconset (Clearance Center) and Queens
(Queens Boulevard)
-- Arizona: Scottsdale
-- California: Cathedral City, Glendale (Clearance Center),
Oxnard
The liquidations will be handled by Great American Group, a
nationwide investment firm with extensive experience in furniture
industry asset performance optimization and disposition.
The Company will meet all of its obligations to its customers in
the markets it is exiting, including the fulfillment of all
existing orders with product.
The Company also said that it will continue to pay affected
employees through at least Jan. 31, 2006, and expects to make
every effort to place affected associates at remaining stores.
Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States. The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189). David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts.
MCI INC: Five Parties Balk at Verizon Common Stock Distribution
---------------------------------------------------------------
Five parties objected to WorldCom, Inc., and its debtor-
affiliates' request to distribute Verizon common stock pursuant to
the Merger Consideration:
1. Teleserve Systems, Inc.;
2. Communications Network International, Ltd.;
3. Liquidity Solutions, Inc.;
4. Rick Drew; and
5. TMB Communications, Inc., and Frank and Janice Mitchell.
The Objectors argue that they are entitled to a $5.60 Special
Dividend paid to shareholders who held MCI common stock on the
Record Date.
The Objectors further argue that the Debtors' failure to
distribute stock valued at $26 per share renders the Plan unfair
and discriminatory because other creditors will have received that
greater amount.
The Debtors' failure to distribute stocks valued at $26 per share
will result in an impermissible Plan modification in contravention
to Section 1127(b) of the Bankruptcy Code, according to the
Objectors.
Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP, in
Houston, Texas, points out that the Objectors did not hold MCI
common stock on the record date. Thus, they are not entitled to
receive the value of the Special Dividend.
Mr. Perez clarifies that the payment of the Special Dividend does
not result in a discriminatory or disparate treatment of any
claimant because it does not violate the Bankruptcy Code nor the
Plan. The Plan has been confirmed and nothing requested in the
Motion can transform a confirmed Plan into one that ex post facto
violates the Bankruptcy Code.
Furthermore, Mr. Perez asserts that the payment of the Special
Dividend does not seek to amend the Plan. The Plan simply does
not entitle claimants to the highest stock price achieved since
April 20, 2004, he explains. Rather, it entitles them to a fixed
amount of stock, without regard to the value that the stock may or
may not achieve.
Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532). On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts. The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc. (WorldCom
Bankruptcy News, Issue No. 109; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
* * *
As reported in the Troubled Company Reporter on Feb. 22, 2005,
Standard & Poor's Ratings Services placed its ratings of Ashburn,
Virginia-based MCI Corp., including the 'B+' corporate credit
rating, on CreditWatch with positive implications. The action
affects approximately $6 billion of MCI debt.
MIRANT CORP: Names Terry G. Dallas to Board of Directors
--------------------------------------------------------
Mirant (Pink Sheets: MIRKQ) named Terry G. Dallas as part of the
the company's nine-member board of directors. Appointments for
all board members become effective upon the company's emergence
from Chapter 11 bankruptcy protection, which is expected in the
first week of January 2006.
Mr. Dallas, 55, was executive vice president and chief financial
officer of Unocal Corporation from 2000-2005, when Unocal merged
with Chevron Corporation. Unocal developed crude oil and natural
gas properties in the Gulf of Mexico, Asia, Africa, and Latin
America.
Prior to his position at Unocal, Dallas held various executive
finance positions in his 21-year career with Atlantic Richfield
Corporation, an oil and gas company with major operations in the
United States, Latin America, Asia, Europe and the Middle East.
Mr. Dallas holds a BS from the Georgia Institute of Technology,
and an MBA from the University of California at Los Angeles. Mr.
Dallas also served as an officer in the United States Navy.
Mr. Dallas is the final appointment to Mirant's Board of
Directors, in accordance with Mirant's Plan of Reorganization.
Mr. Dallas satisfies the New York Stock Exchange definition of an
independent director and has no direct affiliation with any
members of Mirant's bankruptcy committees.
Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally. Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590). Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
* * *
As reported in the Troubled Company Reporter on Dec. 8, 2005,
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to power generator and developer Mirant Corp. The
outlook is stable. The rating reflects the credit profile of
Mirant, based on the structure the company expects to have on
emergence from bankruptcy at or around year-end 2005.
MORGAN STANLEY: Fitch Affirms Low-B Ratings on $31MM Class Certs.
-----------------------------------------------------------------
Fitch Ratings affirms Morgan Stanley Dean Witter Capital Inc.
commercial mortgage pass-through certificates, series 2003-TOP9:
-- $278.7 million class A-1 at 'AAA';
-- $610.8 million class A-2 at 'AAA';
-- Interest-only classes X-1 and X-2 at 'AAA';
-- $32.3 million class B at 'AA';
-- $35 million class C at 'A';
-- $12.1 million class D at 'A-';
-- $14.8 million class E at 'BBB+';
-- $6.7 million class F at 'BBB';
-- $5.4 million class G at 'BBB-';
-- $10.8 million class H at 'BB+';
-- $4 million class J at 'BB';
-- $5.4 million class K at 'BB-';
-- $5.4 million class L at 'B+';
-- $2.7 million class M at 'B';
-- $2.7 million class N at 'B-'.
Fitch does not rate the $10.8 million class O.
The affirmations are due to the stable pool performance and
scheduled amortization. As of the December 2005 distribution
date, the pool's aggregate principal balance has decreased 3.7% to
$1.04 billion from $1.08 billion at issuance.
Currently, two loans are in special servicing. Fitch expects
losses on one of the specially serviced loans, which will
minimally reduce the principal balance of the non-rated class O.
The largest of these loans is in foreclosure and is secured by a
29,844 square foot retail property in Orange, California.
According to the special servicer, a tentative settlement with the
borrower has been reached to reinstate the loan, which includes
bringing the loan current, payment of the trust's expenses, and
paying a portion of the default interest.
The six credit-assessed loans remain investment grade. Fitch
reviewed operating statement analysis reports and other
performance information provided by Wells Fargo, the master
servicer. The Fitch stressed debt service coverage ratio for the
loans is calculated based on a Fitch adjusted net cash flow and a
stressed debt service based on the current loan balance and a
hypothetical mortgage constant.
1290 Avenue of the Americas is secured by a 43-story class A
office building totaling 2 million sf, located in midtown
Manhattan, New York. The whole loan was divided into four pari
passu notes and a subordinate B-note. Only the $70 million A-1
note serves as collateral in the subject transaction. As of
year-end 2004, the Fitch stressed DSCR increased to 1.54 times
from 1.46x at issuance. Occupancy as of March 2005 is 94.1%
compared to 98.7% at issuance.
Oakbrook Center is secured by the fee interest in 942,039 sf of
owned retail space, 240,223 sf of office space in three buildings,
and the ground leases for a 172-room Renaissance Hotel, Nordstrom,
Neiman Marcus, and a Bloomingdale's Home Store in Oak Brook,
Illinois. The whole loan as of December 2005 has an outstanding
principal balance of $228.8 million and is divided into four pari
passu notes. Only the $67.8 million A-1 note serves as collateral
in the subject transaction. The Fitch stressed DSCR as of YE 2004
was 1.60x compared to 1.49x at issuance.
The remaining four credit-assessed loans -- 601 New Jersey Avenue,
Inland Portfolio, 10 G Street, Nebraska, and Parc East Tower --
have remained stable since issuance.
NEW BETTER: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: New Better Food Distributors, Inc.
dba Grover Shop N Bag
1024 Church Lane
Yeadon, Pennsylvania 19050
Bankruptcy Case No.: 05-39570
Chapter 11 Petition Date: December 16, 2005
Court: Eastern District of Pennsylvania (Philadelphia)
Judge: Kevin J. Carey
Debtor's Counsel: Paul Brinton Maschmeyer, Esq.
Ciardi, Maschmeyer & Karalis, P.C.
1900 Spruce Street
Philadelphia, Pennsylvania 19103
Tel: (215) 546-4500
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Katz, Marion $300,000
35 Matlack Drive
Voorhees, NJ 08043
Kallman, Robert $500,000
75 Hook Road
Bayonne, NJ 07002
Local #1776 Health & Welfare Fund $300,000
c/o Steven J. Bushinsky, Esq.
O'Brien, Belland & Bushinsky, LLC
2111 New Road, Suite 101
Northfield, NJ 08225
Fleming Co. $290,000
5701 North Shartel Avenue
Oklahoma City, OK 73118
White Rose Foods $200,000
380 Middlesex Avenue
Carteret, NJ 07008
Local #56 Health & Welfare Fund $140,300
Bay Trading $131,129
Bacharach, David $100,000
Seder Foods Corp. $90,000
Phila. Electric $60,000
Local #1776 Pension $52,500
Local #56 Pension $40,500
Porky's Products, Inc. $28,552
Kreider Farms $27,000
Tasty Baking Co. $27,000
Gleason Agency $20,000
Four Seasons Produce, Inc. $18,310
Local #56 Savings Plan $12,600
Quaker Valley Meats $10,400
Penn Jersey Paper Co. $10,200
NORTHWEST: PFAA Urges Steenland to Sign "Airline Bill Of Rights"
----------------------------------------------------------------
On behalf of its 9,700 members, the public, taxpayers and
customers, the Professional Flight Attendants Association today
urged Northwest Airlines President/CEO Doug Steenland to sign an
"Airline Bill of Rights" in an effort to make NWA executives
responsible to stakeholders of the airline.
The "Airline Bill of Rights" challenges Steenland and his
executives to join employees in offering the company realistic
concessions in order to fly the carrier out of bankruptcy, and
also serves as an outline for management accountability.
In a letter issued today to Steenland, PFAA President Guy D. Meek
reminded the CEO of past and continuing sacrifices the NWA Flight
Attendant group and others have made to support Northwest
Airlines.
"Last month, Northwest Flight Attendants sacrificed again to save
this company from liquidation. Flight Attendants took the
incredible step of temporarily providing the equivalent of $117
million in temporary annual wage reductions to the company while
this company emerges from bankruptcy," Mr. Meek wrote.
"Northwest Flight Attendants are not alone in their forfeitures to
your executive team. Creditors, investors and passengers have all
been asked to forego money, service and conveniences. Hub cities,
as well as state and federal governments have invested greatly in
Northwest Airlines are now facing future service
cutbacks, loss of community jobs to foreign countries, and
reduction of tax revenue."
Mr. Meek noted that in return for all the sacrifices made on
behalf of the airline that management must too participate in
concessions to demonstrate their long-term commitment, and
worthiness, to Northwest and its employees. "It would be
outrageous for NWA management to exploit this crisis and profit
while employees suffer and hurt," Mr. Meek said.
The "Airline Bill of Rights" calls for Steenland to reassess a
scheme that would allow the outsourcing of the positions of many
loyal, long-term employees to foreign-based employees and other
foreign nationals (including more than 2,500 Flight Attendants).
PFAA http://www.pfaa.com/or
Http://www.pfaa.com/News/Press/Default.asp represents the nearly
10,000 U.S.-based NWA Flight Attendants, who ensure the highest
levels of safety, security and service on the carrier's hundreds
of daily flights around the world.
Flight Attendants Start Campaign
Members of the Professional Flight Attendants Association this
Friday will begin canvassing Northwest Airlines hub airports with
flyers promoting the "Airline Bill of Rights" -- a campaign
tailored on
behalf of crew members, the flying public and tax payers of
America to bring accountability to out-of-control NWA executives.
Initially released December 9, the "Airline Bill of Rights"
specifically challenges NWA President/CEO Doug Steenland and his
executives to join employees in offering the company realistic
concessions in order to fly the carrier out of bankruptcy, and
further promotes responsible decision making processes that would
ensure the highest levels of safety for the flying public.
"We'll be asking our customers to sign on to this campaign, as we
believe Northwest must be accountable to the local, state and
national taxpayers, who have supported this airline in good times
and bad," said PFAA spokesperson Karen Schultz. "Also, our
Flight Attendants will be urging holiday travelers to send
messages to Mr. Steenland, petitioning him to reassess his scheme
to outsource the positions of many loyal, long-term employees to
foreign-based employees and other foreign nationals."
"We believe our customers will embrace the importance and
recognize the security implications of our push to keep good,
middle-class American jobs here in the United States, where they
rightfully belong," she added.
The campaign furthermore promotes responsible corporate
citizenship for Northwest Airlines, Schultz said, noting that
other airline unions throughout the country have expressed
interest in bringing the campaign to their carriers.
Airport canvassing is slated initially for December 16 and 23,
throughout peak travel periods.
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. (Northwest Airlines Bankruptcy News, Issue No. 13;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
NORTHWEST AIRLINES: O'Keiffe Wants Stay Lifted to Pursue Lawsuit
----------------------------------------------------------------
Garrett S. Gregor, Esq., recounts that while on a Northwest
Airlines flight, two female attendants attempted to transfer
Douglas O'Kieffe, a quadriplegic, from his wheelchair to a
passenger seat. In the midst of the transfer, the attendants
dropped Mr. O'Kieffe onto the seat's metal armrest. Due to the
incident, Mr. O'Kieffe suffers severe coxxydynia, controlled only
by narcotic pain medication.
On March 23, 2005, Mr. O'Kieffe filed a lawsuit against Northwest
Airlines, Inc., in the Superior Court of the State of California,
to recover damages. In April 2005, Northwest Airlines requested
to remove the O'Kieffe Case to the U.S. District Court for the
Central District of California on grounds of diversity
jurisdiction. The Lawsuit, which was set to commence on November
15, 2005, was stayed due to the Debtor's Chapter 11 filing.
Mr. O'Kieffe asks the U.S. Bankruptcy Court for the Southern
District of New York to lift the automatic stay to allow the
Lawsuit to continue.
Mr. Gregor tells Judge Gropper that Mr. O'Kieffe is not seeking to
recover damages from Northwest Airlines' assets, and that any
recovery must be limited to applicable insurance coverage. In
light of these limitations, Mr. O'Kieffe will dismiss his claim
for punitive damages against Northwest Airlines.
Parties Settle
After extensive negotiations, Mr. O'Kieffe and the Debtors
stipulate to modify the automatic stay to enable:
(a) the Lawsuit to proceed to final judgment or settlement;
(b) Mr. O'Kieffe to recover any liquidated final judgment or
settlement on his claim from available insurance coverage,
if any. However, any final judgment or settlement will be
reduced by:
* the amount of any applicable deductible or self-insured
retention under the applicable insurance policy; and
* the share of liability under the applicable insurance
policy of any insolvent or non-performing insurer or co-
insurer; and
(c) the Debtors' insurers to pay defense costs related to, and
any settlement of or judgment on the Claim, in accordance
with the terms of the applicable insurance policy, if any,
and subject to all rights, remedies and defenses of any
insurer, which are reserved and preserved.
The Parties agree that the automatic stay will not be modified for
purposes of permitting Mr. O'Kieffe to attempt to recover for
intentional conduct or punitive damages.
Mr. O'Kieffe releases the Debtors and their estates from any and
all claims, except for the one pertaining to the available
insurance coverage.
Mr. O'Kieffe's lift stay request is deemed to be withdrawn without
further Court order.
The stipulation will not be deemed an agreement by the Debtors to
provide assistance to or to cooperate with Mr. O'Kieffe in his
efforts to prosecute his Claim or secure payment under the
available coverage.
Accordingly, Judge Gropper approves the Stipulation in its
entirety.
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. (Northwest Airlines Bankruptcy News, Issue No. 13;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
NORTHWEST AIRLINES: Delivers Settlement Offer to AMFA Members
-------------------------------------------------------------
The Aircraft Mechanics Fraternal Association Negotiating Committee
and Northwest Airlines have discussed the on-going strike and
agreed it was in both parties' best interests to try to resolve
open issues.
Northwest Airlines has provided the AMFA with a full-text
contract, an insurance summary plan description and a strike
settlement agreement.
A copy of the full-text contract is available for free at:
http://ResearchArchives.com/t/s?3d1
A copy of the Summary Plan Description is available for free at:
http://ResearchArchives.com/t/s?3d2
A copy of the Strike Settlement Agreement is available for free
at:
http://ResearchArchives.com/t/s?3d3
The AMFA National Executive Council approved the submission of
Northwest Airlines' offer of settlement for ratification by union
members. The outcome of the vote will be announced December 30,
2005.
The salient terms of the Northwest Agreements are:
(a) AMFA-represented employees will receive 26 weeks of
unemployment benefits, four weeks of lay-off pay, and
payment of accrued vacation;
(b) Employees whose status is "on strike," including those who
have placed their name on the reinstatement list, will be
placed under "off payroll, on layoff" status;
(c) Employees will have a right of recall for the calendar
year 2006 without filing a request, after which, they will
be subject to the terms of the contract regarding renewing
their recall rights; and
(d) Northwest Airlines will not contest payment of
unemployment compensation benefits to employees whose
status is changed from "on strike" to "off payroll, on
layoff."
"AMFA's policy has always been to remain neutral in the
ratification of a contract. In this instance the NWA imposed
contract is so severe and detrimental to our craft we feel
compelled to deviate from our policy and advise you that a
majority of the NEC feels its ratification would be a grave
disservice to our members. This imposed contract is by far the
worst contract in the history of airline labor," AMFA National
Director O.V. Delle-Femine said in a letter sent to AMFA members
at Northwest Airlines.
"We firmly believe that the dedicated AMFA members who chose to
strike rather than live under the terms of the NWA imposed
contract have the right to vote on this offer of settlement."
If the union members vote to accept the conditions, the strike
will end and Northwest Airlines will comply with the terms
offered, said Jeff Mathews, on behalf of the AMFA Negotiating
Committee.
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. (Northwest Airlines Bankruptcy News, Issue No. 13;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
NORTHWEST PARKWAY: S&P Junks Rating on $52.5MM Subordinate Bonds
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its underlying rating
on Northwest Parkway Public Highway Authority, Colorado's
$364 million senior-lien bonds series 2001A-C six notches to 'B-'
from 'BBB-', while also lowering its rating on the authority's
$52.5 million first-tier subordinate bonds series 2001D seven
notches to 'CCC' from 'BB+'. The outlook is stable.
At the same time, Standard & Poor's withdrew its 'BBB-' rating on
the authority's series 2005 senior-lien bonds as a result of the
authority, as of Dec. 16, terminating its efforts to sell the
bonds. The series 2005 bonds would have refunded substantial
portions of the series 2001 bonds and resulted in a debt
restructuring that would have given senior-lien bondholders the
financial flexibility to meet upcoming debt service payments
despite the current underperformance of the road relative to the
original forecasts that the 2001 financing was based on. The
bonds were issued to help finance the construction of the
Northwest Parkway, an 11-mile Denver-area toll road from State
Highway 128 in the west to Interstate 25 in the east.
"Absent dramatic and continued improvement in traffic and
revenues, debt restructuring, or financial assistance, the
senior-lien rating is expected to remain at the current level over
the next few years," said Standard & Poor's credit analyst Laura
Macdonald. "The potential exists for a default on the junior-lien
bonds in the near term, however, and the rating could be lowered
further."
The implications of any new proposed debt restructuring would be
evaluated at the time of proposal.
The speculative-grade ratings reflect concerns regarding the
startup toll road's traffic and revenue performance since opening.
In fiscal 2004, the first year of operation, revenues were 37%
lower than forecast, and for fiscal 2005 revenues are anticipated
to be 44% lower than forecast. This raises concerns regarding the
toll road's ability to meet both senior and junior debt service
payments, which both begin in fiscal 2006. The debt service
reserve fund could be relied upon to meet debt service payments as
early as fiscal 2007 absent significant improvement in traffic and
revenues or a debt restructuring.
NORTHWESTERN CORP: S.D. Judge Denies Move to Halt Director Actions
------------------------------------------------------------------
The Honorable Lawrence L. Piersol of the U.S. District Court for
the District of South Dakota denied a request by a NorthWestern
Corporation shareholders group to immediately halt actions by
company directors to "discourage takeover attempts," The Argus
Leader reports.
The shareholders group, the City of Livonia Employees'
Retirement System, a city-employee pension fund in Michigan
initiated the lawsuit, which seeks class action status, alleges
that Northwestern violated its duty to shareholders by stifling
offers to buy the company. In the suit, Livonia officials claim
that the board acted in its own interest and ignored its
fiduciary duty to shareholders by refusing other possible deals.
As reported in the Dec. 6, 2005, edition of the Class Action
Reporter, the shareholder group says it "seeks to prevent further
harm to NorthWestern and its public shareholders by compelling
[the board] to fulfill their fiduciary responsibility as directors
and prevent [the board] from . . . taking any additional actions
that will [impede] the maximization of shareholders' value."
"The actions they have taken are destroying shareholder value,
not creating it," Rick Atwood, Jr., a lawyer for City of Livonia
Employees' Retirement System told The Argus Leader.
Since July, two buyers publicly made offers to purchase the
utility company, which emerged from Chapter 11 bankruptcy
protections a year ago. The company provides electricity and
natural gas to about 600,000 customers in South Dakota, Montana
and Nebraska.
Lawyers for the shareholders group asked Judge Lawrence Piersol
to issue a temporary order suspending a stockholder rights plan,
or "poison pill," approved December 5 by the board of directors.
If a person or group buys 15 percent or more of the company's
stock, all other owners are awarded additional shares at a
discounted rate. This dilutes the value of each stock and
prevents parties from obtaining more than half of the shares.
The strategy is commonly used to prevent hostile takeovers.
Mr. Atwood told The Argus Leader that the "poison pill" and any
future defensive measures by the company's board could deter
buyers and potentially harm shareholders. However, Judge Piersol
disagreed and pointed out that the present threat to
shareholders was not strong enough to justify a temporary order.
Commenting on the decision, NorthWestern spokeswoman Claudia
Rapkoch told The Argus Leader, "We are pleased with the court's
ruling as it allows us to move forward with our shareholders'
rights plan." She maintains that the company's board initiated
the plan to allow it to evaluate all strategic alternatives
without undue pressure.
Two companies have publicly expressed interested in buying
NorthWestern. Montana Public Power, a nonprofit corporation
comprised of the cities of Bozeman, Great Falls, Helena and
Missoula, offered $32.50 per share in July. Black Hills
Corporation offered last month to pay $33 to $35 per share.
Shares opened at $31.60 per share Friday on the Nasdaq stock
exchange.
Despite denying plaintiffs' motion, Judge Piersol agreed with
them on the importance of expediting the trial schedule. He
said, "This is a major matter, and the court will make itself
available." Lawyers briefly discussed at the recent hearing,
March 7, 2006, as a possible starting date for a trial.
The suit, styled City of Livonia Employees' Retirement
System v. Draper et al., Case No. 4:05-cv-04178-LLP, was filed in
the United States District Court for the District of South
Dakota. The Honorable Lawrence L. Piersol presides over the case.
The Plaintiffs are represented by:
Randall J. Baron, Esq.
Darren J. Robbins, Esq.
David T. Wissbroecker, Esq.
Lerach Coughlin Stoia Geller Rudman & Robbins, LLP
655 W. Broadway, Suite 1900
San Diego, CA 92101
Telephone (619) 231-1058
- and -
Timothy J. Dougherty, Esq.
Dougherty & Dougherty
P.O. Box 1004
Sioux Falls, SD 57101-1004
Telephone (605) 335-8586
The Defendants are represented by:
Filiberto Agusti, Esq.
Andrew Sloniewsky, Esq.
Steptoe and Johnson, LLP
1330 Connecticut Ave, NW
Washington, DC 20036
Telephone (202) 429-6428
- and -
Roberto Antonio Lange, Esq.
Davenport, Evans, Hurwitz & Smith
P.O. Box 1030
Sioux Falls, SD 57101-1030
Telephone (605) 336-2880
NorthWestern Corporation, d/b/a NorthWestern Energy --
http://www.northwesternenergy.com/-- is one of the largest
providers of electricity and natural gas in the Upper Midwest and
Northwest, serving more than 617,000 customers in Montana, South
Dakota and Nebraska. (Class Action Reporter, Dec. 20, 2005)
* * *
As reported in the Troubled Company Reporter on Nov. 30, 2005,
Fitch Ratings has affirmed NorthWestern Corp.'s outstanding senior
secured debt obligations at 'BBB-' and the senior unsecured
revolving credit facility at 'BB+'. The Rating Outlook has been
revised to Evolving from Positive. The rating action follows the
disclosure by NOR on Nov. 23, 2005 that it is evaluating a merger
proposal received from Black Hills Corporation, Inc.
OMNICARE INC: Raising $2.37 Bil. to Repay Loan & Buy Back Notes
---------------------------------------------------------------
Omnicare, Inc., is offering:
* $225 million of its 6-3/4% Senior Subordinated Notes due
2013; and
* $525 million of its 6-7/8% Senior Subordinated Notes due
2015.
Terms of the Notes
Interest is payable on June 15 and December 15 of each year,
beginning on June 15, 2006. The 2013 Notes will mature on
December 15, 2013, and the 2015 Notes will mature on
December 15, 2015.
The Company may redeem all or part of the 2013 Notes on or after
December 15, 2009. The Company may redeem all or part of the 2015
Notes on or after December 15, 2010. Prior to these dates, the
Company may redeem all but not part of the notes by paying a
make-whole premium. Before December 15, 2008, the Company also
may redeem up to 35% of the aggregate principal amount of each of
the 2013 Notes and the 2015 Notes from the proceeds of certain
equity offerings.
The notes will be guaranteed on a senior subordinated basis by
most, but not all, of the Company's current and future domestic
subsidiaries. The notes and the guarantees will be the Company
and its subsidiary guarantors' general unsecured obligations and
are subordinated to the Company and its subsidiaries' senior debt
and will be subordinated to future senior debt that the Company
and its subsidiaries are permitted to incur under their senior
credit facilities and the indenture governing the notes.
The joint book-running managers of the offering are:
* Lehman Brothers Inc.,
* J.P. Morgan Securities Inc., and
* SunTrust Robinson Humphrey
The co-managers of the offering are:
* CIBC World Markets Corp.,
* Wachovia Capital Markets, LLC,
* Merrill Lynch & Co., and
* Credit Suisse First Boston
Common Stock & Convertible Debenture Offering
Concurrently with the notes offering, the Company is offering
12,825,000 shares of its common stock at a price of $59.72 per
share and $850 million aggregate principal amount of its 3.25%
Convertible Senior Debentures due 2035. The closing of this
offering is conditioned on the closing of the concurrent common
stock and convertible debenture offerings.
Use of Proceeds
The Company estimates that the net proceeds from the notes
offering will be approximately $734.4 million, after deducting the
underwriting discount and estimated offering expenses payable by
us. The Company plans to use substantially all of the net
proceeds from the notes offering, as well as the net proceeds of
the concurrent offering of common stock and a portion of the net
proceeds of the concurrent offering of convertible debentures, to
repay its 364-day loan facility, which had an aggregate
outstanding amount of $1.9 billion as of September 30, 2005.
The loan facility was used to finance the NeighborCare acquisition
and the repayment of related debt, as well as the acquisition of
excelleRx, Inc. and RxCrossroads, L.L.C.
Sources of Funds:
6-3/4% senior subordinated notes, due 2013 $ 225,000,000
6-7/8% senior subordinated notes, due 2015 525,000,000
3.25% senior convertible debentures, due 2035 850,000,000
Common stock 765,909,000
-------------
Total Sources $2,365,909,000
Use of Funds:
Repay 364-day loan facility, including accrued
interest and premium $1,904,094,000
Repurchase 8.125% senior subordinated notes
due 2011, including accrued interest 376,270,000
Estimated offering expenses and professional fees 84,163,000
Addition to cash 1,382,000
-------------
Total Uses $2,365,909,000
A full-text copy of the Prospectus is available for free at
http://ResearchArchives.com/t/s?3d7
Omnicare, Inc. (NYSE:OCR), a Fortune 500 company based in
Covington, Kentucky, is a leading provider of pharmaceutical care
for the elderly. Omnicare serves residents in long-term care
facilities comprising approximately 1,090,000 beds in 47 states in
the United States and in Canada, making it the largest U.S.
provider of professional pharmacy, related consulting and data
management services for skilled nursing, assisted living and other
institutional healthcare providers. Omnicare also provides
clinical research services for the pharmaceutical and
biotechnology industries in 30 countries worldwide.
* * *
As reported in the Troubled Company Reporter on Dec. 13, 2005,
Standard & Poor's Ratings Services affirmed its ratings on
Omnicare Inc., including the 'BBB-' corporate credit rating. All
ratings were removed from CreditWatch, where they were placed with
negative implications May 24, 2004, when Omnicare first initiated
its ultimately successful effort to acquire competitor
NeighborCare Inc. for $1.9 billion. S&P said the rating outlook
is stable.
PACIFIC MAGTRON: Disclosure Statement Hearing Set on December 23
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada will convene
a hearing at 9:30 a.m., on Dec. 23, 2005, to consider the adequacy
of the Disclosure Statement explaining the Second Amended Plan of
Liquidation filed by Pacific Magtron Inc., (PMI) and the Second
Amended Plan of Liquidation filed Pacific Magtron (PMIGA), Inc.
The two Plans treat the assets and debts of each Debtor
separately. PMI and PMIGA will be liquidated separately and their
assets distributed to their respective creditors.
The PMI Creditor Trust and PMIGA Creditor Trust will be
established to administer each debtor's liquidated assets.
Timothy S. Cory will serve as Trustee for both Creditor Trusts.
Summary of Second Amended Plan of PMI
On the effective date of PMI's Plan, the Debtor will disburse the
funds in the formerly blocked account at Wells Fargo Bank to Micro
Technology Concepts, Inc., and make full payments to its
administrative, priority and administrative convenience class
creditors.
The unsecured creditors of PMI, including the unsecured portion of
the claim of Micro Technology, estimated at $89,000, will be paid
with proceeds from the liquidation of PMI's assets. On the
effective date, PMI will make a partial distribution of not less
than 75% of its cash assets to holders of undisputed, allowed
unsecured creditors.
All of PMI's cash, not subject to security interests, will be
delivered to the PMI Creditor Trust. The Trustee will liquidate
the remaining assets and distribute them pro rata to the unsecured
creditors of PMI.
Summary of Second Amended Plan of PMIGA
On the effective date of PMIGA's Plan, it will make a full payment
to its administrative creditors and disburse not less than 75% of
its available funds to its unsecured, non-priority creditors, and
pay the balance of its funds to the Trustee of the PMIGA Creditor
Trust.
The unsecured creditors of PMIGA will be paid from the funds held
by the Debtor and from its accounts receivable, totaling
approximately $170,000. On the effective date, PMIGA will make a
partial distribution of not less than 75% of its cash assets to
holders of undisputed, allowed unsecured creditors.
On the effective date, the balance of PMIGA's assets, including
but not limited to cash and accounts receivable, will be delivered
to the PMIGA Creditor Trust. The Trustee of the PMIGA Trust will
be responsible for collection of accounts receivable owed to
PMIGA. The net assets of PMIGA, after the costs of administration
are deducted, will be distributed pro rata among the creditors of
PMIGA.
A full-text copy of the Disclosure Statement is available for a
fee at:
http://www.researcharchives.com/bin/download?id=051220022934
Headquartered in Milpitas, California, Pacific Magtron
International Corp. -- http://www.pacificmagtron.com/--
distributes some 1,800 computer hardware, software, peripheral,
and accessory items that it buys directly from 30 manufacturers
like Creative Labs, Logitech, and Yamaha. The Company, along with
its subsidiaries, filed for chapter 11 protection on May 11, 2005
(Bankr. D. Nev. Case No. 05-14326). As of Dec. 31, 2004, the
Company reported $11,740,700 in total assets and $11,105,200 in
total debts.
PATHMARK STORES: Weak Credit Metrics Prompt S&P's B- Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Pathmark
Stores Inc. to 'B-' from 'B'. The rating outlook is negative.
"The downgrade reflects Pathmark's weakening credit metrics,
limited cash flow generation, and our view that it will be very
challenging for the company to significantly improve its market
share and profitability levels given the competitive supermarket
environment in which it operates," said Standard & Poor's credit
analyst Stella Kapur.
Same-store sales in the first nine months of 2005 declined 0.8%,
and total sales were flat at $3 billion. However, profitability
declined significantly. Nine-month EBITDA was around $74 million,
or 27% lower than in the prior year. A decline in profitability
occurred in the third quarter, when a remerchandising and store
initiative was implemented in all of the company's 142 stores. As
a result of the remerchandising program, perishable shrink
increased $4.9 million.
Pathmark also incurred charges associated with a voluntary union
labor buyout in the third quarter. While some of the charges,
such as the remerchandising costs, could be considered one-time,
S&P views them as costs that the company should have incurred as
part of its ongoing operations. Trailing 12-month lease-adjusted
operating margins declined to 4.3% from 5% last year. The
company's operating margins are below many of its industry peers'.
Credit metrics deteriorated significantly in the third quarter as
a result of the decline in margins. Operating lease-adjusted debt
to EBITDA was 6.4x at Oct. 29, 2005, and EBITDA interest coverage
was 1.6x. Total debt is $611 million. Given the competitive
environment, Standard & Poor's anticipates that it will be very
challenging for Pathmark to increase its market share and
profitability levels, despite its remerchandising initiatives.
Hence, S&P expects that credit metrics will continue to be very
weak for current ratings over the intermediate term. Furthermore,
given increased capital expenditure levels, free operating cash
flow was negative $34 million in the first nine months of 2005.
Capital expenditures are anticipated to remain elevated given
store remodeling and investment needs.
PENN TRAFFIC: Has Until Mar. 31 to Finalize Financial Reports
-------------------------------------------------------------
The Penn Traffic Company reported that in light of the previously
announced governmental investigations seeking information relating
to the Company's promotional and allowance practices and policies,
Penn Traffic would be further delaying the finalization and
release of its audited financial statements for its 2003, 2004 and
2005 fiscal years.
At Penn Traffic's request, the lenders under Penn Traffic's
$164 million revolving credit facilities have agreed to extend the
December 31, 2005, deadline for delivery of its audited financial
statements to March 31, 2006, enabling Penn Traffic to continue to
access fully its working capital facility.
At November 25, 2005, Penn Traffic had undrawn availability of
approximately $56 million and a 30 day average undrawn
availability of approximately $62 million under this revolving
credit facility.
"We regret that the audit of our financial statements will not be
completed prior to the December deadline," said Robert Chapman,
Penn Traffic's President and Chief Executive Officer, "but we
continue to be extremely gratified that our lenders have been
understanding in working with us. We look forward to getting past
this disruption so that we can achieve the goals we established
for our reorganized Company and its more than 8,500 employees."
Headquartered in Rye, New York, The Penn Traffic Company operates
109 supermarkets in Pennsylvania, upstate New York, Vermont and
New Hampshire under the BiLo, P&C and Quality trade names. Penn
Traffic also operates a wholesale food distribution business
serving 80 licensed franchises and 39 independent operators.
The Company filed for chapter 11 protection on May 30, 2003
(Bankr. S.D.N.Y. Case No. 03-22945). Kelley Ann Cornish, Esq., at
Paul Weiss Rifkind Wharton & Garrison, represents the Debtors in
their restructuring efforts. When the grocer filed for protection
from their creditors, they listed $736,532,614 in total assets and
$736,532,610 in total debts. The Court confirmed the Debtor's
First Amended Plan of Reorganization on March 17, 2005. The Plan
took effect on Apr. 13, 2005.
PEP BOYS: Wachovia Arranging $200 Million Senior Secured Facility
-----------------------------------------------------------------
The Pep Boys - Manny, Moe & Jack (NYSE:PBY) reported that Wachovia
Bank, National Association and Wachovia Capital Markets, LLC have
agreed to underwrite and syndicate a $200 million senior secured
term loan facility, expected to be completed in January or
February 2006. The proceeds from the facility will be used to
repay $43 million and $100 million in outstanding medium term
notes that mature in 2006 and reduce borrowings under the
company's revolving credit facility.
By retiring the medium term notes (through defeasance or
repayment), the company will eliminate certain indenture
restrictions on its ability to sell, encumber or otherwise utilize
its real estate portfolio, a portion of which will be used to
secure the new Wachovia facility.
The closing of the Wachovia facility is subject to the execution
of definitive agreements, the absence of any material adverse
change in the company's business or the financial markets and
certain other customary closing conditions.
"Pre-financing our 2006 maturities will ensure that the Company
can execute on our strategy to optimize our retail and service
operations and, in turn, improve long-term shareholder value," CFO
Harry Yanowitz said. "In addition, the new facility's prepayment
and collateral substitution rights will allow the Company to
continue the process of improving capital allocation, ensuring
that each of its properties can be developed to its highest and
best use."
Pep Boys -- http://www.pepboys.com/-- has 593 stores and more
than 6,000 service bays in 36 states and Puerto Rico. Along with
its vehicle repair and maintenance capabilities, the Company also
serves the commercial auto parts delivery market and is one of the
leading sellers of replacement tires in the United States.
PEP BOYS: High Leverage Spurs S&P's Junk Subordinated Note Rating
* * *
As reported in the Troubled Company Reporter on Dec. 16, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Pep Boys, Manny, Moe & Jack to 'B-' from 'B+' and
removed the rating from CreditWatch, where it was placed on
Nov. 11, 2005.
At the same time, the bank loan rating was lowered to 'B', the
senior unsecured rating was lowered to 'B-', and the subordinated
note rating was lowered to 'CCC'. These actions reflect the
company's very highly leveraged capital structure due to poor
earnings performance, its significant debt maturities due in 2006
and 2007, and lack of operating cash flow generation. The outlook
is negative.
PGCC INC: Ontario Court Authorizes KPMG to Sell Paris Grand
-----------------------------------------------------------
The Ontario Superior Court of Justice authorized KPMG Inc., to
solicit offers to purchase Paris Grand Golf Club & Inns.
The Paris Grand Golf Club & Inns is a 170-acre property in Paris,
Ontario, that includes a recently re-designed 18 hole championship
golf course with clubhouse including licensed dining and banquet
facilities, two luxurious guest houses with a total of 10 bedrooms
and two single family dwellings.
Offers for the Paris Grand Property must be received no later than
12:00 noon on Jan. 31, 2006 and delivered to:
KPMG Inc.
Court-appointed Receiver and Manager of
PGCC Inc., 1302253 Ontario Ltd. and 910864 Ontario Inc.
P.O. Box 31
Commerce Court West Postal Station
Toronto, Ontario M5L 1B2
PHARMACEUTICAL FORMULATIONS: Taps Grant Thornton as Accountants
---------------------------------------------------------------
Pharmaceutical Formulations, Inc., nka 14605 Incorporated, asks
the U.S. Bankruptcy Court for the District of Delaware for
authority to employ Thornton LLP as its accountants, nunc pro tunc
to Sept. 23, 2005.
The Debtor has selected Grant Thornton as its accountant because
of the firm's familiarity with Pharmaceutical's business as a
result of the firm's prepetition work for the Debtor.
Grant Thornton will perform accounting of the Debtor's receivable,
inventory, cash, accounts payable and other account records, and
provide the Debtor with a report regarding its findings.
The current billing rates of Grant Thornton's professionals are:
Designation Rate
----------- ----
Partners $450
Senior Managers $395
Managers $335
Senior Associates $280
Associates $160
Admin./Secretarial $95
To the best of the Debtor's knowledge, Grant Thornton is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Headquartered in North Brunswick, New Jersey, Allserve Systems
Corp. is an outsourcing company for the IT industry. The Debtor
filed for chapter 11 protection on November 18, 2005 (Bankr. D.
N.J. Case No. 05-60401). Barry W. Frost, Esq., at Teich Groh
represents the Debtor in its restructuring efforts. When the
Debtor filed for protection from its creditors, it estimated
assets between 10 million to $50 million and debts between $50
million to $100 million.
PHILLIP GEERTSON: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtors: Phillip Geertson and Marilyn Geertson
dba Geertson Seed Company
1665 Burroughs Road
Adrian, Oregon 97901
Bankruptcy Case No.: 05-05759
Type of Business: Geertson Seed Farms grow, process
and sell alfalfa seeds. See
http://www.geertsonseedfarms.com/
The Debtors are affiliates of Geertson, LLC,
which filed for chapter 11 protection on
June 15, 2005 (Bankr. D. Id. Case No.
05-02343)(Meyers, J.).
Chapter 11 Petition Date: December 19, 2005
Court: District of Idaho (Boise)
Judge: Jim D. Pappas
Debtors' Counsel: Frances R. Stern, Esq.
Frances R. Stern Law Office
300 West Myrtle, Suite 200
Boise, Idaho 83702
Tel: (208) 344-8900
Fax: (208) 344-7100
Estimated Assets: Less than $50,000
Estimated Debts: $1 Million to $10 Million
Debtors' 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Sierra Pacific Utilities $59,156
P.O. Box 866 Accounts ending
Winnemucca, NV 89446 with
#411393; #391645;
#457743; #457776;
#412144; #457735;
#457768; #457750;
#457792
Legacy Hybrids, Inc. Corn $32,451
11384 Laberdee Road
Deerfield, MI 49238
Geertson, Patrick Custom harvest $27,000
Homedale, ID 83628
Advanta Credit card $14,717
P.O. Box 30715
Salt Lake City, UT 84130-0715
Ideal Printers, Inc. $12,327
645 Olive Street
Saint Paul, MN 55101
Wilbur-Ellis Company Chemicals $11,018
4272 Paysphere Circle
Chicago, IL 60674
Matteson's Owhyee Fuel $10,284
Motor Sales, Inc.
3 South Main Street
Homedale, ID 83628
American Drilling & Pump Service Repairs $10,050
3040 Callhan Street
Winnemucca, NV 89445
Western Farm Service Chemicals $7,484
Department #87
P.O. Box 34935
Seattle, WA 98124
Campbell Tractor Co. Repairs $6,367
2014 Franklin Boulevard
Nampa, ID 83687
Macy's Credit card $5,736
P.O. Box 745012
Cincinnati, OH 45274-5012
McClintick Farms Seed cleaning $3,500
P.O. Box 129
Orovada, NV 89425
Thurston Genetics Corn $3,279
P.O. Box 117
Olivia, MN 56277
Great American Insurance Group Insurance $3,261
P.O. Box 691178
Cincinnati, OH 45269-1178
Chase Credit card $3,127
P.O. Box 9001074
Louisville, KY 40290-1074
Idaho State Seed Lab Seed testing $2,611
2240 Kellog Lane
Boise, ID 83712
Nitragin Chemicals $2,478
13100 West Libson Road, #600
Brookfield, WI 53005
Shell Products, Inc. Fuel $1,783
P.O. Box 990
Winnemucca, NV 89446
Treasure Valley Seed Co. Seed $1,330
P.O. Box 2184
Homedale, ID 83628
Bayer CropScience Chemicals $1,285
P.O. Box 12014
Research Triangle Park, NC 27709
PHOTOCIRCUITS CORP: Wants to Obtain $7.33 DIP Loan from Stairway
----------------------------------------------------------------
Photocircuits Corporation asks the U.S. Bankruptcy Court for the
Eastern District of New York for permission to incur $7.33 million
postpetition debt from Stairway Capital Management, L.P. on an
interim basis.
The Debtor says that the funds are necessary to meet all of its
working capital needs, and to preserve the going concern sale
value of its assets.
In addition, the Debtor's suppliers, vendors and other creditors
are looking to the immediate approval of the DIP loan for
assurance that they will be paid on a continuous and timely basis.
Stairway is entitled to superiority administrative expense status
and secured by superpriority status over senior liens on and
security interest in all of the Debtor's assets.
The loan will mature on January 31, 2006.
Headquartered in Glen Cove, New York, Photocircuits Corporation --
http://www.photocircuits.com/-- was the first independent printed
circuit board fabricator in the world. Its worldwide reach
comprises facilities in Peachtree City, Georgia; Monterrey,
Mexico; Heredia, Costa Rica; and Batangas, Philippines. The
Company filed for chapter 11 protection on Oct. 14, 2005 (Bankr.
E.D.N.Y. Case No. 05-89022). Gerard R Luckman, Esq., at Silverman
Perlstein & Acampora LLP, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it estimated more than $100 million in assets and
debts.
PIER 1: Weak Operating Results Prompt S&P's Negative Watch
----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB' corporate
credit rating on home furnishings retailer Pier 1 Imports Inc. on
CreditWatch with negative implications.
"The rating action reflects Pier 1's weaker-than-expected
operating results for the third quarter ended Nov. 26, 2005, and
lowered sales expectations for December 2005 due to heavy
promotions and unpredictable sales trends," said Standard & Poor's
credit analyst Ana Lai. "The CreditWatch listing also reflects
our concern with Pier 1's ability to turn around sales and
profitability through its merchandising and marketing initiatives,
given increased competitive pressure."
Because of much lower than anticipated earnings, credit protection
measures deteriorated significantly, with total debt to EBITDA
increasing to about 7.0x for the 12 months ended Nov. 26, 2005,
from about 4.4x for the fiscal year ended Feb. 26, 2005.
POLAROID CORP: Administrator's Final Report Due by January 16
-------------------------------------------------------------
The U.S. Bankruptcy Court District of Delaware gave Wind Down
Associates LLC, the Plan Administrator appointed under the
confirmed Third Amended Joint Plan of Reorganization of Primary
PDC, Inc. (f/k/a Polaroid Corporation) and its debtor affiliates,
a further extension, until the earlier of Jan. 16, 2006 or 15 days
before the hearing on any motion to close the Debtor's case, to
file a Final Report and Accounting pursuant to Rule 5009-1(c) of
the Local Rules of Bankruptcy Practice and Procedure.
The Court also further delayed until Feb. 15, 2006, the entry of a
final decree closing the Debtors' chapter 11 cases pursuant to
Rule 5009 of the Bankruptcy Court.
The Court confirmed the Debtors and the Official Committee of
Unsecured Creditors' Joint Plan on Nov. 18, 2003, and the Plan
took effect on Dec. 17, 2003.
The Plan Administrator seeks to further extend the final deadlines
because it needs the jurisdiction of the Bankruptcy Court while
the claims administration process is ongoing.
Headquartered in Cambridge, Massachusetts, Primary PDC, Inc.,
(f/k/a Polaroid Corporation), -- http://www.primarypdc.com-- is
responsible for settling claims and for administering business
matters related to the former Polaroid Corporation. Substantially
all of the assets of Polaroid Corporation were sold to OEP Imaging
Operating Corporation on July 31, 2002. The Company and its
debtor-affiliates filed for chapter 11 protection on Oct. 12, 2001
(Bankr. D. Del. Case No. 01-10864). The Court confirmed the
Debtors' chapter 11 Plan on Nov. 18, 2003, and the Plan took
effect on Dec. 17, 2003. Wind Down Associates LLC is the Plan
Administrator under the confirmed Plan. Joseph A. Malfitano,
Esq., at Young, Conaway, Stargatt & Taylor and Phil Dublin, Esq.,
at Akin, Gump, Strauss, Hauer & Feld, L.L.P., represents the Plan
Administrator.
REFCO INC: Appoints Harrison J. Goldin as Chief Executive Officer
-----------------------------------------------------------------
Refco Inc. (OTC: RFXCQ) appointed Harrison J. Goldin as Chief
Executive Officer of the company. Mr. Goldin succeeds Robert
Dangremond, who served as interim Chief Executive Officer
following the resignation of William Sexton in November.
"As Refco begins to wind up its affairs, Mr. Goldin brings
qualities of independence, integrity and experience in such
matters, as well as the respect of all parties, which the Company
believes will facilitate an efficient process," said James Craig,
a spokesman for the company.
Mr. Goldin's appointment was endorsed by the Official Committee of
Creditors in Refco's bankruptcy case.
Mr. Goldin is senior managing director of Goldin Associates, LLC,
which provides financial advisory, interim management, forensic
investigation, and strategic and risk management consulting
services. Mr. Goldin and his firm have often acted as interim
manager, examiner, independent investigator and trustee. He also
is founding chair and chairman emeritus of the Council of
Institutional Investors.
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. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Refco
reported $16.5 billion in assets and $16.8 billion in debts to the
Bankruptcy Court on the first day of its chapter 11 cases.
RESI FINANCE: S&P Assigns Low-B Ratings to $58.9MM Class B Certs.
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its ratings to RESI
Finance Limited Partnership 2005-D/RESI Finance DE Corp. 2005-D's
$185.011 million real estate synthetic investment
securities.
The ratings are based on:
* credit enhancement levels,
* the transaction's shifting interest structure,
* a legal structure designed to minimize potential losses to
security holders caused by the insolvency of the issuer,
and
* the AA/Stable/A-1+ credit rating assigned to Bank of
America N.A., based on its obligations pursuant to the
forward delivery agreement and the credit default
swap agreement.
Ratings Assigned
RESI Finance Limited Partnership 2005-D/RESI
Finance DE Corp. 2005-D
Class Rating Amount
----- ------ ------
B3 A $60,551,000
B4 A- $23,547,000
B5 BBB $31,957,000
B6 BBB- $10,091,000
B7 BB $20,183,000
B8 BB- $8,409,000
B9 B+ $13,455,000
B10 B $8,409,000
B11 B- $8,409,000
RICHARD DURAND: Case Summary & 2 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Richard Dillon Durand
145 Lupton Lane
Cleveland, Tennessee 37311
Bankruptcy Case No.: 05-18158
Chapter 11 Petition Date: December 16, 2005
Court: Eastern District of Tennessee (Chattanooga)
Debtor's Counsel: Richard L. Banks, Esq.
Richard Banks & Associates, P.C.
620 Church Street
P.O. Box 1515
Cleveland, Tennessee 37364-1515
Tel: (423) 479-4188
Estimated Assets: $10 Million to $50 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 2 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Barry White, Esq. $1
1100 Reidgeway Loop Road, Suite 400
Memphis, TN 38120
Bruce Bailey, Esq. $1
Chambliss Bahner & Stophel
Two Union Square
Chattanooga, TN 37402
RUFUS INC: Files Plan and Disclosure Statement in Delaware
----------------------------------------------------------
Rufus, Inc., unveiled to the U.S. Bankruptcy Court for the
District of Delaware its Plan of Reorganization and accompanying
Disclosure Statement.
The Plan provides for the merger of substantially all of the
Debtor's assets with Maxie Biggz, LLC. The business operations,
after plan confirmation, will be solely conducted by Maxie. Once
the merger is consummated, Maxie will assume some of the Debtor's
liabilities.
Under the Plan, these claims, aggregating $18,579,166, will be
paid in full:
-- administrative claims;
-- priority tax claims;
-- non-priority claims;
-- Penn claim; and
-- other secured claims;
MVP II/MVP DIP lender claims will be contributed to capital in the
Debtor prior to the merger.
General unsecured creditors will receive their pro rata share from
a $150,000 pool and other forms of distribution. Warranty claims
will share in a distribution of up to $25,000. These two creditor
classes assert claims totaling $4,365,852.
Equity holders won't receive any distribution under the Plan.
An Administrator will be appointed to administer the Plan and make
distributions to creditors.
Headquartered in Meriden, Connecticut, Rufus, Inc., sells dogs,
dog food, supplies and accessories. The Debtor also operates a
chain of six retail stores in the Northeastern United States. The
Company filed for chapter 11 protection on Aug. 10, 2005 (Bankr.
D. Del. Case No. 05-12218). Edward J. Kosmowski, Esq., and Ian S.
Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP,
represent the Debtor in its bankruptcy proceeding. When the
Debtor filed for protection from its creditors, it listed $1.8
million in total assets and $12.7 million in total debts.
SALS 2004-A: Credit Risks Prompt S&P's Negative Watch
-----------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on 35
classes from 18 U.S. synthetic CDO transactions on CreditWatch
with negative implications. When combining pari passu tranches,
the 35 ratings represent 25 credit classes.
The CreditWatch placements are due to an update of Standard &
Poor's credit opinion regarding the risks associated with the
credit behavior of non-investment-grade entities. In addition,
S&P's assessment of how that behavior is correlated also has been
updated. The updated assumptions have been incorporated into
Standard & Poor's CDO Evaluator model, the latest version of which
was released for global synthetic CDO transactions.
Standard & Poor's expects to resolve the CreditWatch placements on
the affected ratings within 90 days and either lower or affirm the
rating assigned to each tranche. In the interim, Standard &
Poor's will work with arrangers to gather additional information
on the affected transactions, especially those that may be
restructured during this period. Absent any changes in the
transactions during the CreditWatch period, the most severe rating
action taken among the affected tranches would be a three-notch
downgrade. Barring any changes in the affected tranches,
approximately half of the potential actions would be one-notch
downgrades, and the remaining actions would be split evenly
between two- and three-notch downgrades.
The 35 tranches with ratings placed on CreditWatch negative
represent approximately 4% of Standard & Poor's total publicly
rated U.S. synthetic CDO tranches.
Ratings Placed On Creditwatch Negative
Archstone I PLC
Rating
Class To From
----- -- ----
2005-C1 A/Watch Neg A
2005-C2 A/Watch Neg A
Barton Springs CDO SPC Series 2005-1 SEG
Rating
Class To From
----- -- ----
D-1 BB+/Watch Neg BB+
D-2 BB+/Watch Neg BB+
Blue Point CDO SPC Series 2005-1
Rating
Class To From
----- -- ----
C-1 A/Watch Neg A
C-2 A/Watch Neg A
D-1 BBB/Watch Neg BBB
D-2 BBB/Watch Neg BBB
Blue Point CDO SPC Series 2005-2
Rating
Class To From
----- -- ----
C A/Watch Neg A
D BBB/Watch Neg BBB
Morgan Stanley ACES SPC Series 2005-14
Rating
Class To From
----- -- ----
II secured AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-15
Rating
Class To From
----- -- ----
II secured AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-18
Rating
Class To From
----- -- ----
SFRN AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-22
Rating
Class To From
----- -- ----
Notes AAA/Watch Neg AAA
SALS 2004-A
Rating
Class To From
----- -- ----
F1 BB/Watch Neg BB
F2 BB/Watch Neg BB
Salt Creek High Yield CSO 2005-1 Ltd.
Rating
Class To From
----- -- ----
A-4$L AA-/Watch Neg AA-
A-6 A/Watch Neg A
A-6EL-1 A/Watch Neg A
A-6EL A/Watch Neg A
A-7 A-/Watch Neg A-
B-2 BBB/Watch Neg BBB
B-3$L BBB-/Watch Neg BBB-
B-5 BB/Watch Neg BB
B-6$L BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-5
Rating
Class To From
----- -- ----
E BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-7
Rating
Class To From
----- -- ----
Combo notes BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-12
Rating
Class To From
----- -- ----
E BB-/Watch Neg BB-
Strata 2004-8 Ltd.
Rating
Class To From
----- -- ----
Floating rate notes BBB/Watch Neg BBB
Strata 2005-19 Ltd. Floating Rate Notes
Rating
Class To From
----- -- ----
FRN BBB-/Watch Neg BBB-
Sunset Park CDO Ltd. SPC Series 2004-4
Rating
Class To From
----- -- ----
B A-/Watch Neg A-
Sunset Park CDO Ltd. SPC Series 2005-5
Rating
Class To From
----- -- ----
B AA/Watch Neg AA
Sunset Park CDO-M Ltd. SPC Series 2005-3 SEG
Rating
Class To From
----- -- ----
D-1 AA-/Watch Neg AA-
D-2 AA-/Watch Neg AA-
E A-/Watch Neg A-
SALT CREEK: Credit Risks Prompt S&P's Negative Watch
----------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on 35
classes from 18 U.S. synthetic CDO transactions on CreditWatch
with negative implications. When combining pari passu tranches,
the 35 ratings represent 25 credit classes.
The CreditWatch placements are due to an update of Standard &
Poor's credit opinion regarding the risks associated with the
credit behavior of non-investment-grade entities. In addition,
S&P's assessment of how that behavior is correlated also has been
updated. The updated assumptions have been incorporated into
Standard & Poor's CDO Evaluator model, the latest version of which
was released for global synthetic CDO transactions.
Standard & Poor's expects to resolve the CreditWatch placements on
the affected ratings within 90 days and either lower or affirm the
rating assigned to each tranche. In the interim, Standard &
Poor's will work with arrangers to gather additional information
on the affected transactions, especially those that may be
restructured during this period. Absent any changes in the
transactions during the CreditWatch period, the most severe rating
action taken among the affected tranches would be a three-notch
downgrade. Barring any changes in the affected tranches,
approximately half of the potential actions would be one-notch
downgrades, and the remaining actions would be split evenly
between two- and three-notch downgrades.
The 35 tranches with ratings placed on CreditWatch negative
represent approximately 4% of Standard & Poor's total publicly
rated U.S. synthetic CDO tranches.
Ratings Placed On Creditwatch Negative
Archstone I PLC
Rating
Class To From
----- -- ----
2005-C1 A/Watch Neg A
2005-C2 A/Watch Neg A
Barton Springs CDO SPC Series 2005-1 SEG
Rating
Class To From
----- -- ----
D-1 BB+/Watch Neg BB+
D-2 BB+/Watch Neg BB+
Blue Point CDO SPC Series 2005-1
Rating
Class To From
----- -- ----
C-1 A/Watch Neg A
C-2 A/Watch Neg A
D-1 BBB/Watch Neg BBB
D-2 BBB/Watch Neg BBB
Blue Point CDO SPC Series 2005-2
Rating
Class To From
----- -- ----
C A/Watch Neg A
D BBB/Watch Neg BBB
Morgan Stanley ACES SPC Series 2005-14
Rating
Class To From
----- -- ----
II secured AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-15
Rating
Class To From
----- -- ----
II secured AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-18
Rating
Class To From
----- -- ----
SFRN AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-22
Rating
Class To From
----- -- ----
Notes AAA/Watch Neg AAA
SALS 2004-A
Rating
Class To From
----- -- ----
F1 BB/Watch Neg BB
F2 BB/Watch Neg BB
Salt Creek High Yield CSO 2005-1 Ltd.
Rating
Class To From
----- -- ----
A-4$L AA-/Watch Neg AA-
A-6 A/Watch Neg A
A-6EL-1 A/Watch Neg A
A-6EL A/Watch Neg A
A-7 A-/Watch Neg A-
B-2 BBB/Watch Neg BBB
B-3$L BBB-/Watch Neg BBB-
B-5 BB/Watch Neg BB
B-6$L BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-5
Rating
Class To From
----- -- ----
E BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-7
Rating
Class To From
----- -- ----
Combo notes BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-12
Rating
Class To From
----- -- ----
E BB-/Watch Neg BB-
Strata 2004-8 Ltd.
Rating
Class To From
----- -- ----
Floating rate notes BBB/Watch Neg BBB
Strata 2005-19 Ltd. Floating Rate Notes
Rating
Class To From
----- -- ----
FRN BBB-/Watch Neg BBB-
Sunset Park CDO Ltd. SPC Series 2004-4
Rating
Class To From
----- -- ----
B A-/Watch Neg A-
Sunset Park CDO Ltd. SPC Series 2005-5
Rating
Class To From
----- -- ----
B AA/Watch Neg AA
Sunset Park CDO-M Ltd. SPC Series 2005-3 SEG
Rating
Class To From
----- -- ----
D-1 AA-/Watch Neg AA-
D-2 AA-/Watch Neg AA-
E A-/Watch Neg A-
SANITARY & IMPROVEMENT: U.S. Trustee Appoints 4-Member Committee
----------------------------------------------------------------
The United States Trustee for Region 13 appointed five creditors
to serve on an Official Committee of Unsecured Creditors in
Sanitary & Improvement District 425 of Douglas County, Nebraska's
chapter 9 case:
1. Vantage Investment Advisors LLC
Attn: John Woolway
8500 Shawnee Mission Parkway, Suite 220
Merriam, Kansas 66202
Tel: (913) 895-0456
Fax: (913) 895-0356
2. Allan Lozier
Attn: Jerry G. Banks
6336 Pershing Drive
Omaha, Nebraska 68110
Tel: (402) 457-8589
Fax: (402) 457-8187
3. William R. Hengstler
P.O. Box 105
Creighton, Nebraska 68729
Tel: (402) 358-3730
Fax: (402) 358-3730
Winter Address:
William R. Hengstler
11026 W. Waikiki Drive
Sun City, Arizona 95351-1500
Tel: (623) 974-6665
Fax: (623) 974-6665
4. First National Bank and Trust Co.
Attn: Del L. Sommerhalder
1701 Stone Street
Falls City, Nebraska 68355
Tel: (469) 547-9062
Fax: (214) 615-7034
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense. They may investigate the Debtors' business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent. Those
committees will also attempt to negotiate the terms of a
consensual chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtors is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.
Sanitary & Improvement District 425 of Douglas County, Nebraska
filed for chap. 9 protection on Oct. 26, 2005 (Bankr. D. Nebr.
Case No. 05-85871). Mark James LaPuzza, Esq., at Pansing Hogan
Ernst & Bachman, LLP, represents the Debtor in its restructuring
efforts. When the Debtor filed for protection from its creditors,
it estimated assets between $500,000 to $1 million and estimated
debts between $10 million to $50 million.
SAV-ON LTD: Files Schedules of Assets and Liabilities
-----------------------------------------------------
Sav-On, Ltd., delivered its Schedules of Assets and Liabilities to
the U.S. Bankruptcy Court for the Northern District of Texas,
disclosing:
Name of Schedule Assets Liabilities
---------------- ------ -----------
A. Real Property
B. Personal Property $7,844,155
C. Property Claimed
as Exempt
D. Creditors Holding $6,893,913
Secured Claims
E. Creditors Holding $265,061
Unsecured Priority Claims
F. Creditors Holding $7,812,412
Unsecured Nonpriority
Claims
---------- -----------
Total $7,844,155 $14,971,386
Headquartered in Dallas, Texas, Sav-On, Ltd., operates 37 retail
and commercial stores that sell a wide range of standard office
supplies and products predominantly in small towns located in
Texas, New Mexico, Colorado, Oklahoma, Louisiana, Tennessee and
Alabama. The Debtor filed for chapter 11 protection on Nov. 19,
2005 (Bankr. N.D. Tex. Case No. 05-86875). Donald R. Rector,
Esq., at Glast Phillips & Murray, PC, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed total assets of $7,844,155 and total
debts of $14,971,386.
SAV-ON LTD: U.S. Trustee Appoints 5-Member Creditors Committee
--------------------------------------------------------------
The United States Trustee for Region 6 appointed five creditors to
serve on an Official Committee of Unsecured Creditors in Sav-On,
Ltd.'s chapter 11 case:
1. Don Heighton
Rediform, Inc.
555 Airline Drive
Coppell, Texas 75019
Tel: (972) 304-2303
2. Dave Paton
Samsill
5740 Hartman Road
Fort Worth, Texas 76119
Tel: (817) 536-1906x212
3. Tiffany Geiswite
Central Freight Lines, Inc.
4. Di McJunkin
Paper Systems, Inc.
Springboro, Ohio
Tel: (937) 743-5222
5. Valerie Skrivanek
Williamhouse
Dallas, Texas
Tel: (972) 733-5458
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense. They may investigate the Debtors' business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent. Those
committees will also attempt to negotiate the terms of a
consensual chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtors is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.
Headquartered in Dallas, Texas, Sav-On, Ltd., operates 37 retail
and commercial stores that sell a wide range of standard office
supplies and products predominantly in small towns located in
Texas, New Mexico, Colorado, Oklahoma, Louisiana, Tennessee and
Alabama. The Debtor filed for chapter 11 protection on Nov. 19,
2005 (Bankr. N.D. Tex. Case No. 05-86875). Donald R. Rector,
Esq., at Glast Phillips & Murray, PC, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed total assets of $7,844,155 and total
debts of $14,971,386.
SAV-ON LTD: Section 341(a) Meeting Slated for December 29
---------------------------------------------------------
The U.S. Trustee for Region 6 will convene a meeting of Sav-On,
Ltd.'s creditors at 10:00 a.m., on Dec. 29, 2005, at the Office of
the U.S. Trustee, 1100 Commerce Street, Room 976, in Dallas,
Texas. This is the first meeting of creditors required under
Section 341(a) of the U.S. Bankruptcy Code 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 Dallas, Texas, Sav-On, Ltd., operates 37 retail
and commercial stores that sell a wide range of standard office
supplies and products predominantly in small towns located in
Texas, New Mexico, Colorado, Oklahoma, Louisiana, Tennessee and
Alabama. The Debtor filed for chapter 11 protection on Nov. 19,
2005 (Bankr. N.D. Tex. Case No. 05-86875). Donald R. Rector,
Esq., at Glast Phillips & Murray, PC, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed total assets of $7,844,155 and total
debts of $14,971,386.
SIGNUM FINANCE: Credit Risks Spur S&P's Negative Watch
------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on 35
classes from 18 U.S. synthetic CDO transactions on CreditWatch
with negative implications. When combining pari passu tranches,
the 35 ratings represent 25 credit classes.
The CreditWatch placements are due to an update of Standard &
Poor's credit opinion regarding the risks associated with the
credit behavior of non-investment-grade entities. In addition,
S&P's assessment of how that behavior is correlated also has been
updated. The updated assumptions have been incorporated into
Standard & Poor's CDO Evaluator model, the latest version of which
was released for global synthetic CDO transactions.
Standard & Poor's expects to resolve the CreditWatch placements on
the affected ratings within 90 days and either lower or affirm the
rating assigned to each tranche. In the interim, Standard &
Poor's will work with arrangers to gather additional information
on the affected transactions, especially those that may be
restructured during this period. Absent any changes in the
transactions during the CreditWatch period, the most severe rating
action taken among the affected tranches would be a three-notch
downgrade. Barring any changes in the affected tranches,
approximately half of the potential actions would be one-notch
downgrades, and the remaining actions would be split evenly
between two- and three-notch downgrades.
The 35 tranches with ratings placed on CreditWatch negative
represent approximately 4% of Standard & Poor's total publicly
rated U.S. synthetic CDO tranches.
Ratings Placed On Creditwatch Negative
Archstone I PLC
Rating
Class To From
----- -- ----
2005-C1 A/Watch Neg A
2005-C2 A/Watch Neg A
Barton Springs CDO SPC Series 2005-1 SEG
Rating
Class To From
----- -- ----
D-1 BB+/Watch Neg BB+
D-2 BB+/Watch Neg BB+
Blue Point CDO SPC Series 2005-1
Rating
Class To From
----- -- ----
C-1 A/Watch Neg A
C-2 A/Watch Neg A
D-1 BBB/Watch Neg BBB
D-2 BBB/Watch Neg BBB
Blue Point CDO SPC Series 2005-2
Rating
Class To From
----- -- ----
C A/Watch Neg A
D BBB/Watch Neg BBB
Morgan Stanley ACES SPC Series 2005-14
Rating
Class To From
----- -- ----
II secured AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-15
Rating
Class To From
----- -- ----
II secured AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-18
Rating
Class To From
----- -- ----
SFRN AAA/Watch Neg AAA
Morgan Stanley ACES SPC Series 2005-22
Rating
Class To From
----- -- ----
Notes AAA/Watch Neg AAA
SALS 2004-A
Rating
Class To From
----- -- ----
F1 BB/Watch Neg BB
F2 BB/Watch Neg BB
Salt Creek High Yield CSO 2005-1 Ltd.
Rating
Class To From
----- -- ----
A-4$L AA-/Watch Neg AA-
A-6 A/Watch Neg A
A-6EL-1 A/Watch Neg A
A-6EL A/Watch Neg A
A-7 A-/Watch Neg A-
B-2 BBB/Watch Neg BBB
B-3$L BBB-/Watch Neg BBB-
B-5 BB/Watch Neg BB
B-6$L BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-5
Rating
Class To From
----- -- ----
E BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-7
Rating
Class To From
----- -- ----
Combo notes BB-/Watch Neg BB-
Signum Finance II PLC Series 2005-12
Rating
Class To From
----- -- ----
E BB-/Watch Neg BB-
Strata 2004-8 Ltd.
Rating
Class To From
----- -- ----
Floating rate notes BBB/Watch Neg BBB
Strata 2005-19 Ltd. Floating Rate Notes
Rating
Class To From
----- -- ----
FRN BBB-/Watch Neg BBB-
Sunset Park CDO Ltd. SPC Series 2004-4
Rating
Class To From
----- -- ----
B A-/Watch Neg A-
Sunset Park CDO Ltd. SPC Series 2005-5
Rating
Class To From
----- -- ----
B AA/Watch Neg AA
Sunset Park CDO-M Ltd. SPC Series 2005-3 SEG
Rating
Class To From
----- -- ----
D-1 AA-/Watch Neg AA-
D-2 AA-/Watch Neg AA-
E A-/Watch Neg A-
SNRG CORP: Losses Continue in Quarter Ended September 30
--------------------------------------------------------
SNRG Corporation, fka Texen Oil & Gas Inc., incurred a $332,802
net loss on $156,715 of revenue for the quarter ended Sept. 30,
2005, in contrast to a $701,432 net loss on $286,640 of revenue
for the comparable period in 2004.
The Company's balance sheet showed $3,061,751 in total assets as
of Sept. 30, 2005, and liabilities of $1,155,539. At Sept. 30,
2005, the Company had an accumulated deficit of $32,123,090.
Port Assets Purchase
On Aug. 17, 2005, SNRG acquired for $3 million and 3 million
warrants, 100% of the membership interests of Port Assets LLC,
owner of a facility in Bay City, Texas.
Constructed at an approximate cost of $79 million, the facility
was designed to recover and convert halogenated hydrocarbon waste
from the petro-chemical industry into hydrochloric acid and
synthesis gas. It has never operated since construction was
completed in 1998.
SNRG sold 51% of the membership interests to Bay City Partners LLC
on Aug. 31, 2005, for $2.85 million.
Going Concern Doubt
Williams & Webster, PS, expressed substantial doubt about SNRG's
ability to continue as a going concern after it audited the
Company's financial statements for the year ended Dec. 31, 2004.
The auditing firm pointed to the Company's operating losses and
significant impairment of oil and gas properties.
About SNRG
Houston-based SNRG Corporation -- http://www.snrg.net/-- is an
oil and gas exploration and development company with domestic
producing crude oil and natural gas properties. The Company
currently holds approximately 6,000 acres of crude oil and natural
gas reserves with the majority of acreage in shallow formation
fields for low cost exploration, drilling and production. It has
28 producing wells and has identified new well target zones with
strong well log data and the interpretation of 8.3 square miles of
3D seismic.
STONE ENERGY: Lenders Extend Financial Reporting Waiver to Mar. 31
------------------------------------------------------------------
Stone Energy Corporation (NYSE: SGY) received an extension of
waivers from its bank group. Stone previously announced that the
filing of its 2005 third quarter 10-Q and the restated annual
financial statements for 2004 and prior periods would be delayed
until March 2006, enabling Stone to have its reserves as of Dec.
31, 2005 audited by nationally recognized reserve consulting
firms, including a majority of the reserves being fully engineered
by these third party firms. Consistent with the revised schedule,
the original waivers from the lenders under its bank credit
facility through Dec. 15, 2005 were extended until Mar. 31, 2006.
Additionally, Stone has agreed to secure borrowings under its bank
credit agreement with a security interest in its oil and gas
properties. Stone currently has a borrowing base under the credit
agreement of $300 million, $176 million of which is borrowed or
committed, leaving $124 million of availability.
Stone Energy is an independent oil and gas company headquartered
in Lafayette, Louisiana, and is engaged in the acquisition and
subsequent exploration, development, operation and production of
oil and gas properties located in the conventional shelf of the
Gulf of Mexico (GOM), deep shelf of the GOM, deep water of the
GOM, Rocky Mountain basins and the Williston Basin.
* * *
As reported in the Troubled Company Reporter on Dec. 9, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
rating on independent oil and gas exploration and production
company Stone Energy Corp. to 'B+' from 'BB-'. The ratings remain
on CreditWatch with negative implications.
"The ratings action incorporates Standard & Poor's ongoing
concerns regarding the previous management's aggressive reserve
booking practices," said Standard & Poor's credit analyst Jeffrey
B. Morrison. "In addition, the action also reflects concerns
regarding the current management's ability to resolve ancillary
issues that have arisen since the company's announcement that it
would be taking a substantial downward revision to its proved
reserves," he continued.
As of June 30, 2005, the Lafayette, Louisiana-based company had
about $558 million in long-term debt.
STRUCTURED ASSET: Fitch Junks Ratings on Class B5 Certificates
--------------------------------------------------------------
Fitch Ratings has affirmed 47 and downgraded three classes of
Structured Asset Securities Corp. residential mortgage-backed
certificates:
Series 2001-16H
-- Class A affirmed at 'AAA';
-- Classes B1 and BX-1 affirmed at 'AAA';
-- Classes B2 and BX-2 affirmed at 'AA';
-- Class B3 affirmed at 'BBB';
-- Class B4 affirmed at 'BB';
-- Class B5 affirmed at 'B'.
Series 2002-10H
-- Class A affirmed at 'AAA';
-- Class B1 affirmed at 'AA';
-- Class B2 affirmed at 'A';
-- Class B3 affirmed at 'BBB';
-- Class B4 downgraded to 'B from 'BB';
-- Class B5 downgraded to 'C' from 'B'.
Series 2002-22H Group 1
-- Class 1A affirmed at 'AAA';
-- Class B1-I affirmed at 'AA';
-- Class B2-I affirmed at 'A';
-- Class B3-I affirmed at 'BBB';
-- Class B4-I affirmed at 'BB';
-- Class B5-I affirmed at 'B'.
Series 2002-22H Group 2
-- Class 2A affirmed at 'AAA';
-- Class B1-II affirmed at 'AA';
-- Class B2-II affirmed at 'A';
-- Class B3-II affirmed at 'BBB';
-- Class B4-II affirmed at 'BB';
-- Class B5-II affirmed at 'B'.
Series 2003-7H
-- Class A affirmed at 'AAA'
-- Classes B1-F and B1-III affirmed at 'AA';
-- Classes B2-F and B2-III affirmed at 'A';
-- Class B3 affirmed at 'BBB';
-- Class B4 affirmed at 'BB';
-- Class B5 downgraded to 'CCC' from 'B'.
Series 2003-23H
-- Class A affirmed at 'AAA';
-- Classes 1B1 and 2B1 affirmed at 'AA';
-- Classes 1B2 and 2B2 affirmed at 'A';
-- Class B3 affirmed at 'BBB';
-- Class B4 affirmed at 'BB';
-- Class B5 affirmed at 'B';
Series 2003-33H
-- Class A affirmed at 'AAA';
-- Classes 1B1 and 2B1 affirmed at 'AA';
-- Classes 1B2 and 2B2 affirmed at 'A';
-- Class B3 affirmed at 'BBB';
-- Class B4 affirmed at 'BB';
-- Class B5 affirmed at 'B'.
The affirmations on the above classes reflect adequate
relationships of credit enhancement to future loss expectations
and affect approximately $460.44 million of certificates.
Although cumulative losses as a percent of the original collateral
balance range from only 0% to 0.19%, the affirmed classes have
experienced small to moderate growth in CE since the last rating
action date.
The negative rating actions taken on series 2002-10H, classes B4
and B5, affect $351,732 of outstanding certificates and are the
result of cumulative pool losses and high delinquency levels.
Nov. 25, 2005 remittance information indicates that 5.44% of the
pool is currently over 90 days delinquent and cumulative losses
are 0.07% of the original pool balance. Realized losses have
averaged $18,519 a month over the past three months. Class B4
currently has 0.50% of credit support remaining. Even though the
CE has increased as a percentage of the original pool balance,
class B4 only has $180,668 of remaining CE. Class B5 currently
has 0.07% of credit support remaining.
The negative rating action taken on series 2003-7H, class B5,
affects $254,052 of outstanding certificates and is the result of
cumulative pool losses and high delinquency levels. Nov. 25, 2005
remittance information indicates that 1.80% of the pool is
currently over 90 days delinquent and cumulative losses are 0.08%
of the original pool balance. Realized losses have averaged
$31,004 a month over the past three months. Class B5 currently
has 0.02% of credit support remaining.
The pools are seasoned from a range of 25 to 49 months. The pool
factors range from approximately 9% to 57% outstanding.
The collateral consists of adjustable or fixed rate, conventional,
fully amortizing first lien residential mortgage loans.
Additionally, all of the mortgage loans have loan to value ratios
in excess of 80%. The mortgage loans generally are partially
covered by primary mortgage insurance polices issued by either
United Guaranty Corporation in connection with the Borrower
Advantage Program, or Mortgage Guaranty Insurance Corporation in
connection with the Pro Mortgage Program. The mortgage loans are
master serviced by Aurora Loan Services, Inc., which is rated
'RMS2+' by Fitch.
Further information regarding current delinquency, loss, and
credit enhancement statistics is available on the Fitch Ratings
Web site at http://www.fitchratings.com/
SUN HEALTHCARE: Court Enters Final Decree Closing Bankruptcy Case
-----------------------------------------------------------------
The Hon. Judith H. Wizmur of the U.S. Bankruptcy Court for the
District of Delaware entered a final decree on Dec. 13, 2005,
closing the chapter 11 case of Sun Healthcare Group, Inc.
As reported in the Troubled Company Reporter in March 2002,
pursuant to Sun Healthcare's confirmed plan:
* Approximately 88% to 90% of the New Common Stock
and a cash payment of $6,651,557 will be issued to
the Company's senior secured creditors.
* Approximately 8% to 10% of the New Common Stock is to be
issued to the holders of general unsecured claims that are
greater than $50,000.
* Approximately 2% of the New Common Stock as well as warrants
to purchase an additional 5% of the New Common Stock are to
be issued to the holders of senior subordinated notes.
* Holders of general unsecured claims of $50,000 or less shall
receive cash at the rate of 7% of their claims; and
* Holders of the Company's common stock, convertible
subordinated debt, and convertible trust-issued preferred
securities are to receive no distribution and those
instruments will be canceled.
A copy of the Debtor's final report is available for free at
http://researcharchives.com/t/s?3d8
Sun Healthcare Group, Inc., with executive offices located in
Irvine, California, owns SunBridge Healthcare Corporation and
other affiliated companies that operate long-term and postacute
care facilities in many states. In addition, the Sun Healthcare
Group family of companies provides therapy through SunDance
Rehabilitation Corporation, medical staffing through CareerStaff
Unlimited, Inc., and home care through SunPlus Home Health
Services, Inc.
The Company filed for chapter 11 protection on Oct. 14, 1999
(Bankr. D. Del. Case No. 99-03657). Mark D. Collins, Esq., and
Christina M. Houston, Esq., at Richards, Layton & Finger, P.A.,
represent the Debtor. The Court confirmed the Debtor's chapter 11
Plan on Feb. 6, 2002, and the Plan took effect on Feb. 28, 2002.
At Sept. 30, 2005, Sun Healthcare's balance sheet showed a
$109,509,000 stockholders' deficit, compared to a $123,380,000
deficit at Dec. 31, 2004.
T.A.T. PROPERTY: Todtman Nachami Approved as Bankruptcy Counsel
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave T.A.T. Property permission to employ Todtman, Nachami,
Spizz & Johns, P.C., as its general bankruptcy counsel, nunc pro
tunc to Oct. 14, 2005.
Specifically, the Firm will:
(a) provide legal advice with respect to the Debtor's power and
duties as debtor-in-possession in the operation of its
business and the management of its properties;
(b) take necessary action to protect and preserve the Debtor's
estate including the prosecution of actions on behalf of the
Debtor and the defense of actions commenced against the
Debtor;
(c) prepare, present and respond to, on behalf of the Debtor, as
debtor-in-possession, necessary applications and other legal
papers in connection with the administration of the Debtor's
estate;
(d) negotiate and prepare, on the Debtor's behalf, a plan of
reorganization, disclosure statement and related agreements
and take any necessary action on behalf of the Debtor to
obtain confirmation of that plan;
(e) appear in Court and protect the interests of the Debtor
before the Court; and
(f) perform all other legal services for the debtor-in-
possession which may be necessary and proper in its
chapter 11 proceedings.
The Firm's professionals bill these currently billing rates:
Professional Designation Hourly Rate
------------ ----------- -----------
Barton Nachamie Partner $495
ARthur Goldstein Partner $450
Jill L. Makower Associate $350
The Firm received a $15,000 retainer from Recal Associates, Ltd.,
a corporation owned by Michael Zenobio, one of the Debtors'
insiders.
Barton Nachamie, Esq., disclosed that his Firm does not represent
any interest adverse to the Debtor's estate.
Headquartered in New York, New York, T.A.T. Property filed for
chapter 11 protection on Oct. 14, 2005 (Bankr. S.D.N.Y. Case No.
05-47223). When the Debtor filed for protection from its
creditors, it listed $13,531,595 in assets and $13,522,435 in
debts.
TRUMP ENT: Board Approves $110 Mil. CapEx Plan for 2006 to 2007
---------------------------------------------------------------
Trump Entertainment Resorts, Inc. (NASDAQ NMS: TRMP), reported
that the first phase of its multi-year plan intended to
reinvigorate its Atlantic City gaming properties has received the
unanimous approval of the Company's Board of Directors. James B.
Perry, the Company's President and Chief Executive Officer,
commented, "The $110 million in capital improvements represents
the first phase of the renovation plan and will include projects
in 2006 and 2007 at Trump Taj Mahal, Trump Marina and Trump
Plaza."
Mr. Perry commented further, "The renovations include a variety of
projects designed to enhance the inherent strengths of each of the
three properties. Our goal is to focus on what matters most to
our customers, and to create unique and exciting venues designed
to add value to their Trump Atlantic City experience." Mr. Perry
continued, "These projects range from the creation of memorable
new food venues to the design and creation of entertainment
experiences that positively change the atmosphere as customers
enter our properties."
Anticipated projects at the Trump Taj Mahal include a $25 million
renovation of the entrance corridor from the parking garage into a
new retail and restaurant promenade, a new high-end Asian gaming
area and a new casino lounge and noodle bar. "We also plan on
making some changes to the casino floor to make the area
friendlier and more fun for our customers. Our plan is to bring
the activities that our customers care about closer to the action
on the gaming floor," Mr. Perry said.
Trump Plaza projects include a facelift to the property's original
oceanfront facade intended to increase the appeal of the property
from the Boardwalk, as well as changes to the lobby area to make
the property more accessible. The New Yorker restaurant will also
be completely renovated and replaced with a new $4 million food
venue. "When combined with the property's newly added Liquid Bar
and EVO Restaurant, the first floor from the Boardwalk exterior to
the hotel lobby will have a more exciting and contemporary look
and feel," Mr. Perry noted.
Trump Marina's scheduled projects include renovations to its
meeting and convention space, as well as the construction of a new
food venue. "We have a lot of great ideas for Trump Marina, and
we want to make the right choices based on what is important to
our customers," Mr. Perry said.
The $110 million in anticipated capital expenditures is in
addition to nearly $32 million that has been spent at the
Company's Atlantic City properties during 2005. "By the middle of
2006, we expect to have completely updated every standard guest
room at the three properties. The complete renovation of the
casino floor at Trump Plaza is also anticipated to be completed in
the first quarter of 2006," noted Mr. Perry.
The renovation capital is in addition to the funds already
allocated for the construction of an 800-room tower at the Taj
Mahal, as previously announced by the Company. Construction is
expected to start on the Taj Mahal's new tower in June 2006, with
an anticipated completion date in 2008.
"While we are very excited about these scheduled projects that are
designed to change our customers' perception of our properties, we
have also allocated maintenance capital to back-of-the-house
improvements for our employees," Mr. Perry said. Projects
budgeted for 2006 include new uniforms at the three properties, as
well as major renovations to the original employee cafeterias.
Headquartered in Atlantic City, New Jersey, Trump Hotels & Casino
Resorts, Inc., nka Trump Entertainment Resorts, Inc. --
http://www.thcrrecap.com/-- through its subsidiaries, owns and
operates four properties and manages one property under the Trump
brand name. The Company and its debtor-affiliates filed for
chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No.
04-46898 through 04-46925). Robert A. Klymman, Esq., Mark A.
Broude, Esq., John W. Weiss, Esq., at Latham & Watkins, LLP, and
Charles Stanziale, Jr., Esq., Jeffrey T. Testa, Esq., William N.
Stahl, Esq., at Schwartz, Tobia, Stanziale, Sedita & Campisano,
P.A., represent the Debtors in their successful chapter 11
restructuring. When the Debtors filed for protection from their
creditors, they listed more than $500 million in total assets and
more than $1 billion in total debts. The Court confirmed the
Debtors' Second Amended Plan of Reorganization on Apr. 5, 2005,
and the plan took effect on May 20, 2005.
* * *
As reported in the Troubled Company Reporter on Nov. 10, 2005,
Moody's Investors Service revised the outlook of Majestic Star
Casino, L.L.C. to developing following the announcement that it
will acquire Trump Entertainment Resorts Holdings, L.P.'s Gary,
Indiana riverboat casino for $253 million in cash, or about 8
times the casino property's latest twelve month EBITDA.
Concurrently, the ratings for both Majestic Star and Trump were
affirmed; Trump's rating outlook is stable. The acquisition is
expected to close by the end of 2005 and is subject to customary
approvals and consents.
These Trump ratings have been affirmed:
-- $200 million senior secured revolver due 2010 -- B2;
-- $150 million senior secured term loan due 2012 -- B2;
-- $150 million senior secured delayed draw term loan due
2012 -- B2;
-- $1.25 billion second lien senior secured notes due 2015 --
Caa1;
-- Speculative grade liquidity rating -- SGL-3; and
-- Corporate family rating -- B3.
TRUMP ENT: Holdings May Draw on Term B-2 Facility Until Nov. 2006
-----------------------------------------------------------------
Trump Entertainment Resorts Holdings, L.P., as borrower, inked an
amendment to the Credit Agreement, with:
* Trump Entertainment Resorts, Inc., as general partner and
guarantor;
* the subsidiary guarantors;
* Morgan Stanley Senior Funding, Inc., as initial lender;
* Morgan Stanley & Co. Incorporated, as collateral agent;
* Morgan Stanley Senior Funding, Inc., as administrative agent;
* UBS Securities LLC, as syndication agent;
* documentation agents:
-- Merrill Lynch Capital, and
-- Wells Fargo Foothill, Inc.; and
* joint lead arrangers and joint book-runners:
-- Morgan Stanley Senior Funding, Inc., and
-- UBS Securities LLC.
The subsidiary guarantors are:
* TCI 2 Holdings, LLC;
* Trump Indiana Realty, LLC;
* Trump Marina Associates, LLC;
* Trump Plaza Associates, LLC;
* Trump Taj Mahal Associates, LLC;
* Trump Entertainment Resorts Development Company, LLC;
* Trump Entertainment Resorts Funding, Inc.
The First Amendment amended the Credit Agreement to allow TER
Holdings to consummate the sale of all of the shares of Trump
Indiana, Inc., to Majestic Star Casino, LLC, pursuant to the Stock
Purchase Agreement, dated as of November 3, 2005, between TER
Holdings and Majestic Star.
In addition, the First Amendment extended the last date by which
TER Holdings may draw the Term B-2 Facility from May 20, 2006, to
November 20, 2006. The First Amendment also increased TER
Holdings' ability to make capital expenditures under the Credit
Agreement, as well as modifying the first lien leverage ratio and
debt leverage ratio that TER Holdings is required to maintain
under the Credit Agreement.
The First Amendment is conditioned on the consummation of the
Riverboat Sale and TER Holdings' payment of a fee to the lenders
equal to 0.10% of the $500 million aggregate principal amount of
commitments under the Credit Agreement, among other terms and
conditions.
Morgan Stanley reportedly beneficially owned 5,120,534 shares
of Trump Entertainment Resorts, Inc.'s common stock as of
Dec. 7, 2005, according to a Form 4 filing with the Securities and
Exchange Commission.
A full-text copy of the First Amendment to the Credit Agreement is
available for free at http://ResearchArchives.com/t/s?3d4
Headquartered in Atlantic City, New Jersey, Trump Hotels & Casino
Resorts, Inc., nka Trump Entertainment Resorts, Inc. --
http://www.thcrrecap.com/-- through its subsidiaries, owns and
operates four properties and manages one property under the Trump
brand name. The Company and its debtor-affiliates filed for
chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No.
04-46898 through 04-46925). Robert A. Klymman, Esq., Mark A.
Broude, Esq., John W. Weiss, Esq., at Latham & Watkins, LLP, and
Charles Stanziale, Jr., Esq., Jeffrey T. Testa, Esq., William N.
Stahl, Esq., at Schwartz, Tobia, Stanziale, Sedita & Campisano,
P.A., represent the Debtors in their successful chapter 11
restructuring. When the Debtors filed for protection from their
creditors, they listed more than $500 million in total assets and
more than $1 billion in total debts. The Court confirmed the
Debtors' Second Amended Plan of Reorganization on Apr. 5, 2005,
and the plan took effect on May 20, 2005.
* * *
As reported in the Troubled Company Reporter on Nov. 10, 2005,
Moody's Investors Service revised the outlook of Majestic Star
Casino, L.L.C. to developing following the announcement that it
will acquire Trump Entertainment Resorts Holdings, L.P.'s Gary,
Indiana riverboat casino for $253 million in cash, or about 8
times the casino property's latest twelve month EBITDA.
Concurrently, the ratings for both Majestic Star and Trump were
affirmed; Trump's rating outlook is stable. The acquisition is
expected to close by the end of 2005 and is subject to customary
approvals and consents.
These Trump ratings have been affirmed:
-- $200 million senior secured revolver due 2010 -- B2;
-- $150 million senior secured term loan due 2012 -- B2;
-- $150 million senior secured delayed draw term loan due
2012 -- B2;
-- $1.25 billion second lien senior secured notes due 2015 --
Caa1;
-- Speculative grade liquidity rating -- SGL-3; and
-- Corporate family rating -- B3.
U.S. INVESTIGATIONS: $150M Loan Plan Spurs S&P's Negative Outlook
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on security
services provider U.S. Investigations Services Inc. to negative
from stable.
At the same time, Standard & Poor's affirmed its 'B+' corporate
credit and amended senior secured bank facility ratings.
The facility now consists of:
* a $30 million revolving credit facility due 2011,
* a $400 million Term Loan B due 2012, and
* a proposed incremental $150 million Term Loan C due 2012.
As of Sept. 30, 2005, the Annandale, Pennsylvania-based company
had about $550 million of consolidated debt outstanding, which
excludes the proposed $150 million incremental term loan and
operating lease obligations.
The revised outlook reflects the company's plan to issue
$150 million in incremental term loan debt to its existing credit
facility.
"As a result of higher debt levels, credit measures will weaken,
and financial policy is expected to become more aggressive," said
Standard & Poor's credit analyst Mark Salierno.
This new debt issuance closely follows USIS's September 2005
recapitalization in which a $185 million dividend was paid to
shareholders, including, the company's financial sponsor, which
contributed to a one-notch downgrade of the company at that time.
UAL CORPORATION: Files 21st Reorganization Status Report
--------------------------------------------------------
James H.M. Sprayregen, Esq., at Kirkland & Ellis, in Chicago,
Illinois, relates that UAL Corporation and its debtor-affiliates
continue to progress toward confirmation of their proposed Plan of
Reorganization.
To build consensus on various plan confirmation issues, the
Debtors held numerous meetings with key constituents,
particularly the Official Committee of Unsecured Creditors.
Through this open and ongoing dialogue, the Debtors resolved a
number of creditor concerns and remain on pace with their current
exit schedule.
According to Mr. Sprayregen, the pre-trial conference on Plan
confirmation is continued to January 17, 2006. In the interim,
the Debtors are responding to discovery requests propounded by
various parties on a rolling basis.
The Plan-voting Deadline expired on December 19, 2005. During
the six-week balloting period, the Debtors worked closely with
their solicitation agent to ensure what has been a smooth voting
process.
Mr. Sprayregen relates that in November, the Debtors continued to
refine the mechanics for making distributions under the Plan, and
resolve unsecured claims against the estate to maximize
distributions to unsecured creditors as soon as possible after
emergence. To this end, the Debtors have reduced the claims
register by almost $300,000,000 by negotiating agreements with
numerous owner participants to cap their aircraft tax indemnity
claims. Additionally, the Debtors submitted an order in early
December to reduce the $1,300,000,000 claim asserted by Atlantic
Coast Airlines to $500,000,000 based on a Court ruling. The
Debtors also sought Court approval of their settlement agreement
with Pratt & Whitney, their largest supplier of turbine engines
and associated parts, to resolve more than $12,200,000 in
unsecured and administrative claims asserted against the Debtors'
estate.
According to the U.S. Department of Transportation Air Travel
Consumer Report for October 2005 issued on December 1, the
Debtors ranked first among the seven major network carriers
in on-time arrivals -- 14 for the month, with 83% of flights
arriving within 14 minutes of schedule. The Debtors also placed
first among this group with the lowest mishandled baggage rate
for the fourth consecutive month, and had the fewest flight
cancellations.
On December 1, 2005, the Debtors:
* implemented their same-day flight change policy which is
expected to generate millions of dollars in annual
incremental revenue, by charging customers who hold a
discounted domestic ticket in United economy class $25 to
secure a reservation on a different flight, departing that
same day; and
* announced new routes and increased service to 10 domestic
U.S. and nine international destinations from their Dulles
hub.
In November 22, 2005, the company announced new United Express
service between San Antonio, Texas, and seven cities.
With the Plan confirmation hearing approaching, Mr. Sprayregen
assures Judge Wedoff that the Debtors will continue to work with
their stakeholders to resolve outstanding Plan issues on a
consensual basis to ensure a smooth process up through and post
confirmation.
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. 109; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
UAL CORP: Confirmation Objections to Amended Chapter 11 Plan
------------------------------------------------------------
UAL Corporation and its debtor-affiliates received 55 objections
to their First Amended Plan of Reorganization, 20 of which were
submitted by pro se parties. Many of the objections were limited
in nature, only requesting clarifications of Plan provisions or
seeking reservations certain legal rights.
Jake Brace, the Debtors' chief financial officer, said that
details of the Plan still are being worked out, according to the
Chicago Tribune. Once it is finalized, the Plan will be shared
with the unions and the Official Committee of Unsecured
Creditors, Mr. Brace said.
Mr. Brace also said the Plan objections will be resolved without
interrupting the airline's exit schedule.
As previously reported, creditors had until Dec. 19, 2005,
to vote on the Plan. Voting results will be announced on or
before December 30, 2005.
Confirmation Objections
A. IAM
The International Association of Machinist and Aerospace Workers
argues that the Debtors' Management Equity Incentive Plan and
Director Equity Incentive Plan under the Reorganization Plan were
not proposed in good faith and, therefore, violate Section 1129
of the Bankruptcy Code.
Sharon L. Levine, Esq., at Lowenstein Sandler, in Roseland, New
Jersey, asserts that the Incentive Plans are unwarranted under
the circumstances of the Chapter 11 cases because the Debtors'
management and board of directors have not demonstrated a need
for a windfall bonus in the face of the many stakeholders working
towards a restructuring and taking economic sacrifices.
"In more than three years operating under bankruptcy protection,
the Debtors' management and board failed to fully repair the
Debtors' business or make it profitable," Ms. Levine contends.
The Debtors suffered from a net loss of well over $16,000,000,000
since the Petition Date. The Debtors' businesses have lost money
in virtually each of the 36 months since the Petition Date.
Rather then stabilizing the Debtors' operations, management
limped their way to an agreement with the exit financiers by
cobbling together savings from represented employees and other
stakeholders.
According to Ms. Levine, the equity available for Incentive Plans
should be allocated to IAM-represented employees and other
constituencies whose sacrifices have enabled the Debtors to
reorganize.
Since the Incentive Plans fail to withstand the required
heightened scrutiny given to insider transactions, and
result in unfair treatment of the IAM-represented employees, IAM
wants confirmation of the Plan denied unless the two Incentive
Plans are excised from it.
B. URPBPA
On behalf of the United Retired Pilots Benefit Protection
Association, Frank Cummings, Esq., at LeBoeuf, Lamb, Greene &
MacRae, in Washington, D.C., informs the Court that the Debtors'
Plan must not be approved because:
(a) The Plan is not equitable in that the retired pilots will
not be provided compensation for the loss of pension
benefits similar to the compensation to be provided to the
Air Line Pilots Association and the active pilots;
(b) The third party release provisions would purport to enjoin
litigation between an "ALPA Released Party," which refers
to the ALPA and various individuals and entities
associated with the ALPA, and the Debtors' retired pilots.
Bankruptcy courts do not have the jurisdictional or
statutory authority to enter orders permanently enjoining
litigation between non-debtor parties;
(c) The Debtors' refusal to provide voting ballots which
acknowledge the non-qualified claims of pilots who retired
in 2005 warrants disapproval of the Plan;
(d) The Management and Director Equity Incentive Plans
violates the Bankruptcy Code in that both Incentive Plans:
-- fail to provide sufficient information regarding the
benefits that will be provided under the Incentive
Plans; and
-- do not place appropriate limitation on the awards
that may be provided to directors and management
because the Incentive Plans are unfair to the
Debtors' retired pilots and other retirees,
employees, and unsecured creditors who have
sacrificed so much in connection with the Debtors'
reorganization efforts.
C. AFA
The Association of Flight Attendants-CWA, AFL-CIO informs the
Court that the Debtors' proposed Management Equity Incentive
Plan, and the Debtors' reservation of the rights to reject the
AFA's collective bargaining agreement after confirmation,
preclude confirmation of the Reorganization Plan.
Robert S. Clayman, Esq., at Guerrieri, Edmond, Clayman & Bartos,
in Washington, D.C., notes that the MEIP would reserve 15% of the
Debtors' total equity at exit for grants to 400 unnamed, senior
executives, which would have a value at exit of $285,000,000.
However, the Debtors have provided virtually no details regarding
how the shares reserved under the MEIP would be allocated to the
eligible recipients. Nor have Debtors provided any information
regarding the total compensation of the employees, which makes it
impossible to evaluate the fairness of any individual grant under
the MEIP.
What is clear, Mr. Clayman says, is that the MEIP does not
reflect either sound business judgment or good faith, much less
respect for the enormous sacrifices employees have made to keep
United flying.
Furthermore, the Debtors have long forfeited their right to
reject their collective bargaining agreement with AFA.
D. ALPA
The Air Line Pilots Association, International, asks the Court to
deny approval of the Debtors' Plan of Reorganization because it
contains provisions that are inconsistent with the restructuring
agreements the ALPA negotiated with the Debtors during the
Chapter 11 cases.
ALPA also disputes the Management Equity Incentive Plan proposed
under the Debtors' Plan because the proposed equity grant is
excessive and insensitive in light of the substantial wage and
benefit reductions -- including the termination of the pilots'
defined benefit plan -- sustained by the pilots during the
reorganization, and, therefore, constitutes an unreasonable
payment for services in connection with the Debtors' Plan.
E. Creditors Committee
The Debtors and the Official Committee of Unsecured Creditors are
currently involved in ongoing discussions concerning:
-- the size and terms of the Management Equity Incentive
Program under the Plan;
-- the composition of the post-emergence Board of Directors
and other corporate governance issues;
-- the disposition of Plan consideration reserved by the
Debtors;
-- the treatment of executory contracts, unexpired leases and
retained causes of action; and
-- the scope of rights and remedies of a plan oversight
committee.
While progress has been made and is continuing, Fruman Jacobson,
Esq., at Sonnenschein, Nath & Rosenthal, in Chicago, Illinois,
notes that a number of the Committee's concerns remain open.
To preserve its right to pursue any remaining objections to the
Plan at the Confirmation Hearing, the Committee informs Judge
Wedoff that the Debtors have not publicly disclosed or made
available to the Committee their proposal for the total
compensation packages for the senior-level executives, taking
into account salary, bonuses, KERPs and other benefits in
addition to the proposed equity allocation in the MEIP. The lack
of disclosure makes it impossible to evaluate whether the MEIP
can be justified.
Mr. Jacobson argues that the Plan fails to meet the standards of
disclosure and corporate process embodied in the confirmation
requirements because the Debtors have declined to provide fair
board representation to the new shareholders.
The Plan also provides for the improper preservation of the
Debtors' ability to defer assumption or rejection of certain
executory contracts and unexpired leases post-confirmation.
Notwithstanding these objections, however, the Committee fully
supports the Debtors' intention to emerge from Chapter 11 in
February 2006, Mr. Jacobson says.
F. Wells Fargo Bank Northwest
Wells Fargo Bank Northwest N.A., in its capacity as Class A Pass
Through Trustee of the 1997-1 EETC Transaction, asserts that the
Plan fails to provide a mechanism for the discharge of the
amounts due and owing to the holders of the 1997-1 Class A EETC
Certificates, and fails to provide for equal treatment of all
Secured Aircraft Creditor Claims, while at the same time
providing an injunction against certain actions, including
repossession of aircraft. This violates not only the
requirements for a confirmable plan, but also Section 1110 of the
Bankruptcy Code by taking away the remedies available to the
Trustee and the controlling certificateholders.
G. Aircraft Trustees
U.S. Bank National Association, The Bank of New York and Wells
Fargo Bank, N.A., each in their capacities as Indenture Trustee,
Pass Through Trustee, Subordination Agent or Collateral Agent,
are parties to a Settlement and Term Sheets with Controlling
Holders for Public Debt Aircraft approved by the Court. The Term
Sheets provided for the restructuring of 16 of the transactions
for the Public Debt Aircraft remaining in United's fleet.
The Trustees want the definition of Public Debt Aircraft in the
Plan expanded to include those transactions that settled their
Administrative Claims and Deficiency Claims with United as
approved by the Settlement Order. The Plan should also provide
settlements consistent with the Term Sheets.
The Debtors and the Trustees are in the process of documenting
the transactions contemplated by the Term Sheets. The Trustees
reserve their rights in the event issues arise in connection with
the documentation.
H. More Objections
Other parties that object to the confirmation of the Debtors'
Plan include:
(1) Morris Wiegand;
(2) Julian Hamburger;
(3) Joseph and Catherin Riggio;
(4) Barnita P. Vann;
(5) Daniel W. Osband;
(6) H. Benjamin Hardy Jr.;
(7) Jimella Martin Harris;
(8) The United States Government;
(9) Illinois Department of Revenue;
(10) The New York State Department of Taxation and Finance;
(11) California Statewide Communities Development Authority;
(12) California Department of Toxic Substances Control;
(13) The Texas Comptroller of Public Accounts;
(14) Travelers Casualty and Surety Company of America;
(15) New Jersey Self-Insurers Guaranty Association;
(16) The City of Des Moines, Iowa;
(17) The City of Chicago, Illinois;
(18) The City of Phoenix, Arizona;
(19) The City of Philadelphia, Pennsylvania;
(20) Veritas Software Global Corporation;
(21) Airbus Leasing VI, Inc.;
(22) Dorothy Abercrombie, et al.;
(23) Best Western International, Inc.;
(24) Sky King, Inc.;
(25) Beacon Chemical Company;
(26) Sabre, Inc.;
(27) Independence Air, Inc.;
(28) First Source Bank;
(29) The Dow Chemical Company and Union Carbide Corporation;
(30) Stark Investments, L.P., and Shepherd Investments
International, Ltd.;
(31) Bexar County, Dallas County, Harris County/City of
Houston, Houston Independent School District and
Tarrant County;
(32) Jack M. McGahey; and
(33) Forrest P. Smith Jr.
The City of Phoenix leases certain airport terminal facilities
and airport cargo facilities to the Debtors. Phoenix objects to
the Plan to the extent it provides for the assumption of the
unexpired leases without first providing adequate assurance that
the Debtors will promptly cure their defaults under the leases
and will perform in the future under the leases. Without
assurance from the Debtors, the Plan violates Sections
365(b)(1)(A), 365(b)(1)(C) and 1129(a)(1) of the Bankruptcy Code
and the leases cannot be assumed, making the Plan unconfirmable.
The City of Des Moines and United are parties to prepetition
contracts relating to Des Moines International Airport. Des
Moines contends that the Plan impermissibly permits the Debtors
to (i) change their minds and reject the Des Moines Leases after
the Leases were assumed and after the Effective Date of the Plan,
(ii) unilaterally select an Effective Date for rejection of the
Des Moines Leases -- if the Debtors change their minds and reject
the Leases -- that is after the Effective Date, and (iii) shift
the burden of proof to the City regarding the Debtors' obligation
to provide adequate assurance that all defaults under the Des
Moines Leases will be promptly cured following assumption.
The Texas Taxing Authorities assert secured ad valorem tax claims
against the Debtors and prior perfected liens against the estate
property. The Taxing Authorities complain that the Plan fails to
recognize their lien rights. The Plan also fails to provide for
postpetition and pre-confirmation interest as required under
Section 506(b). The 0% interest rate is inadequate to protect
the present value of their tax claims. The Taxing Authorities
insist they are entitled to 12% interest rate per annum.
New Jersey Self-Insurers Guaranty Association provides a guaranty
fund for the benefit of workers compensation claimants employed
by entities choosing to self-insure their workers compensation
obligations. The Guaranty Association wants the Debtors' plan
clarified that the workers compensation benefits will be honored
pursuant to applicable law not only in those states in which the
Debtors operate, but in those states where the Debtors have
discontinued or will discontinue operations. The Plan contains
an ambiguity as to whether the Debtors will honor workers
compensation claims in those states where they cease operations.
At the same time, the Plan purports to extinguish workers
compensation proofs of claim, including the Guaranty
Association's claim. If workers compensation proofs of claim are
to be summarily extinguished, the ambiguity must be clarified and
resolved. Absent clarification, the Guaranty Association says
the Plan extinguishes claims without a valid statutory basis, and
is unconfirmable.
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. 109; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
UNIFLEX INC: Court Confirms Amended Joint Liquidation Plan
----------------------------------------------------------
The Honorable Mary F. Walrath of the U.S. Bankruptcy Court for the
District of Delaware confirmed the Amended Joint Plan of
Liquidation filed by UFI Liquidating Corporation, aka Uniflex Inc.
Judge Walrath determined that the Plan met the 13 standards for
confirmation required under Section 1129(a) of the Bankruptcy
Code.
As previously reported in the Troubled Company Reporter, Judge
Walrath put her stamp of approval on a disclosure statement
explaining the economic assumptions underpinning the Joint Plan on
Sept. 26, 2005.
Summary of the Amended Joint Plan
The Official Committee of Unsecured Creditors will designate the
Liquidating Trust Trustee pursuant to the terms of Liquidating
Trust Agreement. On or after the Effective Date of the Plan, all
of the Debtor's Cash and Assets, including but not limited to
Causes of Action will be transferred to the Liquidating Trust for
liquidation and distribution in accordance with the terms of the
Plan and the Liquidating Trust Agreement.
Proceeds of the Liquidating Trust will be distributed to holders
of Allowed Claims in accordance with the terms of the Plan and the
priority of claims provisions of the Bankruptcy Code. The Post-
Confirmation Debtor will be dissolved as soon as practicable after
the final distributions under the Plan are made.
Treatment of Claims and Interests
The Plan groups claims and interests into four classes.
Unimpaired Claims consist of:
1) Other Priority Claims, which will be paid in full in Cash,
without interest, in their respective order of priority
pursuant to Section 507 of the Bankruptcy Code, on the later
of the Effective Date or the date on which those Claims
become an Allowed Claims. The legal, contractual and
equitable rights of each Allowed Other Priority Claims will
be left unaltered; and
2) Miscellaneous Secured Claims, which will receive either:
a) the return of the collateral securing those Claims, or
b) the net proceeds from the disposition of the collateral
securing those Claims without representation or warranty
by or recourse against the Debtor or the Post-
Confirmation Debtor, or
c) other treatment that will be agreed to between the
holders of Miscellaneous Secured Claims and the Debtor or
the Liquidating Trustee acting behalf of the Post-
Confirmation Debtor.
Impaired Claims consist of:
1) General Unsecured Claims, which will receive their Pro Rata
share of:
a) the Cash on hand on the Effective Date after payment of
Allowed Administrative Claims, Priority Tax Claims,
Priority Claims in Class 1 and any claims in Class 2,
b) the Proceeds of Avoidance Actions, if any, and the
Proceeds of Causes of Actions, if any,
c) the remaining Proceeds of the Litigation Reserve,
d) the Proceeds of any remaining property, including but not
limited to the Liquidating Trust Expense Reserve,
exclusive of any reserves established by the Liquidating
Trust Trustee for Disputed Claims, and with respect to
(a) through (c) above, less the Liquidating Trust
Expenses; and
2) Interests, which will receive no distributions and on the
Effective Date, all Interests will be cancelled, null and
void and of no force and effect.
A full-text copy of the Amended Joint Plan is available for a fee
at:
http://www.researcharchives.com/bin/download?id=051102024826
Headquartered in Hicksville, New York, Uniflex, Inc., dba UFI
Liquidating Corporation -- http://www.uniflexbags.com/-- makes
custom-printed plastic bags and other plastic packaging for
promotions and advertising. The Company filed for chapter 11
protection on June 24, 2004 (Bank. Del. Case No. 04-11852). Peter
C. Hughes, Esq., at Dilworth Paxson LLP, represents the Debtor in
its restructuring efforts. When the Debtor filed for protection
from its creditors, it estimated debts and assets of $10 million
to $50 million.
UNITED WOOD: Gets Okay to Hire Walker Warren as Special Counsel
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Oregon gave United
Wood Products Company permission to employ Walker, Warren and
Watkins as its special counsel.
Walker Warren will represent the Debtor in Kimberly-Clark lawsuit.
Kimberly-Clark asserted $500,000 claims against the Debtor and
James Winters for breach of contract.
Ernest Warren, Esq., at Walker Warren, discloses that the Debtor's
liability insurance carrier, Alaska National Insurance Company,
will bill his services for $225 per hour and the firm's legal
assistant, Kathy Gray, for 85 per hour.
Additionally, the firm is prosecuting the Debtor's counterclaims
against Kimberly-Clark on a contingency fee basis.
Under the contingency fee agreement, Walker Warren will be
entitled to:
* 33-1/3% of all amounts obtained for the Debtor by judgment or
by settlement in excess of $4 million and $10 million or
less, and
* 40% of all amounts obtained for the Debtor by judgment or
settlement in excess of $10 million.
To the best of the Debtor's knowledge, Walker Warren does not
represent or hold any interest adverse to the Debtor or its
estate.
Headquartered in Portland, Oregon, United Wood Products Company,
aka United Oil Company, filed for chapter 11 protection on
Sept. 19, 2005 (Bankr. D. Ore. Case No. 05-41285). John G.
Crawford, Jr., Esq., at Schwabe, Williamson & Wyatt represents the
Debtor in its restructuring efforts. As of Sept. 30, 2005, the
Debtor listed total assets of $58,622,000 and total debts of
$3,181,125.
WCI STEEL: Settles Seaways $405,588 Maritime Lien Claim
-------------------------------------------------------
WCI Steel, Inc., asks the U.S. Bankruptcy Court for the Northern
District of Ohio, Eastern Division, to approve the Settlement and
Release Agreement with Seaway Marine Transport.
The agreement resolves all pending claims between the Debtor and
Seaway arising from adequate protection payments made to Seaway in
2003. The Bankruptcy Court had authorized the Debtors to make
maritime lien payments, totaling approximately $405,588, to induce
Seaway to continue its shipping services to the Debtor. The
Debtor made the initial $100,000 payment in Oct. 2003.
On Dec. 9, 2003, the Debtor commenced an adversary proceeding
against Seaway questioning the validity of the maritime liens and
seeking damages for unjust enrichment. Seaway subsequently filed
a proof of claim for $405,588.
On Sept. 28, 2005, the Court granted the Debtor's motion for
summary judgment and invalidated the maritime lien payments. The
Court also directed Seaway to repay the $100,000 it had received
from the Debtor.
The Settlement
Pursuant to the settlement agreement, Seaway agrees to retain the
$100,000 payment in full settlement and satisfaction of its
maritime liens. Seaway will withdraw its $405,588 claims against
the Debtor's estate upon the entry of a final and non-appealable
court order approving the settlement agreement.
WCI Steel, Inc., is an integrated steelmaker producing more than
185 grades of custom and commodity flat-rolled steel at its
Warren, Ohio facility. WCI products are used by steel service
centers, convertors and the automotive and construction markets.
WCI Steel filed for chapter 11 protection on Sept. 16, 2003
(Bankr. N.D. Ohio Case No. 03-44662). Christine M. Pierpont,
Esq., and G. Christopher Meyer, Esq., at Squire, Sanders &
Dempsey, L.L.P., represent the Company. When WCI Steel filed for
chapter 11 protection it reported $356,286,000 in total assets and
liabilities totaling $620,610,000.
WESTLIN CORPORATION: Court Confirms Ch. 11 Plan of Reorganization
-----------------------------------------------------------------
The U.S. Bankruptcy for the Southern District of Texas confirmed
the Plan of Reorganization filed by Westlin Corporation. The Hon.
Karen Brown approved the proposed order submitted by Westlin,
ruling that the company has satisfied the necessary requirements
for confirmation of its plan.
"We are nearing the end of our reorganization with the Court's
confirmation of the plan standing as one of the final milestones."
said David Herr, Westlin's President. "Westlin has overcome many
obstacles in the past year, and we look forward to continuing to
serve our customers and focus on providing a unique suite of
services related to Disaster Recovery and Business Continuity
Services. The Chapter 11 process was difficult but necessary, and
we're pleased that we were able to overcome many previous issues
and position the company for the future while keeping the
shareholders intact during the process."
As reported in the Troubled Company Reporter on Dec. 1, 2005, the
plan offered by the company provides for full payment of its
creditors and preserves current public stockholder equity with
some dilution.
Headquartered in Houston, Texas, Westlin Corporation --
http://www.westlin.com/-- is an Internet technology company
engaged in Disaster Recovery and Business Continuity business
lines. Its operation, located in a former Nuclear Fallout Shelter
provides one of the most secure environments for on-line and near-
line data storage, safe from natural disasters and terrorist acts.
The company filed for chapter 11 protection on Sept. 3, 2004
(Bankr. S.D. Tex. Case No. 04-42765). Julie Mitchell Koenig,
Esq., at Tow and Koenig PLLC, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it estimated less than $50,000 in assets and
between $1 million to $10 million in liabilities.
WESTSIDE LOFTS: Case Summary & 19 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Westside Lofts, LLC
1408 North Westshore Boulevard, Suite 140
Tampa, Florida 33607
Bankruptcy Case No.: 05-60264
Type of Business: The Debtor is a residential
real estate developer.
Chapter 11 Petition Date: December 20, 2005
Court: Southern District of Florida (Miami)
Judge: A. Jay Cristol
Debtor's Counsel: John W. Kozyak, Esq.
Corali Lopez-Castro, Esq.
Kozyak Tropin & Throckmorton, P.A.
2525 Ponce de Leon Boulevard, 9th Floor
Coral Gables, Florida 33134
Tel: (305) 372-1800
Fax: (305) 372-3508
Total Assets: $3,500,000
Total Debts: $3,803,056
Debtor's 19 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Diez Construction Corporation Construction Lien $200,506
Attn: Joaquin Diez
4967 SW 75 Avenue
Miami, FL 33155
London Real Estate Company Construction Lien $153,072
50 West Mashta Drive, Suite 5
Key Biscayne, FL 33149
J & M Scaffolds of Florida Inc. Construction Lien $143,475
Attn: Jessica Martinez
11050 NW 36 Avenue
Miami, FL 33161
Gerard Binder & Judy Binder Deposit $85,800
Shoreline Foundation, Inc. Construction Lien $84,918
K & A Lumber Company Construction Lien $74,771
Ahmad Ido Deposit $74,000
Russell Root Deposit $70,000
Tarmac America LLC Final Judgment $61,089
Massimo Martinelli Deposit $59,998
Nighat Naseer Deposit $39,243
Dominic (Dennis) Delgado Deposit $37,500
Anthony Johnson Deposit $35,886
Florida Lumber Company Deposit $35,505
Paolo E. Benavides Deposit $35,000
Sargis Sargsian Deposit $33,000
Roberto E. Berrias Deposit $25,990
Century Everglades LLC Construction Lien $22,302
Lopefra Corporation Construction Lien $9,935
WINN-DIXIE: Files First Quarter Financial Results for Fiscal 2006
-----------------------------------------------------------------
Winn-Dixie Stores, Inc., filed its quarterly report on Form 10-Q
with the Securities and Exchange Commission in which it reported
financial results for the first quarter of its 2006 fiscal year
ending on September 21, 2005.
Selected highlights from the Company's recent operating
performance are:
* Improving sales trend. Identical store sales for continuing
operations stores, which include store enlargements and
exclude the sales from stores that opened or closed during
the period, decreased 2.9% for the first quarter of 2006
compared to the same period in the prior year, and increased
2.9% for the first eight weeks of the 2006 second quarter
compared to the same period during fiscal 2005. This
represents an improvement from the 4.5% decline in identical
store sales in the third and fourth quarters of fiscal 2005.
* Improved borrowing availability. The Company's borrowing
availability under its Debtor-in-Possession financing has
improved from the end of Fiscal 2005 through the November
monthly operating period, to approximately $182.2 million
as of November 16, 2005, from $170.7 million as of
June 29, 2005.
* Major restructuring activities completed. During the first
quarter of 2006, the Company implemented a major strategic
restructuring program to focus the Company's resources on its
strongest markets and streamline its distribution and
manufacturing operations. Under this plan, the Company has
exited 326 stores, along with 3 distribution centers and
6 manufacturing facilities. With these actions now completed,
the Company believes that it now has in place the right store
footprint and infrastructure to move forward in achieving its
turnaround plan.
Peter Lynch, Winn-Dixie President and Chief Executive Officer,
said "We are very pleased with the progress we are making.
Although it may not be immediately obvious from our financial
reports, we have generally met or exceeded our internal
performance objectives so far in fiscal 2006. Clearly, the
operational improvements we have been implementing are beginning
to pay off, thanks to the dedication and loyalty of our associates
and the continued support of our customers and suppliers. To be
sure, there is still a lot of hard work and challenges ahead for
our company, but we believe we are making steady improvement and
building momentum."
Mr. Lynch continued, "In addition to the recent improvement in our
identical store sales, we are seeing increased anecdotal evidence
that our turnaround efforts are succeeding. We are receiving more
and more letters, emails and phone calls from customers who are
noticing that we are getting better all the time. They see an
improved attitude and energy level among our associates and better
and fresher merchandise on our shelves."
He concluded, "We look forward to working with the creditors and
equity committees, as well as our lenders and other interested
parties, to begin mapping out a plan of reorganization. Our
objective is for Winn-Dixie to emerge from the Chapter 11 process
by June 2006."
A full-text copy of the Form 10-Q filing is available for free at
http://ResearchArchives.com/t/s?3d5
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, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 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.
WORLDCOM INC: Court Orders $2,070,000 Escrow Disbursed to MCI
-------------------------------------------------------------
Judge Gonzalez authorizes Gaylord, Merlin, Ludovici, Diaz & Bain
to immediately disburse $2,070,000 out of the principal sum held
in the Escrow Account to MCI, Inc.
The U.S. Bankruptcy Court for the Southern District of New York
directs Gaylord Merlin to retain $1,600,000 in principal in the
Escrow Account until further Court order.
Judge Gonzalez further authorizes Gaylord Merlin to disburse to
MCI 56.4% of the interest accrued to date on the proceeds from the
Condemnation Action. Gaylord Merlin will retain the remainder of
the accrued interest in the Escrow Account.
Judge Gonzalez clarifies that the Order is without prejudice to
the rights of MCI and Dobie Properties, LLC, with respect to the
principal of $1,600,000 and accrued interest retained in the
Escrow Account.
As previously reported in the Troubled Company Reporter on
September 20, 2005, Judge Gonzalez rules that the funds held in
the Registry will be deposited into a segregated, interest bearing
account to be maintained by Gaylord Merlin Ludovici Diaz & Bain,
pending resolution of the parties' competing claims.
The Court further orders that no disbursement of the funds from
the Escrow Account will be made without a written agreement of
both parties or further Court Order.
The Court sets a hearing on October 11, 2005, to determine the
parties' rights with respect to the funds recovered in the
Condemnation Action and held in the Escrow Account.
Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532). On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts. The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc. (WorldCom
Bankruptcy News, Issue No. 109; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
*********
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 ***