/raid1/www/Hosts/bankrupt/TCR_Public/060329.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, March 29, 2006, Vol. 10, No. 75
Headlines
ACCO BRANDS: Will Prepay $25 Million of Senior Secured Term Loan
ACURA PHARMA: Secures $750K Bridge Funding for Product Development
ADVANSTAR COMM: Moody's Puts B2 Rating on Proposed $75 Mil. Loan
AEARO TECHS: S&P Puts B Corp. Credit Rating with Stable Outlook
ALLIANCE ATLANTIS: Earns $24.8 Million in Fourth Quarter of 2005
ALLIED HOLDINGS: Court Approves Haymaker/Bean as Broker
ALLIED HOLDINGS: Court Approves DaimlerChrysler Contract
AMCAST INDUSTRIAL: Panel Has Until April 1 to Contest Bank's Liens
ANCHOR GLASS: Inks Amended Agreement with General Chemical
ANCHOR GLASS: Court Directs Officers to File Statements
ANDREW CORP: S&P Affirms BB Rating & Revises Outlook to Positive
AQUA SOCIETY: December 31 Balance Sheet Upside-Down by $664,547
ATA AIRLINES: Keycorp Leasing Wants $1.6 Million Admin. Claim Paid
ATA AIRLINES: Names Josef Loew as Scheduled Service Senior VP
ATLAS PIPELINE: Reports $10.9 Mil. of Net Income in 4th Quarter
AUTONATION INC: Receives Required Consents for 9% Senior Notes
BALL CORP: Completes Acquisition of U.S. Can's Two Operations
BENCHMARK ELECTRONICS: Declares 3-for-2 Stock Split
BIRCH TELECOM: Has Until April 8 to Remove Civil Actions
BLOCKBUSTER INC: Registers 7-1/2% Preferred Stock for Resale
BLOCKBUSTER INC: Exchanging 9% Sr. Sub. Notes for Registered Bonds
BMC INDUSTRIES: Committee Wants More Data in Disclosure Statement
BOOKHAM INC: All 7% Conv. Debentures Converted to Common Stock
CALPINE CORP: Court Issues 2nd Amended Final Cash Collateral Order
CARMIKE CINEMAS: Moody's Holds Junked Senior Subord. Note Rating
CATHOLIC CHURCH: DuFresne Wants Portland to Account for Properties
CENDANT CAR: Moody's Rates $1 Billion Unsecured Notes at Ba3
CENTURY ALUMINUM: Gaia Offshore & Lyxor/Gaia May Sell Conv. Notes
CERVANTES ORCHARDS: Files Chapter 11 Plan & Disclosure Statement
CHASE FUNDING: Moody's Slashes Class IB Certificate Rating to Ba3
CLEARWATER FUNDING: Moody's Cuts Baa3 $50MM Notes' Rating to B1
COEUR D'ALENE: Expects to Raise $146.8M in Common Stock Offering
COEUR D'ALENE: Earns $9.9 Million in Fourth Quarter of 2005
COLLINS & AIKMAN: Agrees to GE Capital's Tax Payment Request
COLLINS & AIKMAN: Balks at Pressure to Decide on Toyota Lease
CONSTAR INT'L: Lenders Waive Defaults & Alter Financial Covenants
CONSTAR INT'L: Reports $8.8 Million Fourth Quarter Loss
CRI RESOURCES: Court Okays Advanced Insurance as Insurance Expert
CSK AUTO: S&P Puts B+ Corporate Credit Rating on Negative Watch
CURATIVE HEALTH: Files for Chapter 11 Protection in New York
DANA CORP: Ad Hoc Panel Balks at Restricted Stock & Debt Trading
DANA CORP: Pays Sypris $12 Mil. to Continue Postpetition Supply
DELTA AIRLINES: Wants to Walk Away from Delta Stock Option Pact
DELTA AIRLINES: Wants Until May 31 to File Schedules
DELTA AIRLINES: Section 341(a) Meeting Adjourned Sine Die
DIVERSIFIED FIN'L: Sept. 30 Balance Sheet Upside-Down by $2 Mil.
DUO DAIRY: Ch. 7 Trustee Hires Allen & Vellone to Sue Bank Lender
EDDIE BAUER: S&P Downgrades Corporate Credit Rating to B from B+
G+G RETAIL: Court Fixes May 15 as General Claims Bar Date
GENERAL MOTORS: Files 2005 Annual Report with SEC
GOLD KIST: Moody's Holds B2 Rating on $130MM Sr. Unsecured Notes
GREAT CANADIAN: CDN$80 Mil. Equity Plan Cues DBRS to Hold Rating
GRUPO GIGANTE: Fitch Assigns BB Rating to Proposed Senior Notes
HALCO LLC: Case Summary & 20 Largest Unsecured Creditors
HARTWICK COLLEGE: Moody's Holds Ba1 LT Rating with Stable Outlook
IMPERIAL PETROLEUM: Losses & Deficit Prompt Going Concern Doubt
INTERNATIONAL COAL: Earns $31.8 Million for Fiscal Year 2005
IPCS INC: S&P Raises Corp. Credit & Sr. Unsec. Debt Ratings to B-
IWO HOLDINGS: Moody's Lifts Secured Bond Rating to Baa2 from Caa2
KYUNG KIM: Case Summary & 5 Largest Unsecured Creditors
LOVESAC CORP: Can Assume Amended Headquarter Lease Agreement
MASSACHUSETTS HEALTH: Moody's Holds Ba2 Rating on $5 Mil. Bonds
MULTIPLAN INC: Raising $250 Mil. in Proposed Senior Note Offering
MUSICLAND HOLDING: Inks Stipulation on Services Pact with Deluxe
MUSICLAND HOLDING: Gets Final OK on Retail Consulting's Employment
NATIONAL GAS: Files Schedules of Assets and Liabilities
NATIONAL GAS: Bankruptcy Administrator Unable to Appoint Committee
NATIONWIDE HEALTH: Plans to Sell 9 Million Common Shares
NEWAVE INC: Recurring Losses Prompts Going Concern Doubt
NORTEL NETWORKS: OSC Issues Cease Trade Order After Filing Delay
NORTEL NETWORKS: Opens Advanced Mobility Center in Argentina
ON TOP COMMS: Wants to Hire Leo Schaeffler as Financial Consultant
ON TOP COMMS: Wants Until April 19 to Make Lease-Related Decisions
PANTRY INC: 50 Noteholders May Resell Sr. Sub. Convertible Notes
PETSMART INC: Reports $1.05 Bil. Net Sales for 4th Quarter 2005
POPE & TALBOT: S&P Downgrades Sr. Unsecured Debt Rating to CCC+
PREFERRED MOBILE: Case Summary & 20 Largest Unsecured Creditors
PRIMUS TELECOMMS: Raises $5 Million from Private Equity Placement
RECKSON ASSOCIATES: REIT's Free Cash Flow Hits Eight-Year High
REFCO INC: Wants to Sell Refco Japan Shares for $4,600,000
REFCO INC: Wants Court to Okay Miscellaneous Asset Sale Protocol
RESI FINANCE: Moody's Watching & May Upgrade 4 Cert. Class Ratings
RODGER MCAFEE: Case Summary & 4 Largest Unsecured Creditors
SAINT VINCENTS: Settles Dispute with Mallinckrodt
SAINT VINCENTS: GAIC Wants to Conduct Rule 2004 Inquiry
SAKS INC: Posts $2.2MM Net Loss for Quarter Ended Jan. 28, 2006
SEITEL INC: Balance Sheet Upside-Down by $11.2 Million at Dec. 31
SENIOR HOUSING: Former Parent Selling 10.7% Stake for $135.71 Mil.
STARWOOD HOTELS: S&P Affirms BB+ Ratings on $600 Million Sr. Notes
STELCO INC: Gives Update on Finalized and Approved Plan Documents
SYDNEYCO LLC: Case Summary & 2 Largest Unsecured Creditors
TITANIUM METALS: Earns $38.6 Million in Fourth Quarter of 2005
TP&J CORP: Case Summary & 20 Largest Unsecured Creditors
U.S. CAN: Sells U.S. & Argentinean Operations to Ball Corporation
USI HOLDINGS: Fitch Assigns BB- Rating to Loan Credit Facility
USI HOLDINGS: Inks New $285 Million Senior Secured Credit Facility
VENTURE HOLDINGS: Court Okays Pepper Hamilton as Special Counsel
VICORP RESTAURANTS: S&P Lowers Senior Unsecured Debt Rating to B-
WEST BROTHERS : Case Summary & 19 Largest Unsecured Creditors
WICKES INC: Has Until May 24 to Solicit Acceptances of Plan
WORLDSPAN LP: Incurs $3.2 Million Net Loss in Fourth Quarter 2005
* Thacher Proffitt Hires Richard Hans as Litigation Group Partner
* Upcoming Meetings, Conferences and Seminars
*********
ACCO BRANDS: Will Prepay $25 Million of Senior Secured Term Loan
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ACCO Brands Corporation (NYSE:ABD) will prepay $25 million of debt
before the end of the month.
"Our ability to prepay additional debt is a reflection of our
strong cash position," said Neal V. Fenwick, Executive Vice
President and Chief Financial Officer. "We began 2006 with more
than $90 million in cash, allowing us to prepay $24 million of
debt in January and an additional $25 million this month. We now
have greater visibility on the timing of cash restructuring and
integration charges relating to the former ACCO World and General
Binding Corporation office products businesses, and we are
confident that our cash position will remain robust throughout
2006."
Specifically, the company will pay down $25 million of its U.S.
Dollar Senior Secured Term Loan Credit Facility before the end of
the month. After making this payment, the company will have
reduced the principal amount outstanding under its senior secured
credit facilities by $55 million from the $600 million outstanding
at the time they were originated.
"Because our businesses are strong generators of cash, we intend
to increase shareholder value when opportunities present
themselves by improving our balance sheet and making investments
in integration, product innovation and strategic positioning of
our businesses," Mr. Fenwick continued. "We believe that the
opportunity to retire a portion of our debt is an excellent use of
our currently available cash."
About ACCO Brands Corporation
Headquartered in Lincolnshire, Illinois, ACCO Brands Corporation
-- http://www.acco.com/-- is a world leader in branded office
products, with annual revenues of nearly $2 billion. Its
industry-leading brands include Day-Timer(R), Swingline(R),
Kensington(R), Quartet(R), GBC(R), Rexel(R), and Wilson Jones(R),
among others. Under the GBC brand, the company is also a leader in
the professional print finishing market.
* * *
As reported in the Troubled Company Reporter on Feb. 24, 2006,
Standard & Poor's Ratings Services revised its outlook on office
products manufacturer ACCO Brands Corp. to negative from stable.
At the same time, Standard & Poor's affirmed all its outstanding
ratings on the Lincolnshire, Illinois-based company, including its
'BB-' corporate credit rating. Total debt outstanding at
Dec. 31, 2005, was about $942 million.
The outlook revision follows ACCO's weaker-than-expected operating
performance for its fiscal year ended December 2005 and its
revised guidance for fiscal 2006.
ACURA PHARMA: Secures $750K Bridge Funding for Product Development
------------------------------------------------------------------
Acura Pharmaceuticals, Inc. (OTCBB:ACUR) secured gross proceeds of
$750,000 under a term loan agreement with:
* Essex Woodlands Health Ventures V, L.P.,
* Care Capital Investments II, L.P.,
* Care Capital Offshore Investments II, L.P.,
* Galen Partners III, L.P.,
* Galen Partners International III, L.P. and
* Galen Employee Fund III, L.P.
The Loan matures on June 1, 2006, bears an annual interest rate of
10%, is secured by a lien on all assets of the Company and its
subsidiary, and is senior to all other Company debt.
The Company will use utilize the net proceeds from the Loan to
continue funding product development and licensing activities
relating to OxyADF(TM) tablets and other product candidates
utilizing its Aversion(R) Technology. The Loan permits the
funding of additional cash amounts subject to agreement by the
Company and the Bridge Lenders. No assurance can be given,
however, that any additional funding will be advanced to the
Company under the terms of the Loan.
Cash Reserves Update
The Company estimates that its current cash reserves, including
the net proceeds from the Loan, will fund product development and
licensing activities through mid-May, 2006. To continue operating
thereafter, the Company must raise additional financing or enter
into appropriate collaboration agreements with third parties
providing for cash payments to the Company. No assurance can be
given that the Company will be successful in obtaining any such
financing or in securing collaborative agreements with third
parties on acceptable terms, if at all, or if secured, that such
financing or collaborative agreements will provide for payments to
the Company sufficient to continue funding operations. In the
absence of such financing or third-party collaborative agreements,
the Company will be required to scale back or terminate operations
and/or seek protection under applicable bankruptcy laws.
About Acura Pharmaceuticals
Headquartered in Palatine, Illinois, Acura Pharmaceuticals, Inc.
-- http://www.acurapharm.com/-- is a specialty pharmaceutical
company engaged in research, development and manufacture of
innovative and proprietary abuse deterrent, abuse resistant and
tamper resistant formulations intended for use in orally
administered opioid-containing prescription analgesic products.
Acura is actively collaborating with contract research
organizations for laboratory and clinical evaluation and testing
of product candidates formulated with its Aversion(R) Technology.
* * *
Continuing Losses
As reported in the Troubled Company Reporter on Mar. 1, 2006,
Acura Pharmaceuticals, Inc., incurred a net loss of $7.1 million
for the quarter ending Dec. 31, 2005, compared to a net loss of
$2.1 million for the same period in 2004.
Balance Sheet Insolvency
Acura's balance sheet dated Dec. 31, 2005, shows $1,792,000 in
assets. Acura's liabilities exceed that asset base by $6,162,000.
Bankruptcy Warning
In the absence of new financing or third-party collaborative
agreements, Acura has said in regulatory filings, the Company
believes that it will be required to scale back or terminate
operations or seek protection under applicable bankruptcy laws.
ADVANSTAR COMM: Moody's Puts B2 Rating on Proposed $75 Mil. Loan
----------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to Advanstar
Communications' Inc.'s proposed $75 million senior secured first
lien revolving credit facility and affirmed all other ratings. The
rating outlook is changed to stable from developing.
Rating assigned:
* $75 million restated and amended senior secured first
lien revolving credit facility, due 2009 -- B2
Ratings affirmed:
* $291 million of 10.75% second lien secured notes,
due 2010 -- B3
* $160 million of 12% senior subordinated notes,
due 2011-- Caa2
* Corporate Family Rating -- B3
Ratings Withdrawn:
* $60 million senior secured revolving credit facility,
due 2007 -- B2
The rating outlook is changed to stable from developing.
The ratings reflect Advanstar's high leverage, its negative free
cash flow generation, management's continuing acquisitiveness and
the vulnerability of its debtholders to the cross default
provisions of its parent's debt.
The change in rating outlook to stable largely reflects the
company's decision that it will continue to invest in the growth
of its business and execute its current strategy, while currently
refraining from pursuing a sale of the business.
Ratings recognize the predictability of Advanstar's sales, and the
growth prospects presented by recent acquisitions and new product
launches. However, Moody's estimates that free cash flow will
continue to be negative due to the increase in cash interest
expense, as the 15% holdco notes turn cash pay in April 2006.
The company's debt covenants are cross defaulted to those of its
parent's -- Advanstar Inc. -- unrated discount notes. Advanstar
Inc., relies upon dividends from Advanstar Communications in order
to service its interest expense. However, the restricted payments
provisions under Advanstar Communications' debt preclude dividends
if debt to EBITDA exceeds 6.0 times, or if its restricted payments
basket is depleted.
At the end of December 2005, Moody's estimates that Advanstar
reported total debt of approximately $635 million, or about 8.7
times consolidated EBITDA. After employing Moody's global
standard adjustments, leverage is estimated at 8.3 times.
The B2 rating on the proposed $75 million senior secured first
lien revolving credit facility reflects the facility's seniority
to approximately $619 million in junior ranked consolidated debt.
Management has indicated that, when finalized, the amended and
restated credit agreement will eliminate the current 1.0:1 fixed
charge maintenance test and replace it with a new 6.0:1 leverage
incurrence test. Moody's ratings are subject to a review of final
documentation.
Headquartered in New York City, Advanstar Communications, Inc., is
a leading provider of integrated marketing solutions for the
Fashion, Life Sciences and Powersports industries. For fiscal
2005, the company recorded sales of $289 million.
AEARO TECHS: S&P Puts B Corp. Credit Rating with Stable Outlook
---------------------------------------------------------------
Standard & Poor's Ratings Services removed its ratings on safety
equipment manufacturer Aearo Corp. (B+/Watch Neg/--) from
CreditWatch with negative implications, where they were placed
Feb. 2, 2006. The action follows Aearo's acquisition on March 24
by private equity sponsor Permira Funds from Bear Stearns Merchant
Banking for $765 million.
Following the transaction, Standard & Poor's assigned its 'B'
corporate credit rating to the parent company, Aearo Technologies
Inc., which wholly owns Aearo Corp. Meanwhile, the ratings on the
subsidiary, Aearo Corp., including:
* the corporate credit rating,
* the revolving credit facility rating,
* the term loan rating, and
* the senior subordinated note rating,
have been withdrawn.
The issues were redeemed with the proceeds from new financing by
Aearo Technologies, including:
-- a $60 million, six-year, first-lien revolving credit
facility; and
-- a $360 million, seven-year senior secured (first-lien) term
loan B.
The ratings on these new issues are rated 'B', with a '2' recovery
rating, indicating Standard & Poor's expectation of substantial
recovery of principal in the event of a default (80%-100%).
Aearo also issued a $150 million, 7.5-year senior secured (second-
lien) term loan that has been assigned a 'CCC+' rating and a '5'
recovery rating, indicating Standard & Poor's expectation that the
debtholders would recover a negligible amount of principal (0-25%)
in the event of default, only after the first-lien holdings were
recovered.
The outlook on Aearo Technologies is stable.
Indianapolis, Indiana-based Aearo is a leader in the:
* hearing,
* eye,
* face,
* head, and
* respiratory areas
of the personal-protection equipment market, segments representing
about $3 billion of the $15 billion global safety equipment
industry.
The company had sales of $430 million for the 12 months ended
December 2005. It manufactures and sells safety products in more
than 70 countries under well-known brand names. It also makes a
wide array of energy-absorbing materials incorporated into other
manufacturers' products to control noise, vibration, and shock.
"The ratings on Aearo Technologies reflects its weak business risk
profile in a fragmented industry, its heavy debt burden, and its
aggressive financial policy," said Standard & Poor's credit
analyst John R. Sico. "However, the company holds good niche
positions within this large industry. Though the business is
highly fragmented, Aearo maintains good geographic, product, and
customer diversity; has stable earnings; and generates relatively
good free cash flow."
Despite the competitive nature of the industry, Aearo has been
able to stabilize earnings and generate positive free cash flow
because it produces good margins and benefits from limited working
and fixed-capital needs, advantages that reduce its exposure to
business cyclicality. Furthermore, a significant portion of its
revenues stem from consumable products. Aearo also benefits from
stable demand because of government and industry regulations
requiring safety equipment.
Part of the demand for the company's products is tied to
manufacturing employment, which has been flat, especially in the
U.S.; however, the company also sells through the consumer,
construction, and military markets. The economy is currently
improving, and Aearo's sales in the fiscal year ended September
2005 rose more than 15% from the year earlier, almost entirely
from internal growth.
ALLIANCE ATLANTIS: Earns $24.8 Million in Fourth Quarter of 2005
----------------------------------------------------------------
Alliance Atlantis Communications Inc., reported $84.2 million in
broadcasting revenue for the fourth quarter of 2005, an increase
of 16% compared to the same period last year.
For the full year 2005, Alliance Atlantis recorded broadcasting
revenue of $283.4 million representing an increase of 15% over the
prior year driven by gains in advertising and subscriber revenue.
The Company's operating earnings for the quarter were $40.5
million compared to an operating loss of $10.4 million for the
prior year's period, while for the full year, its operating
earnings were $124.2 million compared to $9.8 million of the prior
year.
For the quarter, the Company's net earnings were $24.8 million
compared to net earnings of $9.6 million for the prior year's
period. The increase, the Company notes, reflects a $1.4 million
foreign exchange loss during the current quarter compared to a
$15.8 million gain in the same period last year.
According to the Company, the losses in the current year are
primarily unrealized and are related to the long-term investment
in foreign operations held by its Motion Picture Distribution
business, partly offset by unrealized gains as a result of the
unhedged portion on its long-term U.S. dollar denominated debt.
The Company's net earnings for the year were $70.9 million
compared to $29.7 million last year. The increase reflects an
$8.1 million foreign exchange loss in the current year compared to
a $22.4 million gain in the prior year, the Company says.
Liquidity
The Company's free cash flow for the fourth quarter and full year
2005 were $63.6 million and $120.1 million, respectively compared
to $32.7 million and an outflow of $23.1 million in the same
periods in the prior year, respectively.
In addition, the Company's consolidated net debt decreased from
the prior year by $96.7 million to $331.9 million. The decrease,
according to the Company, is a result of improvements in free cash
flow as well as the positive impact of the strengthening Canadian
dollar on its U.S. dollar denominated debt.
The Company's net debt, excluding non-recourse net debt related to
Motion Picture Distribution LP, was $290.6 million, representing a
reduction of $126.7 million from the prior year's period, or a
reduction of $143.8 million excluding cash used to repurchase
stock.
About Alliance Atlantis Communications
Based in Toronto, Ontario, Alliance Atlantis Communications Inc.
-- http://www.allianceatlantis.com/-- offers Canadians 13 well-
branded specialty channels boasting targeted, high-quality
programming. The Company also co-produces and distributes the hit
CSI franchise and indirectly holds a 51% limited partnership
interest in Motion Picture Distribution LP, a leading distributor
of motion pictures in Canada, with a growing presence in motion
picture distribution in the United Kingdom and Spain. The
Company's common shares are listed on the Toronto Stock Exchange-
trading symbols AAC.A and AAC.NV.B.
* * *
On March 26, 2004, Moody's placed Alliance Atlantis' debt and
corporate family ratings at Ba2 with positive outlook.
With stable outlook, Standard & Poor's upgraded the Company's
long-term foreign and local issuer credit ratings to BB from BB-.
The ratings were placed on Oct. 28, 2004.
ALLIED HOLDINGS: Court Approves Haymaker/Bean as Broker
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Georgia
authorized Allied Holdings, Inc., and its debtor-affiliates to
employ Haymaker Company, LLC, dba Haymaker/Bean Commercial Real
Estate, as their exclusive broker, nunc pro tunc to Jan. 24, 2006.
As reported in the Troubled Company Reporter on Feb. 15, 2006, the
Debtors hired Haymaker/Bean to market the property owned by Allied
Systems, Ltd., located at 239 Triport Road in the City of
Georgetown, County of Scott, Kentucky.
Haymaker will market and list the Property for sale at $665,000.
The firm is entitled to a 7% commission of the gross sale price of
the Property.
Headquartered in Decatur, Georgia, Allied Holdings, Inc. --
http://www.alliedholdings.com/-- and its affiliates provide
short-haul services for original equipment manufacturers and
provide logistical services. The Company and 22 of its affiliates
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.
Case Nos. 05-12515 through 05-12537). Jeffrey W. Kelley, Esq., at
Troutman Sanders, LLP, represents the Debtors in their
restructuring efforts. Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor. Anthony J. Smits,
Esq., at Bingham McCutchen LLP, provides the Official Committee of
Unsecured Creditors with legal advice and Russell A. Belinsky at
Chanin Capital Partners, LLC, provides financial advisory services
to the Committee. When the Debtors filed for protection from
their creditors, they estimated more than $100 million in assets
and debts. (Allied Holdings Bankruptcy News, Issue No. 18;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
ALLIED HOLDINGS: Court Approves DaimlerChrysler Contract
--------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Georgia
approved Allied Holdings, Inc., and its debtor-affiliates' Motor
Carrier Transportation Contract with DaimlerChrysler Corporation.
As reported in the Troubled Company Reporter on March 6, 2006,
Allied Systems and DaimlerChrysler entered into a Carrier
Transportation Agreement on Dec. 16, 2005. Pursuant to the
Agreement, Allied Systems provides delivery and transportation
services to DaimlerChrysler in the U.S. and Canada, and
DaimlerChrysler pays Allied Systems according to specific rate
terms.
The Agreement, effective Oct. 1, 2005, provides Allied Systems
with increased rates for 2005 and 2006 and maintains the current
fuel surcharge relief.
Headquartered in Decatur, Georgia, Allied Holdings, Inc. --
http://www.alliedholdings.com/-- and its affiliates provide
short-haul services for original equipment manufacturers and
provide logistical services. The Company and 22 of its affiliates
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.
Case Nos. 05-12515 through 05-12537). Jeffrey W. Kelley, Esq., at
Troutman Sanders, LLP, represents the Debtors in their
restructuring efforts. Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor. Anthony J. Smits,
Esq., at Bingham McCutchen LLP, provides the Official Committee of
Unsecured Creditors with legal advice and Russell A. Belinsky at
Chanin Capital Partners, LLC, provides financial advisory services
to the Committee. When the Debtors filed for protection from
their creditors, they estimated more than $100 million in assets
and debts. (Allied Holdings Bankruptcy News, Issue No. 18;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
AMCAST INDUSTRIAL: Panel Has Until April 1 to Contest Bank's Liens
------------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Amcast
Industrial Corporation and Amcast Automotive of Indiana, Inc.'s
bankruptcy cases, has until April 1, 2006, to challenge the
prepetition liens asserted by NexBank, SSB.
NexBank asserts a security interest in and liens upon
substantially all of the Debtors' assets on account of prepetition
loans totaling approximately $82.6 million.
Pursuant to the Final Order allowing the Debtors to use NexBank's
cash collateral, the Hon. Frank J. Otte of the U.S. Bankruptcy
Court for the Southern District of Indiana in Indianapolis allowed
any interested party -- excluding any of the Debtors -- to object
to the validity and extent of NexBank's liens.
Cash Collateral Use
In December 2005, the Bankruptcy Court gave its final consent for
the Debtors' limited use of cash collateral securing repayment of
their debts to NexBank.
As adequate protection for the use of its cash collateral, the
Debtors grant NexBank replacement security interests in, and liens
equal to the diminution in the value of the prepetition collateral
resulting from the Debtors use of the cash collateral from the
Petition Date.
As additional adequate protection to NexBank, the Debtors agree
to:
a) make adequate protection payments equal to regularly
scheduled interest payments at the contractual, non-
default rate due under the prepetition credit agreement;
b) use unencumbered cash, if any, prior to the using cash
collateral and continue to segregate and account for the
cash collateral and its proceeds; and
c) remit directly to NexBank any future payments received on
account of prepetition receivables after providing written
notice to the Committee.
The Debtors are allowed to use Cash Collateral in accordance with
a weekly budget. A copy of the latest budget submitted by the
Debtors is available for free at:
http://researcharchives.com/t/s?70b
About Amcast
Headquartered in Fremont, Indiana, Amcast Industrial Corporation,
manufactures and distributes technology-intensive metal products
to end-users and suppliers in the automotive and plumbing
industry. The Company and four debtor-affiliates filed for
chapter 11 protection on Nov. 30, 2004. The U.S. Bankruptcy Court
for the Southern District of Ohio confirmed the Debtors' Third
Amended Joint Plan of Reorganization on July 29, 2005. The
Debtors emerged from bankruptcy on Aug. 4, 2005.
Amcast Industrial Corporation and Amcast Automotive of Indiana,
Inc., filed for chapter 11 protection a second time on Dec. 1,
2005 (Bankr. S.D. Ind. Case No. 05-33323). David H. Kleiman, Esq.,
and James P. Moloy, Esq., at Dann Pecar Newman & Kleiman, P.C.,
represent the Debtors in their restructuring efforts. When the
Debtor and its affiliate filed for protection from their
creditors, they listed total assets of $97,780,231 and total
liabilities of $100,620,855.
Amcast Industrial's chapter 11 case is jointly administered with
Amcast Automotive of Indiana, Inc.'s chapter 11 proceeding.
ANCHOR GLASS: Inks Amended Agreement with General Chemical
----------------------------------------------------------
Anchor Glass Container Corporation and General Chemical Industrial
Products are parties to an agreement wherein Anchor Glass
purchases bulk dense soda ash from General Chemical.
According to Anchor Glass, General Chemical is an important
supplier. Anchor Glass has not yet rejected the Agreement and
continues to purchase soda ash from General Chemical.
General Chemical has a prepetition claim for $35,553, net of any
setoffs, credits or discounts.
As part of the Debtor's reorganization process, Anchor Glass and
General Chemical agreed to compromise the prepetition claim and
enter into an Amended Agreement.
Pursuant to the Amended Agreement, Anchor Glass will pay $24,908
to General Chemical in full satisfaction of the claim. The
parties also agreed to extend the term of the Amended Agreement
until December 31, 2006.
Accordingly, the Debtor asks the U.S. Bankruptcy Court for the
Middle District of Florida to approve the Amended Agreement and
authorize it to assume the Contract.
Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is the third-largest manufacturer of glass containers
in the United States. Anchor manufactures a diverse line of flint
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets. The Company filed for chapter 11 protection on Aug. 8,
2005 (Bankr. M.D. Fla. Case No. 05-15606). Robert A. Soriano,
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts. Edward J. Peterson, III, Esq., at
Bracewell & Guiliani, represents the Official Committee of
Unsecured Creditors. When the Debtor filed for protection from
its creditors, it listed $661.5 million in assets and $666.6
million in debts. (Anchor Glass Bankruptcy News, Issue No. 21;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
ANCHOR GLASS: Court Directs Officers to File Statements
-------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida
requires Anchor Glass Container Corporation's officers to file:
-- a statement describing the property;
-- a statement of the unpaid principal due, accrued interest,
all late charges, attorney's fees, advances for taxes and
insurance, all unearned interest, any other charges, and
the per diem interest factor; and
-- a statement detailing what the Officers believe is adequate
protection in connection with their request.
The Court directs the Officers to advise it as to how the value
of their claim will be determined, either by appraisal, blue book
value or expert testimony.
As reported in the Troubled Company Reporter on March 8, 2006,
Joel Asen, Darrin Campbell, James Chapman, Richard Deneau,
Jonathan Gallen, George Hamilton, Timothy Price, Peter Reno, Alan
Schumacher, and Lenard Tessler seek access to, and the benefit of,
certain insurance policies that were purchased to protect them
against certain costs and liabilities arising from their services
as directors and officers of the Debtor.
Responses
1. Anchor Glass Container Corporation
Robert A. Soriano, Esq., at Carlton Fields PA, in Tampa, Florida,
notes that the Officers are requesting for a comfort order because
the automatic stay does not apply to their claims.
Mr. Soriano contends that if there is no controversy, the
Officers' request should be denied without prejudice for failing
to raise a justifiable issue.
To the extent the Motion seeks indemnification from the Debtor,
Mr. Soriano says it should be denied because:
-- the Officers' indemnification claims arose prepetition;
-- the indemnification provides no benefit to the estate; and
-- any indemnification claims of the Officers do not give rise
to administrative claims entitled to payment postpetition.
According to Mr. Soriano, the Officers did not indicate the
amounts to be reimbursed, thus, the Debtor can't address the
issue.
2. Ad Hoc Committee of 11% Senior Secured Noteholders
While the Ad Hoc Committee of 11% Senior Secured Noteholders
believes that certain of the D&O Policy proceeds are estate
property, it does not oppose the Officers' request.
The Ad Hoc Committee wants appropriate supervision over the
payment of the Officers' defense costs to avoid unnecessary
depletion of estate assets.
$510,666 in Defense Costs Sought
The Officers note that their request concerns their rights under
the D&O Policies and their entitlement to the proceeds of the D&O
Policies, rather than tangible property of the Debtor.
Accordingly, the Officers do not believe that the Court's
direction to submit financial and valuation-related information
is applicable.
Nevertheless, the Officers provide the Court with these relevant
information:
* The limits of liability of the D&O Policies are $10,000,000
each on the National Union primary policy, the XL Specialty
Insurance, Ltd., excess policy and the Houston Casualty Co.
excess policy; and
* The outstanding defense costs due and owing under the Policy
as of January 31, 2006, total $510,666, and continue to
accrue.
Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is the third-largest manufacturer of glass containers
in the United States. Anchor manufactures a diverse line of flint
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets. The Company filed for chapter 11 protection on Aug. 8,
2005 (Bankr. M.D. Fla. Case No. 05-15606). Robert A. Soriano,
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts. Edward J. Peterson, III, Esq., at
Bracewell & Guiliani, represents the Official Committee of
Unsecured Creditors. When the Debtor filed for protection from
its creditors, it listed $661.5 million in assets and $666.6
million in debts. (Anchor Glass Bankruptcy News, Issue No. 21;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
ANDREW CORP: S&P Affirms BB Rating & Revises Outlook to Positive
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Westchester, Illinois-based Andrew Corp. to positive from stable.
Ratings on the company, including the 'BB' corporate credit
rating, were affirmed.
"Ratings continue to reflect the highly competitive and cyclical
spending environment of the wireless and cable television
industries in which Andrew Corp. operates, as well as its
acquisitive growth strategy," noted Standard & Poor's credit
analyst Bruce Hyman. "This is partly offset by a solid financial
profile for the rating, and Andrew's strong market position in
wireless infrastructure components. The revised outlook
recognizes the company's improving profitability trend, which
could lead to higher ratings in the next year."
Andrew's financial profile remains relatively strong for the
rating level. Debt to EBITDA, adjusted for operating leases, is
about 2.0x. Based on management's expected balanced acquisition
funding strategy, Standard & Poor's expects debt leverage metrics
to continue to be good.
AQUA SOCIETY: December 31 Balance Sheet Upside-Down by $664,547
---------------------------------------------------------------
Aqua Society, Inc., reported its financial results for the quarter
ended Dec. 31, 2005, to the Securities and Exchange Commission on
March 20, 2006.
For the three months ended Dec. 31, 2005, Aqua Society incurred a
$1,125,302 net loss on $782,242 of total revenues. For the three
months ended Sept. 30, 2005, the Company incurred a $23,060,681
net loss. The Company did report any revenues for the quarter
ended Sept. 30, 2005.
For the quarter ended Dec. 31, 2005, the Company has $182,118 of
cash and a $884,712 negative working capital balance.
At Dec. 31, 2005, Aqua Society's balance sheet showed $1,671,854
in total assets and $2,336,401 in total liabilities. The Company
reports a $27,175,056 accumulated deficit at Dec. 31, 2005.
Going Concern Doubt
Amisano Hanson expressed substantial doubt about Aqua Society's
ability to continue as a going concern after auditing the
Company's financial statements for the years ended September 30,
2005 and 2004. The auditing firm pointed to the Company's
uncertainty in raising capital from stockholders or other sources
to sustain operations and uncertainty in obtaining necessary
financing to meet its obligations and repay its liabilities
arising from normal business operations when they come due.
A full-text copy of Aqua Society's latest quarterly report is
available for free at http://ResearchArchives.com/t/s?706
Headquartered in Herten, Germany, Aqua Society, Inc., is involved
in designing and developing applied technologies and providing
consulting services in the areas of heating, ventilation, air
conditioning, refrigeration, water purification, waste water
treatment and energy.
As of Dec. 31, 2005, Aqua Society's balance sheet shows a $664,547
stockholders' equity deficit, smaller than the $1,453,074 equity
deficit reported at Sept. 30, 2005.
ATA AIRLINES: Keycorp Leasing Wants $1.6 Million Admin. Claim Paid
------------------------------------------------------------------
KeyCorp Leasing, n.k.a. Key Equipment Finance Inc., and ATA
Airlines, Inc., are parties to lease agreements relating to six
Rolls Royce RB211-524B4 engines, including Lease Agreement 14767
dated as of December 20, 1999, pursuant to which Rolls Royce
engine serial number 14767 was leased for a term ending on
December 31, 2006.
Michael A. Axel at KeyBank National Association relates that ATA
rejected Lease 14767 effective November 4, 2005. Key did not
immediately retrieve Engine 14767, and ATA thereafter indicated to
Key that it wanted to retain Engine 14767 despite the rejection.
Mr. Axel notes that Engine 14767 was left at the ATA property in
an open area otherwise unused by ATA. ATA also listed Lease 14767
as a lease the reorganizing Debtors intended to assume under the
Plan.
Mr. Axel tells the U.S. Bankruptcy Court for the Southern District
of Indiana that ATA used Engine 14767 to fly its aircraft
throughout the Chapter 11 reorganization case until the engine was
damaged and was rendered unserviceable in May 2005.
From the damage date through the rejection date, Engine 14767
remained on the ground at ATA (with some of its parts apparently
removed for use on other ATA engines when needed to maintain
them). ATA continued to pay monthly rent to Key through October
2005, but never paid the rent due for November and December 2004
despite its use of Engine 14767 during that period, Mr. Axel says.
Thus, Key asserts an administrative expense claim for $30,750 for
each of those two months.
According to Mr. Axel, ATA did not comply with the maintenance and
parts replacement terms of Lease 14767, and the Engine is
currently not operable or airworthy.
ATA rejected Lease 14767 without conducting the repairs and
servicing necessary to place the Engine into the return condition
required by the Lease, or even to render it airworthy.
Key estimates the cost of repairing Engine 14767 is approximately
$1,582,400. That amount, Mr. Axel says, includes $1,275,000
needed to cure maintenance and repair defaults ATA breached since
May 2005, and $307,400 needed to meet additional return condition
requirements under Lease 14767.
By this motion, Key asks the Court to award and direct payment of
an administrative expense for Key Engine Lease 14767 totaling
$1,643,900, plus attorneys' and consultants' fees and expenses.
About ATA Airlines
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. Daniel H.
Golden, Esq., Lisa G. Beckerman, Esq., and John S. Strickland,
Esq., at Akin Gump Strauss Hauer & Feld, LLP, represents the
Official Committee of Unsecured Creditors. 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. 50; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
ATA AIRLINES: Names Josef Loew as Scheduled Service Senior VP
-------------------------------------------------------------
ATA Airlines, Inc., appointed Josef Loew to the position of Senior
Vice President - Scheduled Service. This appointment completes a
leadership structure realignment that was initiated in January in
order to drive accountability down to each of ATA's two lines of
business - Military/Charter and Scheduled Service. Loew will
report directly to the COO and will have responsibility for the
Company's Marketing and Market Planning functions as well as
Inflight, Reservations, Station Operations, Cargo, and Corporate
Communications.
"During a more than 14-year career, Loew has distinguished himself
as a leader in new product development, revenue generation and
change management," said John Denison, Chairman, CEO, and
President. "As the newest member of our talented Senior
Leadership Team, he will apply his abilities toward refining ATA's
business strategy to reach maximum profitability."
Loew comes to ATA from SITA INC Canada Inc., a leading provider of
IT business solutions and communications services to the air
transport community. As Head of Product, Loew drove the
development and marketing strategy for the company's highly
successful Airline Pricing and Fares Management business unit.
Loew joined SITA upon its acquisition of SMG Technologies, where
as Partner and Senior Vice President of Marketing and Business
Development he oversaw worldwide marketing for SMG's airline
pricing systems and consulting services.
Loew has fulfilled key positions involving carriers in the United
States and Canada, including as Vice President for Revenue
Management at America West Airlines. His roles have included the
areas of Revenue Management, Pricing, Corporate Strategy,
Scheduling and Distribution, Marketing, and Finance. After more
than ten years sharpening his skills in these areas, Loew applied
his talents at priceline.com where he played a pivotal role in
developing the company's entry strategy that launched its European
Air Travel Product.
Loew joins ATA effective immediately. He holds a bachelor of
science in Applied Physics from Fachhochschule in Munich, Germany
and a master of business administration in finance from the
University of Calgary in Alberta, Canada.
About ATA Airlines
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. Daniel H.
Golden, Esq., Lisa G. Beckerman, Esq., and John S. Strickland,
Esq., at Akin Gump Strauss Hauer & Feld, LLP, represents the
Official Committee of Unsecured Creditors. 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. 50; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
ATLAS PIPELINE: Reports $10.9 Mil. of Net Income in 4th Quarter
---------------------------------------------------------------
Atlas Pipeline Partners, L.P., reported record earnings before
interest, taxes, depreciation and amortization, a non-GAAP
measure, of $21.3 million for the fourth quarter 2005 compared
with $14.5 million for the same period in 2004.
For the fourth quarter 2005, Atlas Pipeline's net income was
$10.9 million compared with $11.1 million for the fourth quarter
of 2004.
The Company's general and administrative expenses, including
amounts reimbursed to affiliates, increased $2.7 million to $4.5
million for the fourth quarter 2005 from $1.8 million for the
fourth quarter 2004.
The increase, according to the Company, was primarily related
to general and administrative expenses associated with the
operations of the acquired assets in the Mid-Continent region and
a $1.5 million increase in non-cash compensation expense related
to vesting of incentive awards.
In addition, the Company's depreciation and amortization increased
$3.1 million to $5.5 million for the fourth quarter 2005 due
principally to the depreciation and amortization of the assets
acquired.
For the quarter, the Company's interest expense also increased to
$5.7 million, an increase of $4.6 million from the prior year
fourth quarter. The increase, the Company notes, was primarily
related to interest associated with the borrowings under the
credit facility used to finance the acquired assets. At Dec. 31,
2005, the Company has $9.5 million of outstanding borrowings under
the credit facility as the majority of the borrowings associated
with the acquired assets were repaid with the net proceeds from
its November 2005 equity offering and December 2005 issuance of
$250.0 million of senior unsecured notes.
About Atlas Pipeline Partners
Headquartered in Moon Township, Pennsylvania, Atlas Pipeline
Partners, L.P. -- http://www.atlaspipelinepartners.com/-- is
active in the transmission, gathering and processing segments of
the midstream natural gas industry. In the Mid-Continent region
of Oklahoma, Arkansas, northern Texas and the Texas panhandle, the
Partnership owns and operates approximately 2,565 miles of
intrastate gas gathering pipeline and a 565-mile interstate
natural gas pipeline. The Partnership also operates two gas
processing plants and a treating facility in Velma, Elk City and
Prentiss, Oklahoma where natural gas liquids and impurities are
removed. In Appalachia, it owns and operates approximately 1,500
miles of natural gas gathering pipelines in western Pennsylvania,
western New York and eastern Ohio.
Atlas America, Inc. -- http://www.atlasamerica.com/-- the parent
company of Atlas Pipeline Partners, L.P.'s general partner and
owner of 1,641,026 units of limited partner interest of APL, is an
energy company engaged primarily in the development and production
of natural gas in the Appalachian Basin for its own account and
for its investors through the offering of tax advantaged
investment programs.
* * *
Moody's assigned Atlas Pipeline's unsecured debt and family
ratings at B1, while Standard & Poor's rated the Company's long-
term local and foreign issuer credits at BB-. Moody's assigned
these ratings on Dec. 6, 2005, and said the outlook is stable.
AUTONATION INC: Receives Required Consents for 9% Senior Notes
--------------------------------------------------------------
AutoNation, Inc. (NYSE: AN) received, as of 5:00 p.m., New York
City time, on March 24, 2006, tenders and consents from holders
of more than 95% of its outstanding 9% Senior Notes due 2008 in
connection with its cash tender offer and consent solicitation
for the Notes. The number of consents received substantially
exceeded the number needed to approve the adoption of the proposed
amendments to the indenture under which the Notes were issued.
The terms of the tender offer and consent solicitation for the
Notes can be sourced from the dealer managers.
Based on the consents received, AutoNation is expected to execute
as soon as practicable a supplemental indenture that will, once
operative, eliminate most of the restrictive covenants and events
of default in the indenture and the Notes. The supplemental
indenture will not become operative unless and until Notes are
accepted for purchase by AutoNation pursuant to the tender
offer.
AutoNation's offer to purchase the Notes is subject to the
satisfaction or waiver of various conditions as described in
the Offer to Purchase, including a financing condition. Notes
may be tendered pursuant to the tender offer until 10:00 a.m.,
New York City time, on April 12, 2006, or such later date and
time to which the Offer Expiration Date is extended by AutoNation.
Holders who validly tender Notes after 5:00 p.m., New York City
time, on March 24, 2006 but prior to the Offer Expiration Date
will not receive the consent payment of $30 per $1,000 principal
amount of Notes tendered.
The dealer managers for the tender offer and consent solicitation
are:
J.P. Morgan Securities Inc.
Telephone (212) 270-7407 (collect)
-- and --
Wachovia Securities
Telephone (704) 715-8341 (collect)
Requests for documents may be directed to the Information Agent:
Innisfree M&A Incorporated
Telephone (212) 750-5833 (collect)
Toll-free (877) 825-8631
Headquartered in Fort Lauderdale, Florida, AutoNation, Inc. --
http://www.autonation.com-- is America's largest automotive
retailer and a component of the Standard and Poor's 500 Index.
AutoNation has approximately 27,000 full-time employees and owns
and operates 346 new vehicle franchises in 17 states.
* * *
As reported in the Troubled Company Reporter on Mar. 9, 2006,
Fitch downgraded AutoNation, Inc.'s ratings:
-- Issuer Default Rating to 'BB+' from 'BBB-'
-- $600 million bank credit facility to 'BB+' from 'BBB-'
-- Senior unsecured notes to 'BB+' from 'BBB-'
Fitch also expects to rate AutoNation's new senior unsecured notes
and Term Loan A 'BB+'. Fitch said the Rating Outlook is Negative.
BALL CORP: Completes Acquisition of U.S. Can's Two Operations
-------------------------------------------------------------
Ball Corporation (NYSE: BLL) completed its acquisition of the
United States and Argentinean operations of U.S. Can Corporation,
adding to Ball's portfolio of packaging products and making Ball
the largest supplier in the U.S. of aerosol cans, primarily for
food and household products.
Ball acquired 10 manufacturing plants in seven states and two
plants in Argentina. The operations have sales of approximately
$600 million, employ 2,300 people and produce more than two
billion steel aerosol containers annually. In addition to aerosol
cans, the acquired operations produce paint cans, plastic
containers and custom and specialty cans.
Ball reported early this month that it had hired can industry
veteran Michael W. Feldser to head up the acquired U.S. Can
operations. He will be president of Ball's aerosol & specialty
packaging division.
"We are pleased to have this acquisition closed so the integration
process can begin," said R. David Hoover, president and chief
executive officer. "We have a track record for successful
integration of acquired businesses, and we intend to build on that
record."
Ball reported that the former U.S. Can headquarters in a leased
building in Lombard, Illinois, will be closed. Functions that had
been performed there will be transferred to Ball offices near
Denver, moved to a plant in Elgin, Illinois, that is part of the
acquisition or in certain cases eliminated. The number of U.S.
Can employees who will receive employment opportunities with Ball
will be determined in the coming weeks, based upon anticipated
needs, interest in relocation and other factors as the integration
process continues.
"We will implement plans to welcome new employees, meet with
customers and suppliers and begin to realize the synergy savings
we are certain exist and to identify others," Mr. Hoover said.
"We expect to realize consolidation opportunities in the future as
we fully integrate the people and plants into Ball. Closing the
former headquarters is a first step and should help facilitate the
integration process. We believe this is a business that will
benefit considerably from being a part of a larger packaging
organization, and that our existing packaging businesses will
benefit from having them as part of Ball."
Raymond J. Seabrook, senior vice president and chief financial
officer, said the refinancing of the U.S. Can debt was
accomplished at significantly lower rates through the issue by
Ball of a new series of senior notes and an increase in bank debt
under new facilities that were put in place in the fourth quarter
of 2005.
About U.S. Can Corp.
Headquartered in Lombard, Illinois, U.S. Can Corporation --
http://www.uscanco.com/-- manufactures steel containers for
personal care, household, automotive, paint and industrial
products in the United States and Europe, as well as plastic
containers in the United States and food cans in Europe.
At Oct. 2, 2005, U.S. Can's balance sheet showed a $426,657,000
equity deficit, compared to a $398,429,000 deficit at Dec. 31,
2004.
About Ball Corp.
Headquartered in Broomfield, Colorado, Ball Corporation --
http://www.ball.com/-- is a supplier of high-quality metal and
plastic packaging products and owns Ball Aerospace & Technologies
Corp., which develops sensors, spacecraft, systems and components
for government and commercial customers. Ball reported 2005 sales
of $5.7 billion and the company employs 13,100 people worldwide.
* * *
As reported in the Troubled Company Reporter on Mar. 6, 2006,
Moody's Investors Service assigned ratings to Ball Corporation's
proposed $500 million senior secured term loan D, rated Ba1, and
proposed $450 million senior unsecured notes due 2016-2018, rated
Ba2.
Moody's also affirmed existing ratings, which include Ba1 ratings
on $1.475 billion senior secured credit facilities and
$550 million senior unsecured notes due Dec. 12, 2012. The
ratings outlook is stable. The ratings are subject to review of
final documentation.
As reported in the Troubled Company Reporter on Mar. 2, 2006,
Fitch Ball Corporation (NYSE: BLL) said Ball Corporation's
recently announced acquisitions will not affect the company's
credit ratings based on the currently available information.
Fitch currently rates BLL as:
-- Issuer default rating (IDR) 'BB'
-- Senior secured credit facilities 'BB+'
-- Senior unsecured notes 'BB'
As reported in the Troubled Company Reporter on Feb. 20, 2006,
Standard & Poor's Ratings Services revised its outlook on
Broomfield, Colo.-based Ball Corp. to stable from positive. At
the same time, Standard & Poor's affirmed its ratings, including
its 'BB+' corporate credit rating, on the metal can and plastic
packaging producer. These actions follow the recent announcement
by Ball that it has entered into a definitive agreement to acquire
U.S. Can Corp.'s (B/Watch Dev/--) U.S. and Argentinean operations
for approximately 1.1 million shares of Ball common stock plus the
assumption of $550 million of U.S. Can's debt.
BENCHMARK ELECTRONICS: Declares 3-for-2 Stock Split
---------------------------------------------------
Benchmark Electronics, Inc.'s (NYSE:BHE) Board of Directors has
declared a 3-for-2 stock split in the form of a stock dividend.
Shareholders of record at the close of business March 27, 2006
will receive one additional share for every two shares owned. The
additional shares will be distributed on or about April 3, 2006.
On March 14, 2006, the Company had 42,585,479 shares of common
stock outstanding. After the stock split, the Company will have
approximately 63,878,218 shares of common stock outstanding.
Benchmark Electronics, Inc. -- http://www.bench.com/--
manufactures electronics and provides its services to original
equipment manufacturers of computers and related products for
business enterprises, medical devices, industrial control
equipment, testing and instrumentation products, and
telecommunication equipment. Benchmark's global operations
include facilities in eight countries. Benchmark's Common Shares
trade on the New York Stock Exchange under the symbol BHE.
* * *
Moody's assigned these ratings to Benchmark on March 12, 2003:
* Long term corporate family rating -- Ba3
* Bank loan debt -- Ba2
* Equity linked -- B2
Standard & Poor's assigned these ratings on July 22, 2003:
* Long term foreign issuer credit -- BB-
* Long term local issuer credit -- BB-
Benchmark Electronics, Inc., is the borrower under a $100,000,000
Second Amended and Restated Credit Agreement dated as of Jan. 20,
2005, with JPMorgan Chase Bank, N.A., individually and as
Administrative Agent, Collateral Agent and Issuing Lender; Fleet
National Bank, individually and as Co-Documentation Agent;
Comerica Bank, individually and as Co-Documentation Agent; Wells
Fargo Bank, N.A., individually and as Co-Documentation Agent; The
Bank of Tokyo-Mitsubishi, Ltd., Houston Agency; Citicorp Usa Inc.;
Credit Suisse First Boston, acting through its Cayman Islands
Branch; and J.P. Morgan Securities Inc., as Lead Arranger. The
Credit Agreement matures on January 20, 2008.
BIRCH TELECOM: Has Until April 8 to Remove Civil Actions
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
through April 8, 2006, the time within which Birch Telecom, Inc.,
and its debtor-affiliates may file notices with respect to
prepetition civil actions pursuant to Rule 9006(b) of the Federal
Rules of Bankruptcy Procedure.
The Debtors are parties to numerous judicial and administrative
proceedings currently pending in various courts and administrative
agencies throughout the country. Those actions consist of all
forms of commercial, tort and employment-related litigation.
The Debtors gave the Court three reasons supporting the extension:
1) they have devoted most of the time since the Petition Date
in stabilizing their businesses, implementing various cost-
saving measures and implementing procedures to comply with
the substantial reporting and disclosure requirements
required for debtors-in-possession;
2) the requested extension will give them more time and
opportunity to make fully-informed decisions concerning the
removal of the prepetition civil actions in order to
protect their valuable right to adjudicate lawsuits
pursuant to 28 U.S.C. Section 1452;
3) the requested extension will not prejudice the Debtors'
adversaries in the civil actions because if the extension
is granted, it will not prevent those adversaries from
seeking a remand pursuant to 28 U.S.C. Section 1452(b).
Headquartered in Kansas City, Missouri, Birch Telecom, Inc., and
its subsidiaries -- http://www.birch.com/-- own and operate an
integrated voice and data network, and offer a broad portfolio of
local, long distance and Internet services. The Debtors provide
local telephone service, long-distance, DSL, T1, ISDN, dial-up
Internet access, web hosting, VPN and phone system equipment for
small- and mid-sized businesses. Birch Telecom and 28 affiliates
filed for chapter 11 protection on Aug. 12, 2005 (Bankr. D. Del.
Case Nos. 05-12237 through 05-12265). Mark S. Chehi, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represents Birch and its
debtor-affiliates in its second chapter 11 restructuring since
2002. Robert P. Simons, Esq., and Kurt F. Gwynne, Esq., at Reed
Smith LLP, provide the Official Committee of Unsecured Creditors
with legal advice and Chanin Capital Partners LLC provides the
Committee with financial advisory services. When the Debtors
filed for protection from their creditors, they estimated more
than $100 million in assets and debts.
BLOCKBUSTER INC: Registers 7-1/2% Preferred Stock for Resale
------------------------------------------------------------
Blockbuster Inc. filed a registration statement with the
Securities and Exchange Commission to allow the resale of:
-- 150,000 shares of its 7-1/2% Series A Cumulative Convertible
Perpetual Preferred Stock,
-- the shares of its class A common stock issuable upon
conversion of the Series A Preferred Stock, and
-- any common shares that may be delivered in connection with a
dividend payment on the Series A Preferred Stock.
The Series A Preferred Stock was offered to qualified
institutional buyers in reliance on Rule 144A in transactions
exempt from the registration requirements of the Securities Act of
1933 through the initial purchasers:
* Citigroup Global Markets Inc.,
* J.P. Morgan Securities Inc., and
* Credit Suisse Securities (USA) LLC.
The Company will pay annual dividends on each share of Series A
Preferred Stock in the amount of $75.00. Dividends will be
payable to the extent that:
-- payment of dividends is not prohibited by the Company's debt
agreements,
-- assets are legally available to pay dividends, and
-- the board of directors or an authorized committee of the
board declares a dividend payable.
The Company may pay dividends in cash, common shares or any
combination of cash and class A common stock, at the Company's
discretion, after every quarter.
Holders may convert each share of their Series A Preferred Stock
at any time into approximately 194.175 shares of class A common
stock of Blockbuster, based on an initial conversion price of
$5.15. The conversion price may be adjusted upon the occurrence
of certain events.
The class A common stock currently trades on the New York Stock
Exchange under the symbol "BBI." The Series A Preferred Stock is
eligible for trading in The PORTAL(R) Market, a subsidiary of The
Nasdaq Stock Market, Inc. However, the shares of Series A
Preferred Stock that are registered pursuant to the registration
statement filed, will no longer be eligible for trading in The
PORTAL(R) Market. The Series A Preferred Stock is not listed on
any securities exchange or included in any automated quotation
system and the Company does not intend to apply for a listing.
On or after November 20, 2010, the Company may, at its option,
cause the conversion right of the Series A Preferred Stock to
expire, but only if the closing sale price of its class A common
stock for 20 trading days within a period of 30 consecutive
trading days ending on the trading day before the date the Company
gives the termination notice exceeds 130% of the conversion price
of the Series A Preferred Stock on each such trading day.
A full-text copy of the Registration Statement is available for
free at http://ResearchArchives.com/t/s?713
Blockbuster Inc. -- http://www.blockbuster.com/-- is a global
provider of in-home movie and game entertainment, with more than
9,000 stores throughout the Americas, Europe, Asia and Australia.
* * *
As reported in the Troubled Company Reporter on Mar. 15, 2006,
Moody's Investors Service affirmed Blockbuster Inc. long term debt
ratings and its SGL-3 speculative grade liquidity rating:
* Corporate family rating at B3;
* Senior secured bank credit facilities at B3; and
* Senior subordinated notes at Caa3.
As reported in the Troubled Company Reporter on Nov. 15, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
and bank loan ratings on Blockbuster Inc. to 'B-' from 'B' and the
subordinated note rating to 'CCC' from 'CCC+'. At the same time,
ratings on the company were removed from CreditWatch, where they
were placed with negative implications on August 3, 2005. S&P
said the outlook is negative.
As reported in the Troubled Company Reporter on Aug. 15, 2005,
Fitch downgraded Blockbuster Inc.'s:
-- Issuer default rating (IDR) to 'CCC' from 'B+';
-- Senior secured credit facility to 'CCC' from 'B+' with an
'R4' recovery rating;
-- Senior subordinated notes to 'CC' from 'B-' with an 'R6'
recovery rating.
Fitch said the Rating Outlook remains Negative.
BLOCKBUSTER INC: Exchanging 9% Sr. Sub. Notes for Registered Bonds
------------------------------------------------------------------
Blockbuster Inc. is offering to exchange up to $300,000,000
aggregate principal amount of its outstanding 9% Senior
Subordinated Notes due 2012, issued in a private offering on
August 20, 2004, in exchange for new notes with materially
identical terms that have been registered under the Securities Act
of 1933, and are generally freely tradable.
Terms of the Notes
The notes mature on September 1, 2012. The first interest
payments on the outstanding notes were made on March 1, 2005,
September 1, 2005, and March 1, 2006. Interest on the new notes
is payable on March 1 and September 1 of each year, with the next
interest payment due on September 1, 2006. Interest on the new
notes will accrue from the most recent date to which interest has
been paid on the outstanding notes.
The Company may redeem the new notes, in whole or in part, on or
after September 1, 2008. In addition, prior to September 1, 2007,
the Company may redeem up to 35% of the new notes using the net
proceeds of certain equity offerings.
Upon a change of control, holders of the Notes may require the
Company to repurchase all or a portion of the new notes at a
purchase price of 101% of their principal amount, plus accrued and
unpaid interest.
The new notes and the guarantees will be the Company's and its
subsidiary guarantors' unsecured senior subordinated obligations.
The new notes will be guaranteed on a senior subordinated basis by
the Subsidiary Guarantors. The new notes will rank junior to all
of our and the Subsidiary Guarantors' existing and future senior
indebtedness.
A full-text copy of the Registration Statement is available for
free at http://ResearchArchives.com/t/s?714
Blockbuster Inc. -- http://www.blockbuster.com/-- is a global
provider of in-home movie and game entertainment, with more than
9,000 stores throughout the Americas, Europe, Asia and Australia.
* * *
As reported in the Troubled Company Reporter on Mar. 15, 2006,
Moody's Investors Service affirmed Blockbuster Inc. long term debt
ratings and its SGL-3 speculative grade liquidity rating:
* Corporate family rating at B3;
* Senior secured bank credit facilities at B3; and
* Senior subordinated notes at Caa3.
As reported in the Troubled Company Reporter on Nov. 15, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
and bank loan ratings on Blockbuster Inc. to 'B-' from 'B' and the
subordinated note rating to 'CCC' from 'CCC+'. At the same time,
ratings on the company were removed from CreditWatch, where they
were placed with negative implications on August 3, 2005. S&P
said the outlook is negative.
As reported in the Troubled Company Reporter on Aug. 15, 2005,
Fitch downgraded Blockbuster Inc.'s:
-- Issuer default rating (IDR) to 'CCC' from 'B+';
-- Senior secured credit facility to 'CCC' from 'B+' with an
'R4' recovery rating;
-- Senior subordinated notes to 'CC' from 'B-' with an 'R6'
recovery rating.
Fitch said the Rating Outlook remains Negative.
BMC INDUSTRIES: Committee Wants More Data in Disclosure Statement
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in BMC
Industries Inc. and its debtor-affiliates' Chapter 11 cases,
objects to the adequacy of the information contained in the
Debtors' Plan of Liquidation and the Disclosure Statement
explaining that Plan.
The Committee wants the Debtors to:
a) attach a liquidating trust document to the Disclosure
Statement or the Plan. The Committee needs to see the
completed form of the liquidating trust document to ensure
that it is consistent with the Disclosure Statement and the
Plan.
b) fill in numerous blanks found in the Disclosure
Statement and Plan, and attach all necessary
exhibits referred to in the Disclosure Statement and
Plan.
c) describe in the Plan and Disclosure Statement how the
claims of Frank Kundart and Gerald Becker will be treated
if their appeal is successful;
d) clarify what happens if Insight's administrative claim
gets paid from the Trust and Insight drops its litigation
with the secured lender bank group;
e) clarify estimates concerning the funds available to the
liquidating trust to pay outstanding administrative claims
and pursue the avoidance actions;
f) clarify in the Disclosure Statement of Plan whether or not
trustee fees will continue to be paid post-confirmation,
and for what period of time; and
g) describe how the liquidating trust attorneys -- for the
purpose of pursuing avoidance -- will be paid.
Thomas J. Flynn, Esq., at Larkin Hoffman Daly & Lindgren Ltd.,
explains that the Committee's requests for information are
questions for clarification under the Plan and Disclosure
Statement, and should not be seem as strict objections. Mr. Flynn
says that the Committee is confident of the Debtors' ability to
confirm a consensual plan.
Debtors' Response
The Debtors tell the U.S. Bankruptcy Court for the District of
Minnesota that they intend to modify their Disclosure Statement
and Plan in response to the objections posed by the U.S. Trustee,
the Committee and Insight Equity A.P.X, LP.
However, the Debtors have elected not to file an amended Plan and
Disclosure Statement prior to the hearing on the Disclosure
Statement to minimize costs. A hearing to consider the adequacy
of the Debtors' Disclosure Statement was scheduled on March 15,
2006. As of March 27, 2006, Court filings do not show if the
Disclosure Statement has been approved.
A summary of the Debtors' response to Disclosure Statement
(and Plan-related) Objections is available for free at
http://researcharchives.com/t/s?709
Abbreviated Disclosure Statement
The Debtors ask the Bankruptcy Court for authority to distribute
an abbreviated form of their Disclosure Statement to their equity
security holders.
The Debtors say that distributing the 150-page Disclosure
Statement and Plan to over 5,000 shareholders is an unwarranted
and an unnecessary drain on their resources. The Debtors assure
the Bankruptcy Court that the abbreviated Disclosure Statement
contains adequate information to permit shareholders to make an
informed decision about the Plan.
A copy of the Abbreviate Disclosure Statement is available for a
fee at:
http://www.researcharchives.com/bin/download?id=060328041106
Headquartered in Ramsey, Minnesota, BMC Industries Inc. --
http://www.bmcind.com/-- is a multinational manufacturer and
distributor of high-volume precision products in two business
segments, Optical Products and Buckbee Mears. The Company, along
with its affiliates, filed for chapter 11 protection (Bankr. D.
Minn. Case No. 04-43515) on June 23, 2004. Jeff J. Friedman,
Esq., at Katten Muchin Zavis Rosenman, and Clinton E. Cutler,
Esq., at Fredrikson & Byron, P.A., represent the Debtors in there
restructuring efforts. Thomas J. Flynn, Esq., at Larkin, Hoffman,
Daly & Lindgren, Ltd., represents the Official Committee of
Unsecured Creditors. When the Debtor filed for protection from
its creditors, it listed $105,253,000 in assets and $164,751,000
in liabilities.
BOOKHAM INC: All 7% Conv. Debentures Converted to Common Stock
--------------------------------------------------------------
Bookham, Inc. (Nasdaq: BKHM) reported that on March 22, 2006, its
stockholders approved the issuance of 1,106,477 shares of Common
Stock to satisfy the conversion of the remaining portion of the
Company's 7% senior unsecured convertible debentures. This
approval was received pursuant to the second closing of a
Securities Exchange Agreement originally announced on Jan. 13,
2006 between Bookham and its debenture holders. In connection
with this closing, Bookham also issued an additional 178,990
shares of Common Stock and warrants to purchase up to 95,461
shares of Common Stock and paid the debenture holders an
aggregate of $538,408.51 in cash.
As a result of this second closing, all of Bookham's 7% senior
unsecured convertible debentures have now been converted, and the
Company no longer has any debt outstanding.
About Bookham Inc.
Bookham, Inc. -- http://www.bookham.com/-- designs, manufactures
and markets optical components, modules and subsystems that
generate, detect, amplify, combine and separate light signals
principally for use in high-performance fiber optics
communications networks.
* * *
Going Concern Doubt
Ernst & Young LLP expressed substantial doubt about Bookham,
Inc.'s ability to continue as a going concern after it audited
the Company's financial statements for the fiscal year ended
July 2, 2005.
Nortel Obligations Loom
Based on its cash balances and its cash flow forecasts, and given
its continuing losses, the Company estimates it will need to raise
between $20 and $30 million prior to December 2005 in order to
maintain its planned level of operations. The Company further
estimates that it will need to raise between $50 million and $60
million on a cumulative basis between Sept. 2005 and Aug. 2006 in
order to comply with the $25 million minimum cash balance required
by the terms of the notes held by Nortel Networks.
If the Company is unable to maintain this cash balance after
August 2006, it will be in default under the promissory notes.
Beyond this, the Company will need to raise additional funds to
repay the notes issued to Nortel Networks in the aggregate
principal amounts of $25.9 million and $20 million that will be
due and payable in Nov. 2006 and 2007, respectively, and to repay,
if still outstanding, $25.5 million principal amount of its 7%
convertible debentures due in Dec. 2007.
CALPINE CORP: Court Issues 2nd Amended Final Cash Collateral Order
-----------------------------------------------------------------
As reported in the Troubled Company Reporter on March 10, 2006,
the U.S. Bankruptcy Court for the Southern District of New York
authorized, on a final basis, Calpine Corporation and its debtor-
affiliates to:
1. use the Calpine Corp. Cash Collateral to:
* pay the Debtors' ordinary and necessary business
expenses;
* pay expenses related to the administration of the
Debtors' estates and the Chapter 11 cases; and
* make adequate protection payments of principal and
interest or other amounts;
2. use the Restricted Cash in accordance with any applicable
Cash Waterfall Provisions;
3. distribute Unrestricted Cash to their parent entities that
are Debtors through a Project Intercompany Loan
notwithstanding the existence of an event of default or
cross-default under the Project Loan Documents, or the
insolvency of, the Project Debtors or any affiliates of
the Project Debtors or resulting from the failure by any
Debtor to make any payment during the prepetition period;
and
4. incur indebtedness under a Project Intercompany Loan,
provided, however, that Calpine Greenleaf, Inc. will also
be authorized to use Restricted Cash to pay the
prepetition portion of the invoices for maintenance and
similar expenses.
The Court previously approved interim amendments to the Final Cash
Collateral Order.
Under the Amended Final Cash Collateral Order, the Court finds it
necessary to protect the Project Lessors' interest in the
applicable leased facility and collateral pledged, if any, by the
Project Lessees to secure the applicable Project Lessee's
obligations.
As adequate protection for any diminution in value of the Project
Lender Collateral or the Project Lessor Collateral, including,
from the use of the Restricted Cash in accordance with the
applicable Cash Waterfall Provisions, the use of the Unrestricted
Cash as well as Project Lender Collateral or the Project Lessor
Collateral, the Court rules that each Project Lessor will receive
reasonable fees and disbursements including, the fees of counsel
and financial advisors to the Project Lessors, the indenture
trustees and pass-through trustees, the Ad Hoc Committee,
Quadrangle or agents under the Project Loan Documents and Project
Lease Documents.
* * *
The Hon. Burton R. Lifland issued a second amended Final Cash
Collateral Order to authorize Calpine Greenleaf, Inc., to use the
Restricted Cash to pay the prepetition portion of invoices --
aggregating $383,494 -- from vendors for maintenance and similar
expenses, to the extent payment is reasonably necessary for the
adequate protection of the interest of the project lenders for
Calpine Greenleaf in any collateral pledged by the Debtors to
secure obligations under the Greenleaf Project Documents.
Calpine Greenleaf vendors are:
Vendor Invoice Amount
------ --------------
Rexel Norcal Valley $3,530
Trane 18,296
Consolidated Electrical Distributors 6,843
TurboCare 330,615
High Voltage Apparatus Repair & Testing 24,209
Headquartered in San Jose, California, Calpine Corporation --
http://www.calpine.com/-- supplies customers and communities with
electricity from clean, efficient, natural gas-fired and
geothermal power plants. Calpine owns, leases and operates
integrated systems of plants in 21 U.S. states and in three
Canadian provinces. Its customized products and services include
wholesale and retail electricity, gas turbine components and
services, energy management and a wide range of power plant
engineering, construction and maintenance and operational
services. The Company filed for chapter 11 protection on Dec. 20,
2005 (Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard M. Cieri,
Esq., Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert
G. Burns, Esq., Kirkland & Ellis LLP represent the Debtors in
their restructuring efforts. Michael S. Stamer, Esq., at Akin
Gump Strauss Hauer & Feld LLP, represents the Official Committee
of Unsecured Creditors. As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities. (Calpine Bankruptcy News, Issue No. 11; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
CARMIKE CINEMAS: Moody's Holds Junked Senior Subord. Note Rating
----------------------------------------------------------------
Moody's Investors Service changed the outlook for Carmike Cinemas,
Inc., to negative from positive following the announcement that
Carmike does not expect to file its form 10k by the extended March
31 deadline. The change in outlook reflects Moody's expectation
that an upgrade over the next 12 to 18 months is unlikely, due to
both weaker than anticipated fundamental performance and concerns
over financial reporting and accounting.
Moody's would consider a reversion to a stable outlook following
satisfactory resolution of Carmike's compliance issues and
significant progress towards remediation of the internal control
weaknesses. Moody's believes bank lenders are likely to waive
Carmike's breach of its the credit agreement requirement to file
timely financial statements, but Carmike's weak internal controls,
including insufficient financial staff, raise concerns.
Moody's also affirmed Carmike's B2 corporate family rating, the B1
senior secured bank facility rating and the Caa1 rating on
Carmike's senior subordinated notes. Carmike's ratings reflect
high financial risk; sensitivity to the film industry's ability to
consistently supply compelling product; lack of scale; and
concerns over the company's ability to hire and retain sufficient
financial staff. Carmike's dominant position in its targeted
smaller markets and strong concession margins somewhat mitigate
these risks.
Rating actions:
* Outlook: Changed to Negative from Positive
* B2 Corporate Family Rating Affirmed
* B1 Rating on Secured Bank Credit Facility Affirmed
* Caa1 Rating on Senior Subordinated Notes Affirmed
The negative outlook incorporates Moody's concerns over Carmike's
delayed filing of its form 10k and the resultant need to seek
waivers for the requirement to file timely financial statements
from its bank lenders. Additionally, the weak internal controls,
including continued challenges in hiring and retaining financial
staff with the appropriate expertise, pose risk. Should Carmike
resolve these accounting issues and demonstrate significant
progress towards remediation of its internal control weaknesses, a
stable outlook is likely. Due to Moody's concerns over staffing
and control issues, as well as weaker than expected fundamental
performance, a positive outlook is unlikely over the intermediate
term. Moody's would consider a positive outlook if leverage fell
below 5 times and evidence of a more robust financial staff
existed.
Carmike's financial risk includes leverage of approximately 6.1
times, weak coverage of fixed charges, and negative free cash
flow. Operational challenges include the dependence of movie
theater attendance and resultant cash flow on the quality of
available films. Carmike's average of approximately 8 screens per
theater, below the industry average of approximately 11, limits
its ability to deliver a diversity of films to viewers and
magnifies this challenge. The company focuses its theater
operations in small- to mid-sized communities with populations of
fewer than 100,000; accordingly, its per screen and per theater
attendance, revenue, and EBITDA are lower than most rated theater
operators and its potential cash flow from high margin advertising
is much lower than its peers. Finally, Carmike's incremental
financing capacity provides the potential for increased leverage
as acquisition opportunities arise, although Moody's believes
management will restrict future growth initiatives to its core
small market expertise.
Notwithstanding the relatively lower revenue and margin
opportunities, Carmike's competitive position is reasonably well-
protected, because its smaller markets are less likely to draw new
entrants. Carmike also benefits from above average concession
margins. Within the past five years, Carmike rebuilt or remodeled
about 80% of its screens, and with better film supply, attendance
trends will likely benefit from the improved asset base. While
the quarterly dividend instituted in the second half of 2004 will
consume a modest portion of free cash flow, expectations for lower
capital expenditures following the completion of the
aforementioned theater upgrade initiative should yield free cash
flow improvements. Additionally, Moody's believes management will
apply future free cash flow to expansion or debt reduction before
increasing dividends, a credit positive in an industry prone to
large shareholder rewards that often come at the expense of debt
holders.
Moody's considers Carmike's leverage of 6.1 times debt-to-EBITDA
high, particularly given the fixed costs and inherent revenue
volatility of the theater industry. Furthermore, fixed charge
coverage is less than 1 time and Carmike consumed cash flow after
debt service and capital expenditures over the trailing twelve
months through Sept. 30, 2005, after generating only modestly
positive cash flow in 2004.
The senior secured bank facility, which consists of a $50 million
revolver, a $170 million term loan and a $185 million delayed draw
term loan, is notched up to B1 from the B2 corporate family
rating. The bank debt benefits from a fairly meaningful layer of
junior capital beneath it, consisting of $150 million of senior
subordinated notes and Carmike's public equity, as well as
capitalized operating leases valued at approximately $400 million.
The bank debt also benefits from its perfected first priority
security interest in all Carmike assets. Carmike's owns
approximately 25% of its theaters, which enhances the value of the
collateral, in Moody's view. The two notch gap between the
corporate family rating and the Caa1 senior subordinated notes
reflects that tranche's contractual and effective subordination to
all other existing debt.
Carmike is one of the country's largest motion picture exhibitors
with approximately 2,500 screens and 300 theaters as of Sept. 30,
2005, and annual revenue slightly under $500 million. The company
maintains its headquarters in Columbus, Georgia.
CATHOLIC CHURCH: DuFresne Wants Portland to Account for Properties
------------------------------------------------------------------
Paul E. DuFresne identified 11 properties allegedly owned by the
Archdiocese of Portland in Oregon but were not included in its
Statement of Financial Affairs, nor in any of its revised
Statements submitted to the U.S. Bankruptcy Court of the District
of Oregon:
Tax Assessed
Tax ID No. Location Value
----------- -------- ------------
1549250 Lane County $647
0003364 Linn County 8,790
0003430 Linn County 101,600
0003448 Linn County 300,620
0092896 417 11th Ave SW, Linn County 147,780
M00199414 404 Man St., Yamhill -
M00101392 445 N. Maple St., Yamhill -
174718 Benton County 99,970
296409 Benton County 44,629
1574167 Lane County -
1631579 402 Holbrook LN, Lane County 766,855
With respect to each of the 11 properties, Mr. DuFresne asks the
Court to direct the Archdiocese to either:
(1) indicate where in the Statements or in any of its
subsequent revision the property appears;
(2) show the reason why the property was not included in the
Statements; or
(3) file revised Statements and an explanation how the
property was left off of the Statements.
Mr. DuFresne informs the Court that the aggregate tax assessed
value of the 11 properties for the tax year 2004-2005 was
$1,490,891. Although small compared to the overall value of the
Archdiocese's estate, the properties appear to be largely single-
family homes or vacant land. Thus, they would be easily marketed
and their liquidation would not impede the Archdiocese's operation
in anyway.
Mr. DuFresne also points out that properties usually increase in
market value over time.
These factors, in addition to Portland's obligations under the
Bankruptcy Code, demonstrate the importance of a complete
disclosure of the Archdiocese's owned real estate.
Since the list of the missing properties is not necessarily
complete, the Archdiocese "can also include any additional real
estate, which has not yet been disclosed in the revised
disclosures", Mr. DuFresne asserts.
Archdiocese Responds
Thomas W. Stilley, Esq., at Sussman Shank LLP, in Portland,
Oregon, informs the Court that each of the real properties that
Mr. DuFresne contends were left off the Disclosures were in fact
included in the Statements, with the exception of certain
properties that had previously been sold:
Specifically, Mr. Stilley explains that the property with:
(1) Tax ID No. 1549250 is part of a split code, and is
included on Exhibit 14 B to the Statements, as APN
1231958;
(2) Tax ID No. 0003364 is included on Exhibit 14 B, as APN
336401;
(3) Tax ID NO. 0003430 is included on Exhibit 14 B, as APN
3430;
(4) Tax ID No. 0003448 is included on Exhibit 14 B, as APN
3448;
(5) Tax ID No. M00199414 is a manufactured home with Tax
Assessor's Market Value $30,250, located on property which
is included on Exhibit 14 B, as APN 115262;
(6) Tax ID No. M000101392 is a mobile home, with Tax
Assessor's Market Value at $13,346, located on the
property, which is included on Exhibit 14 B, as APN 87907;
(7) Tax ID No. 1574167 has an inactive number, according to
the Lane County Tax Assessor's office. The property is
included on Exhibit 14B, APN 1175346; and
(8) Tax ID No. 1631579 property is included on Exhibit 14 B,
as APN 1083466, which was its former account number.
The properties with Tax ID Nos. 174718, 296409, 0092896 were sold
prepetition, Mr. Stilley adds.
"Mr. DuFresne's questions could easily have been answered without
the need for filing the Motion if he had only asked," Mr. Stilley
tells the Court. "This Motion is only the most recent in a series
of meritless motions that Mr. DuFresne has filed which could have
been resolved without the need for . . . attorneys to prepare a
formal response and the Court to conduct a hearing."
Mr. Stilley complains that Mr. DuFresne's requests cause
unnecessary expense to the estate, and must not be allowed to
continue. The Archdiocese has already incurred thousands of
dollars in attorney's fees and spent many hours in gathering
information to respond to his request, Mr. Stilley says.
For these reasons, the Archdiocese asks the Court to:
(a) deny Mr. DuFresne's request; and
(b) direct Mr. DuFresne to confer with the Archdiocese in a
good faith effort to resolve any future matters prior to
filing any further requests.
* * *
The Court rules that the Archdiocese is not required to amend its
Statement of Financial Affairs with respect to any of the
properties identified by Mr. DuFresne.
However, the Court directs the Archdiocese to:
(a) reflect the correct property tax account number for the
property listed as Tax ID No. 0003364; and
(b) reflect the correct tax assessed value as of the Petition
Date of the property listed as Tax ID No. 1631579.
With respect to all requests that Mr. DuFresne intends to file in
the future, Judge Perris directs him within 20 days before filing
any request with the Court, to:
(1) mail a written copy of the proposed request to the
Archdiocese's counsel, Susan S. Ford, Esq., at Sussman
Shank LLP, and give the Archdiocese an opportunity to
respond; and
(2) confer in good faith with Ms. Ford in an attempt to
resolve the subject matter of the request.
All requests by Mr. DuFresne that are filed with the Court should
contain his signed certification that he complied with the two
conditions, but was unable to resolve the matter prior to filing
the request.
About Archdiocese of Portland
The Archdiocese of Portland in Oregon filed for chapter 11
protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004.
Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman
Shank LLP, represent the Portland Archdiocese in its restructuring
efforts. Albert N. Kennedy, Esq., at Tonkon Torp, LLP, represents
the Official Tort Claimants Committee in Portland, and scores of
abuse victims are represented by other lawyers. David A. Foraker
serves as the Future Claimants Representative appointed in the
Archdiocese of Portland's Chapter 11 case. In its Schedules of
Assets and Liabilities filed with the Court on July 30, 2004, the
Portland Archdiocese reports $19,251,558 in assets and
$373,015,566 in liabilities. (Catholic Church Bankruptcy News,
Issue No. 54; Bankruptcy Creditors' Service, Inc., 215/945-7000)
CENDANT CAR: Moody's Rates $1 Billion Unsecured Notes at Ba3
------------------------------------------------------------
Moody's Investors Service assigned these ratings to Cendant Car
Rental Group, LLC:
* Corporate Family Rating -- Ba2;
* $1.5 billion five-year secured revolving credit facility and
$875 million six-year secured term loan -- Ba2;
* $1.0 billion of eight- and ten-year senior unsecured notes
due 2014 and 2016 -- Ba3; and
* Speculative Grade Liquidity rating -- SGL-2.
The Outlook is Stable.
The ratings anticipate that following the completion of the
proposed separation of Cendant Corporation into four independent,
publicly traded companies, Cendant Car Rental Group, LLC will be
the parent company of Cendant's Vehicle Rental operations and will
be renamed Avis Budget Car Rental, LLC.
The Ba2 Corporate Family Rating reflects Moody's view that the
business model, brand strength, and cost structure of CCRG
position it to compete effectively with key peers in the vehicle
daily rental business, and are consistent with a rating in the
upper end of the speculative grade range. However, the company's
financial leverage, and potential risks related to significant
fleet concentration in GM vehicles are factors that constrain the
rating at the Ba2 level. The rating also recognizes that CCRG's
financial leverage is somewhat lower than that of certain major
domestic competitors; this should enable the company to sustain
superior credit metrics relative to peers through the intermediate
term.
The secured credit facility and term loan are rated at the same
Ba2 level as CCRG's Corporate Family Rating. The rating of these
secured obligations is constrained by the significant level of
securitized ABS fleet debt in the company's capital structure, as
well as the limited scope of the remaining non-fleet assets that
provide security for the bank facilities.
The Ba3 rating of the proposed $1 billion of unsecured notes
reflects both the junior position of these securities in the CCRG
capital structure, as well as the preponderance of secured debt
-- both ABS fleet debt and secured bank debt. The rating
anticipates that the proposed notes' final documentation will be
adequate and will contain appropriate indenture provisions.
The SGL-2 Speculative Grade Liquidity rating recognizes the
considerable amount of availability under the $1.5 billion
revolving credit facility, the relatively short holding period for
the CCRG fleet vehicles, the company's ability to return fleet
vehicles to manufacturers under "buy-back" programs, and the
flexibility to rapidly curtail the purchase of new vehicles during
a downturn. Moody's also believes that the credit facility
affords CCRG reasonable head room under the relevant covenant
provisions. The strength of these liquidity sources are tempered,
however, by the eroding credit quality of General Motors and the
attendant risk to GM's ability to continue repurchasing vehicles
from CCRG under its "buy-back" agreement. In addition, because the
majority of CCRG's assets are pledged, the company has modest
ability to raise cash through asset sales.
Through the Avis and Budget brands that it owns, CCRG holds the
leading market share in the US on-airport car rental sector with
share approximating 32%; its nearest competitors Hertz and
National/Alamo hold about 30% and 20% respectively. Moody's
believes that CCRG's dual branding strategy affords it a strong
competitive position in both the premium rental sector and the
value segment.
Similar to other major on-airport rental companies, the vast
majority of CCRG's automobile fleet consists of "program cars"
that will be repurchased by the automobile OEM within a relatively
short period -- generally less than 12 months. These OEM
repurchase commitments contribute to CCRG's liquidity and its
ability to respond to downturns. However, for 2005 approximately
63% of the company's domestic program vehicles were purchased from
General Motors and 21% from Ford. The eroding credit quality of
these manufacturers, particularly GM, adds an additional degree of
risk to these repurchase obligations, and is an important rating
consideration.
For fiscal 2005, Cendant Corporation's vehicle rental segment had
debt/EBITDA of 4.0 and EBITDA/revenues of 37% based on public
financial statements, with debt including asset backed
securitizations and EBITDA calculated before vehicle depreciation
and interest. Moody's expects that profitability and leverage
measures of CCRG will demonstrate moderate improvement from these
levels over the intermediate term.
Cendant Car Rental Group, LLC, headquartered in Parsippany New
Jersey, will be the immediate parent company of Cendant
Corporation's Vehicle Rental operations following Cendant's
separation into four separate businesses. The company will be
renamed Avis Budget Car Rental, LLC.
CENTURY ALUMINUM: Gaia Offshore & Lyxor/Gaia May Sell Conv. Notes
-----------------------------------------------------------------
Gaia Offshore Master Fund, Ltd., and Lyxor/Gaia II Fund Ltd., may
resell 1.75% Convertible Senior Notes due August 1, 2024, issued
by Century Aluminum Co. and shares of Century's common stock
issuable upon conversion of the notes.
Gaia Offshore holds $2,250,000 of principal amount of Convertible
Notes, comprising 1.29% of $175,000,000, the total principal
amount issued. Lyxor/Gaia II Fund Ltd. holds $750,000 of
principal amount of Convertible Notes.
Promethean Asset Management, LLC, is the investment manager of
Gaia Offshore and Lyxor/Gaia.
Terms of the Notes
The notes are convertible at any time at an initial conversion
rate of 32.7430 common shares per $1,000 principal amount of
notes, subject to adjustments for certain events. The initial
conversion rate is equivalent to a conversion price of
approximately $30.5409 per common share. Upon conversion, Century
will deliver cash up to the aggregate principal amount of notes to
be converted and, at Century's election, cash, common shares or a
combination thereof in respect of the remainder, if any, of
Century conversion obligation in excess of the principal amount of
notes to be converted. Therefore, holders of the notes may not
receive any shares of Century's common shares upon conversion, and
they only may receive common shares to the extent that the
conversion obligation exceeds the principal amount of the notes
converted.
A full-text copy of the Prospectus Supplement is available for
free at http://ResearchArchives.com/t/s?70d
A full-text copy of the Prospectus is available for free at
http://ResearchArchives.com/t/s?db
Century Aluminum Co. presently owns 615,000 metric tonnes per year
(mtpy) of primary aluminum capacity. The company owns and
operates:
* a 244,000 mtpy plant at Hawesville, Kentucky;
* a 170,000 mtpy plant at Ravenswood, West Virginia; and
* a 90,000 mtpy plant at Grundartangi, Iceland that is being
expanded to 220,000 mtpy.
The company also owns a 49.67-percent interest in a 222,000 mtpy
reduction plant at Mt. Holly, South Carolina. ALCOA Inc. owns the
remainder of the plant and is the operating partner. With the
completion of the Grundartangi expansion, Century's total capacity
will stand at 745,000 mtpy by the fourth quarter of 2006. Century
also holds a 50-percent share of the 1.25 million mtpy Gramercy
Alumina refinery in Gramercy, Louisiana and related bauxite assets
in Jamaica. Century's corporate offices are located in Monterey,
California.
* * *
As reported in the Troubled Company Reporter on Dec. 7, 2004,
Moody's Investors Service assigned a B1 rating to Century Aluminum
Company's $175 million senior unsecured convertible notes due
2024, and affirmed its Ba3 rating on Century's $100 million senior
secured revolving credit facility.
As reported in the Troubled Company Reporter on Nov. 9, 2004,
Standard & Poor's Ratings Services raised its rating on Century
Aluminum Company's $150 million 1.75% convertible notes due 2024
to 'BB-' from 'B' and removed it from CreditWatch. At the same
time, Standard & Poor's affirmed its 'BB-' corporate credit rating
on the Monterey, California-based company.
CERVANTES ORCHARDS: Files Chapter 11 Plan & Disclosure Statement
----------------------------------------------------------------
Cervantes Orchards & Vineyards, LLC, delivered to the U.S.
Bankruptcy Court for the Eastern District of Washington, a
disclosure statement explaining its chapter 11 plan of
reorganization on March 21, 2006.
Treatment of Claims
Under the Plan, Administrative Expense Claims, Priority Claims,
and Donna Freeburn's claim will be paid in full, in cash, on the
Distribution Date.
Holders of Class 3 Priority Tax Claims will receive $1,000 in cash
or the amount of the claim, whichever is less, on the Distribution
Date, and will receive the balance of each assessed portion of the
allowed claim in 10 equal quarterly installments.
John Deere Credit, Inc., and US Bank Trust NA are oversecured
creditors and will receive the full value of their claims under
the Plan.
For violation of the Bank Anti-Tying Act, exercise of excessive
control over the Debtor's business, and for improper interference
with the Debtor's contractual relationships and reasonable
business expectations, under the Plan, Columbia Trust Bank's:
a) collateral interest will be subordinated to all other
creditors except insiders; and
b) claim will be treated in its full amount, but payments will
be retained in escrow until the litigation between the
Debtor and Columbia Trust is concluded and the actual
amount due from the Debtor, if any, is determined by Final
Order.
Except for American West Bank's claim, which will receive semi-
annual payments of $11,804, six claims will be paid on an annual
basis in these amounts:
Creditor Annual Payment
-------- --------------
Elbert B. Schinmann $19,374
Douglas F. Bridgeman $25,463
Robert Lambrecht $22,720
Ronald L. Curfman $12,025
Gary Simmons, Kay Moore,
& Sherran Whatley $19,515
Everetti L. Wiggins $7,600
Holders of Unsecured Claims will retain their claims, subject to
objections filed no later than 30 days following confirmation of
the Plan.
Class 9 Related Entity Claims will receive remaining funds
available for distribution after all claims in prior classes are
fully paid and all unit holders will retain their units under the
Plan.
Headquartered in Sunnyside, Washington, Cervantes Orchards and
Vineyards LLC filed for chapter 11 protection on Aug. 19, 2005
(Bankr. E.D. Wash. Case No. 05-06600). R. Bruce Johnston, Esq.,
at Law Offices of R. Bruce Johnston represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed estimated assets of $10 million to
$50 million and estimated debts of $1 million to $10 million.
CHASE FUNDING: Moody's Slashes Class IB Certificate Rating to Ba3
-----------------------------------------------------------------
Moody's Investors Service upgraded four certificates and
downgraded three certificates, previously issued by Chase Funding
Loan Acquisition Trust in 2001. The securitizations are backed by
fixed-rate and adjustable-rate subprime mortgage loans.
The four subordinate and mezzanine certificates from the series
2001-AD1 transaction have been upgraded based on the substantial
build-up in credit support. The projected pipeline losses are not
expected to significantly affect the credit support for these
certificates. The seasoning of the loans and low pool factor
reduces loss volatility.
The three subordinate certificates from the fixed-rate pools in
the 2001-1 and 2001-C2 transactions have been downgraded because
existing credit enhancement levels may be low given the current
projected losses on the underlying pools. The collateral has
taken losses causing gradual erosion of the overcollateralization.
As of Feb. 25, 2006, the level of overcollateralization in both
transactions is below its required 0.50% floor.
Moody's complete rating actions are:
Issuer: Chase Funding Loan Acquisition Trust
Upgrades:
* Series 2001-AD1; Class IM-1, upgraded to Aaa from Aa2
* Series 2001-AD1; Class IIM-1, upgraded to Aaa from Aa2
* Series 2001-AD1; Class IIM-2, upgraded to Aa2 from A2
* Series 2001-AD1; Class IIB, upgraded to A2 from Baa2
Downgrades:
* Series 2001-1; Class IB, downgraded to Ba2 from Baa2
* Series 2001-C2; Class IM-2, downgraded to Baa1 from A2
* Series 2001-C2; Class IB, downgraded to Ba3 from Baa2
CLEARWATER FUNDING: Moody's Cuts Baa3 $50MM Notes' Rating to B1
---------------------------------------------------------------
Moody's Investors Service lowered its rating on the $50,000,000
Class B Second Senior Secured Notes due 2011 issued by Clearwater
Funding CBO 99-A, Ltd. As a result of the action, the Class B
Notes are rated B1.
According to Moody's, current prospects for the notes' repayment
of principal and interest prompted the rating action. Moody's
cited credit deterioration of the collateral portfolio and
diminished asset collateralization as key factors in its
assessment.
Rating Action: Downgrade
Issuer: Clearwater Funding CBO 99-A, Ltd.
Tranche Description: $50,000,000 Class B Second Senior
Secured Notes due 2011
Current Rating: B1
Prior Rating: Baa3 (on Watch for Downgrade)
COEUR D'ALENE: Expects to Raise $146.8M in Common Stock Offering
----------------------------------------------------------------
Coeur d'Alene Mines Corporation (NYSE:CDE, TSX:CDM) is offering
22 million newly issued shares of its common stock under an
effective shelf registration statement on file with the U.S.
Securities and Exchange Commission.
Under an underwriting agreement on March 16, 2006, Coeur will
sell the shares to the public at $5.60 per share. Coeur expects
to get $127.7 million of net proceeds, after the underwriters'
discount, prior to any exercise of the over-allotment option.
Coeur has granted the underwriters a 30-day option to purchase up
to an additional 3.6 million shares of common stock at the public
offering price to cover over allotments.
The underwriters have elected to exercise the over-allotment
option. With the exercise of the 3.6-million share over-allotment
option, the total number of shares to be issued upon the closing
of the transaction on March 22 is 27.6 million shares at the
public offering price of $5.60.
Coeur now expects to receive total net proceeds, after the
underwriters' discount, of approximately $146.8 million.
The company expects to use the proceeds of the offering for:
-- potential acquisition of additional precious metals
properties, rights, or businesses;
-- ongoing investment in existing development projects at the
San Bartolome silver mine in Bolivia and the Kensington gold
mine in Alaska; and
-- general corporate purposes.
Deutsche Bank Securities Inc. and JPMorgan will act as joint book-
running managers of the offering. In addition, Bear Stearns and
RBC Capital Markets will act as co-managers of the offering.
A full text copy of the Prospectus Supplement is available for
free at http://ResearchArchives.com/t/s?70e
Coeur d'Alene Mines Corporation -- http://www.coeur.com/-- is the
world's largest primary silver producer, as well as a significant,
low-cost producer of gold. The Company has mining interests in
Nevada, Idaho, Alaska, Argentina, Chile, Bolivia and Australia.
* * *
As reported in the Troubled Company Reporter on Oct. 4, 2004,
Standard & Poor's Ratings Services affirmed its 'B-' corporate
credit and senior unsecured debt ratings on Coeur D'Alene Mines
Corporation and removed the ratings from CreditWatch, where they
were placed on June 1, 2004, with positive implications. S&P said
the outlook is stable.
COEUR D'ALENE: Earns $9.9 Million in Fourth Quarter of 2005
-----------------------------------------------------------
Coeur d'Alene Mines Corporation earned record quarterly net income
of $9.9 million for the fourth quarter of 2005, compared to net
income of $8.3 million for the year-ago period. Results for the
year-ago quarter included a tax benefit of $5.8 million.
For the full year 2005, the company reported net income of
$10.6 million compared to a net loss of $16.9 million for 2004.
Revenues for the fourth quarter and full year of 2005
reached all-time highs. Revenue for the fourth quarter of 2005
was $54.8 million, a 22% increase compared to revenue of
$44.8 million in the year-ago period. Revenue for the full year
of 2005 was $172.3 million, a 30% increase compared to revenue of
$132.8 million in the year-ago period.
In commenting on the company's performance, Dennis E. Wheeler,
Chairman, President and Chief Executive Officer, said, "The
company reported an all-time record level of quarterly net
income in the fourth quarter of 2005 due in large measure to
solid overall operating performance in a market characterized by
strong demand and robust price levels."
Wheeler added, "We are seeing the benefits of our strategy to
significantly increase our low-cost production ounces, reserves,
cash flow and resulting earnings, a strategy that was
strengthened by our 2005 Australian acquisitions. Our cash cost
per ounce of silver remained very competitive and actually
showed a 30% decline during the second half of 2005 as compared
with the first six months of the year."
Coeur currently expects 2006 silver production to be
approximately 18 million ounces, a 31% increase over the level
of 2005, and depending on the outcome of the company's review of
strategic alternatives for Coeur Silver Valley in Idaho. The
company expects a consolidated silver cash cost per ounce of
approximately $4.11 per ounce, approximately 4% below the
consolidated cash cost for 2005. The company expects full-year
gold production to be approximately 129,000 ounces.
Highlights by Individual Property
-- Cerro Bayo (Chile)
At a silver cash cost of $0.54 per ounce for 2005, Cerro
Bayo remained the lowest-cost mine in Coeur's system.
Coeur's exploration efforts during 2005 at Cerro Bayo were
extremely successful, increasing proven and probable silver
mineral reserves by 22% and gold by 14%. In addition,
measured and indicated silver mineral resources increased
by 12% and inferred by 107%, while measured and indicated
gold mineral resources increased by 18% and inferred by 59%
-- all compared to year-end 2004 levels.
Fourth quarter silver production continued a trend of
successively higher quarterly production during 2005, and
was 18% above production in the first quarter of the year
due to improved grade.
Silver and gold production in the fourth quarter of 2005
were below the unusually high levels of the year-ago
quarter due to fewer tons mined.
-- Martha (Argentina)
Silver production in the fourth quarter of 2005 was up 9%
relative to the year-ago quarter. Silver cash cost per
ounce was generally consistent at $4.60 during the year.
Despite record production levels in 2005, Coeur increased
silver proven and probable mineral reserves at Martha
during the year, and more than doubled its inferred silver
mineral resource.
-- Endeavor (Australia)
Since Coeur's acquisition of the Endeavor mine's silver
reserves and production in May of 2005, the property
contributed 316,169 silver ounces at a low cash cost per
ounce of $2.05. Silver production in the fourth quarter of
2005 was affected by an uncontrolled rock fall that limited
mining activity and affected cash cost per ounce.
Coeur expects 2006 production to approach an annual rate of
approximately 1 million ounces, with more than half of that
amount coming in the second half of the year.
Year-ago comparisons for Endeavor are not meaningful
because the mineral interest was acquired in the second
quarter of 2005.
In addition to providing low-cost silver production,
Endeavor contributed more than 23 million ounces to Coeur's
proven and probable mineral reserves.
-- Broken Hill (Australia)
Since Coeur's acquisition of the Broken Hill mine's silver
reserves and production in September of 2005, the property
contributed 657,093 ounces of silver production at a low
cash cost per ounce of $2.72. Silver production in the
fourth quarter was 574,083 ounces.
Year-ago comparisons for Broken Hill are not meaningful
because the mineral interest was acquired in the third
quarter of 2005.
In addition to providing low-cost silver production, Broken
Hill contributed nearly 15 million ounces to Coeur's proven
and probable mineral reserves.
-- Rochester (Nevada)
This property had an exceptionally strong second half of
the year, with silver production 44% above that of the
first half of 2005, and gold production 48% above the level
of the first half. Additionally, silver cash cost per
ounce declined 52% during the second half of 2005, despite
an upward trend in the price of energy and steel. Silver
and gold production for the fourth quarter were modestly
below the levels of a year-ago due to fewer tons mined.
-- Galena (Coeur Silver Valley, Idaho)
Silver production for the fourth quarter of 2005 was below
that of the fourth quarter of 2004 due to lower than
expected ore grades and shorter vein lengths in certain
areas of the mine. The same factors caused an increase in
cash cost per ounce of silver for the fourth quarter of
2005 relative to the year-ago period. However, over the
course of the fourth quarter and into early 2006, Galena
has reported a trend of improved monthly production and
indications of higher ore grades. As previously disclosed,
the company is evaluating strategic alternatives for Galena
and the associated assets of Coeur Silver Valley. The
company has said those alternatives could include a
possible sale of this subsidiary.
Increase in Proven and Probable Silver Reserves
As of Jan. 1, 2006, the company's proven and probable silver
mineral reserves total 221.4 million ounces, a 13% increase
relative to the level of Jan. 1, 2005, largely due to increases
at the company's South American properties and the acquisitions
in Australia. Proven and probable gold mineral reserves at Jan.
1, 2006, were 1.3 million ounces, and the company remains
optimistic for expansion of gold reserves due to ongoing
exploration drilling at Kensington, where Coeur has focused on
further definition and expansion of its mineral resources and
reserves.
Capital Investment and Balance Sheet Highlights
The company had $240.4 million in cash and short-term
investments as of Dec. 31, 2005. Capital spending during the
fourth quarter of 2005 totaled $31.7 million, primarily
associated with the Kensington gold mine. For the full year
2005, capital investment totaled $116.8 million, primarily
associated with Kensington and the acquisitions of the Endeavor
and Broken Hill assets in Australia. The company currently
expects capital investment in 2006 to approximate $182 million,
primarily associated with Kensington, the resumption of a more
aggressive construction schedule at the San Bartolome silver
mine in Bolivia, and the remaining payment on the Endeavor
acquisition.
Update on Kensington Gold Project (Alaska)
As previously announced, the US Army Corps of Engineers
temporarily suspended the mine's Section 404. However, the
company has continued to conduct construction activities not
governed by the Section 404 permit. The company believes the
permit will be reinstated upon completion of the review, which
is expected in the first quarter of 2006.
Due to a broad increase in the cost of materials and supplies
impacting the industry in general, the company retained an
independent engineering firm to review its capital cost estimate
for Kensington during the fourth quarter of 2005. As a result
of increased earthwork requirements, increased storm water
management programs, the costs associated with challenges to the
project's permits, and the general increase in commodity prices,
the company currently estimates the total cost of construction
to be approximately $190 million. The project is expected to
have an annual production rate of 100,000 ounces and the
estimated cash operating cost per ounce is expected to be $250.
The company expects Kensington capital investment to total
approximately $77 million during 2006. The company currently
expects that Kensington can begin operations during 2007.
During the second half of 2005, the company began an extensive
exploration program at Kensington designed to increase the size
and geologic continuity of gold mineralization currently in
indicated and inferred mineral resources. The company completed
34,000 feet of core drilling from 74 drill holes. Of these
holes, 87% encountered gold mineralization equal to or greater
than 0.12 ounces per ton, the cut-off for its mineral resources.
In addition, 5,000 feet of core drilling was completed on its
adjacent Jualin property. The company continues to drill at
both properties and expects to update its mineral reserves and
mineral resources at Kensington during 2006 as information is
received.
Update on San Bartolome Silver Project (Bolivia)
An updated project review has confirmed the $135 million capital
cost estimates for the project, which is expected to produce 6
to 8 million annual ounces of silver at a cash cost of $3.50 per
ounce. The Bolivian national election was recently completed
without the necessity for a runoff, with the election of
President Evo Morales. The company is targeting mid-year 2006
as the date to resume full-scale construction activities at the
site. Additional construction work planned for the first half
of 2006 includes the construction of access roads to and around
the site, rough-cut grading of the mill site, construction of
ore stockpile areas, and the construction of a fence around the
perimeter of the plant site area.
Coeur d'Alene Mines Corporation -- http://www.coeur.com/-- is the
world's largest primary silver producer, as well as a significant,
low-cost producer of gold. The Company has mining interests in
Nevada, Idaho, Alaska, Argentina, Chile, Bolivia and Australia.
* * *
As reported in the Troubled Company Reporter on Oct. 4, 2004,
Standard & Poor's Ratings Services affirmed its 'B-' corporate
credit and senior unsecured debt ratings on Coeur D'Alene Mines
Corporation and removed the ratings from CreditWatch, where they
were placed on June 1, 2004, with positive implications. S&P said
the outlook is stable.
COLLINS & AIKMAN: Agrees to GE Capital's Tax Payment Request
------------------------------------------------------------
As reported in the Troubled Company Reporter on Nov. 16, 2005,
General Electric Capital Corporation sought to compel:
(a) Collins & Aikman Products Co. to pay almost $300,000 in
postpetition taxes; and
(b) the Becker Group, Inc., to make postpetition equipment
lease payments totaling almost $210,000.
To resolve the matter, the Debtors agree to grant GECC an
administrative claim for $277,332 in satisfaction of unpaid
amounts allegedly owed.
The Debtors will continue making payments due under the Leases
while they investigate whether the various equipment and aircraft
leases that is the subject of the Leases are true leases or
disguised financings. The Debtors reserve their rights to seek to
recharacterize or avoid the transactions that are the subject of
the Leases and any payments made under them.
Committee Objects
While the Official Committee of Unsecured Creditors supports the
Debtors' and GECC's efforts to reach mutually satisfactory
modifications to their business relationship, the Committee is
concerned of the absence of specific provisions in the Stipulation
like reserving the estates' rights to seek to recharacterize or
avoid the transactions and payments made.
The Committee is also troubled by the absence of a provision that
would condition the allowance of the Administrative Claim on
either (a) an agreement among the Debtors, the Committee and GECC
that the Equipment Lease is not a secured financing, or (b) entry
of a final order by the U.S Bankruptcy Court for the Eastern
District of Michigan that the Equipment Lease should not be
recharacterized as a secured financing.
Thus, the Committee ask the Court to condition approval of the
Stipulation on the inclusion of provisions ensuring that the
Debtors' rights, claims and defenses in respect of the
Transactions are preserved and enforceable against GECC and
extending those rights to the Committee in addition to the
Debtors.
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). Richard M. Cieri, Esq., at Kirkland & Ellis LLP,
represents C&A in its restructuring. Lazard Freres & Co., LLC,
provides the Debtor with investment banking services. Michael S.
Stammer, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents
the Official Committee of Unsecured Creditors Committee. 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.
(Collins & Aikman Bankruptcy News, Issue No. 27; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
COLLINS & AIKMAN: Balks at Pressure to Decide on Toyota Lease
-------------------------------------------------------------
Collins & Aikman Corporation and its debtor-affiliates ask the
U.S. Bankruptcy Court for the Eastern District of Michigan to deny
Toyota Motor Credit Corporation's request to compel the Debtors to
assume or reject an equipment lease under a Master Lease Agreement
dated Nov. 1, 1999.
The current deadline for the Debtors to assume or reject leases is
May 10, 2006. According to Ray C. Schrock, Esq., at Kirkland &
Ellis LLP, Toyota Motor Credit Corporation attempts to shorten the
deadline with respect to its equipment leases but has offered no
compelling reason that the Court should do so.
Mr. Schrock says the Debtors exhaustively have worked with TMCC to
resolve issues between them. The Debtors believe that TMCC's
request is a misguided attempt to use the Debtors' bankruptcy
filing to receive more than its bargained-for rights under the
Leases.
Mr. Schrock asserts that:
a. the Debtors are current on all postpetition amounts due
under the Leases and continue to maintain full coverage
insurance for the Equipment;
b. the Debtors provided TMCC with a list of plants that they
have announced would be closed. This list should enable
TMCC to confirm whether any of the Equipment is located at
those plants and take actions necessary to protect its
interest in the Equipment;
c. Although the Debtors' use of the Equipment may exceed the
hours set forth in the Leases in some instances, the Leases
explicitly contain hourly overtime charges to compensate
TMCC for that use.
The Official Committee of Unsecured Creditors agrees with the
Debtors' arguments.
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). Richard M. Cieri, Esq., at Kirkland & Ellis LLP,
represents C&A in its restructuring. Lazard Freres & Co., LLC,
provides the Debtor with investment banking services. Michael S.
Stammer, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents
the Official Committee of Unsecured Creditors Committee. 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.
(Collins & Aikman Bankruptcy News, Issue No. 27; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
CONSTAR INT'L: Lenders Waive Defaults & Alter Financial Covenants
-----------------------------------------------------------------
Constar International Inc. entered into an amendment and waiver to
its Credit Agreement dated as of February 11, 2005, with:
* Citicorp USA, Inc., as Administrative Agent, Swing Loan
Lender, and Lender;
* Wells Fargo Foothill, LLC, as Lender; and
* the State of California Public Employees' Retirement System,
as Lender.
In consideration of an $87,500 fee paid to the Lenders, the
Amendment:
-- deletes an interest coverage ratio covenant;
-- reduces the minimum Available Credit requirement from
$10,000,000 to $5,000,000;
-- adds a new requirement that the Company maintain minimum
Collateral Availability in excess of $20,000,000;
-- changes the Company's monthly reporting requirements; and
-- waives the delivery of monthly financial statements; and
-- adds a cure period for certain events of default.
The Credit Agreement is guaranteed by:
* Constar International U.K. Limited,
* Constar, Inc.,
* BFF Inc.,
* DT, Inc., and
* Constar Foreign Holdings, Inc.,
A full-text copy of the Amendment No. 3 and Waiver to Credit
Agreement is available at http://ResearchArchives.com/t/s?70aat
no extra charge.
Based in Philadelphia, Pennsylvania, Constar International --
http://www.constar.net/-- is a leading global producer of PET
(polyethylene terephthalate) plastic containers for food, soft
drinks and water. The Company provides full-service packaging
solutions, from product design and engineering, to ongoing
customer support. Its customers include many of the world's
leading branded consumer products companies.
* * *
As reported in the Troubled Company Reporter on Nov. 8, 2005,
Moody's Investors Service downgraded these ratings at the
conclusion of the review of Constar's ratings for possible
downgrade that was initiated on Sept. 21, 2005:
-- To B3 from B2 for the $220 million floating rate first
mortgage note, due 2012
-- To Caa3 from Caa1 for the $175 million 11% senior
subordinated note, due 2012
-- To B3 from B2 for the corporate family rating
The ratings outlook is negative.
As reported on the Troubled Company Reporter on Sept. 27, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Constar to 'B-' from 'B'. At the same time,
Standard & Poor's lowered its rating on the company's $220 million
senior secured notes to 'CCC+' from 'B-' and its rating on the
$175 million senior subordinated notes to 'CCC' from 'CCC+'. The
outlook is negative. Constar had approximately $457 million in
total debt outstanding at June 30, 2005.
CONSTAR INT'L: Reports $8.8 Million Fourth Quarter Loss
-------------------------------------------------------
Constar International Inc. (NASDAQ: CNST) disclosed its
financial results for the fourth quarter and twelve months ended
December 31, 2005.
Fourth Quarter Results
Net sales increased 13.6 percent in the fourth quarter of 2005 to
$229.3 million compared to $201.8 million in the fourth quarter of
2004. This increase reflects the pass-through of higher resin
prices, increased shipments of conventional and custom products
and favorable foreign currency translations. The increase in net
sales was partially offset by previously agreed to price
reductions implemented to extend key long-term contracts and meet
competitive pricing.
Gross profit in the fourth quarter of 2005 increased 13.6 percent
to $11.6 million from $10.2 million in the fourth quarter of 2004.
Depreciation of $6.0 million was $5.9 million lower in the quarter
compared to the fourth quarter of 2004 because of a lower asset
base (partially related to a 2005 third quarter non-cash asset
impairment charge) and because of adjustments to depreciation
estimates. Net of depreciation, gross profit in the fourth
quarter of 2005 was down $4.5 million compared to the fourth
quarter of 2004. This decrease reflects implementation of price
decreases, increased freight cost, softness in the Company's
European business and surges in resin and energy costs caused by
the hurricanes in the Gulf Coast. The decrease was partially
offset by increased unit sales, improved product mix, and better
operating efficiencies in the U.S. business.
Selling, administrative and research and development expenses
declined to $9.7 million in the fourth quarter of 2005 from
$10.1 million in the fourth quarter of 2004. The savings were
principally related to lower costs for Sarbanes-Oxley compliance
activity.
Interest expense in the fourth quarter of 2005 was $10.1 million
compared to $9.8 million in the prior year period as a result of
higher average borrowings.
Other expense for the fourth quarter of 2005 was $0.3 million
compared to other income of $25.0 million for the fourth quarter
of 2004. Other income in the fourth quarter of 2005 includes a
$1.5 million expense for settlement of a litigation matter.
Other income in the fourth quarter of 2004 included income of
$25.1 million for settlement of the OxbarT infringement suit.
The Company reported a net loss in the fourth quarter of
$8.8 million compared to a net profit of $11.5 million in the
fourth quarter of 2004. Excluding the impact of the $25.1 million
settlement income in 2004 and the $1.5 million settlement
expense in 2005, net loss decreased $6.4 million to a net loss of
$7.3 million in the fourth quarter of 2005 compared to a net loss
of $13.6 million in the fourth quarter of 2004.
Credit Agreement EBITDA in the fourth quarter declined to
$7.5 million from $38.2 million in the fourth quarter of 2004.
Excluding the impact of the $25.1 million settlement income in
2004 and the $1.5 million settlement expense in 2005, Credit
Agreement EBITDA in the fourth quarter decreased $4.1 million
to $9.0 million in the fourth quarter of 2005 compared to
$13.1 million in the fourth quarter of 2004. This decrease was
primarily due to lower gross profit excluding depreciation expense
and higher foreign currency adjustments, partially offset by
reduced operating expenses.
EBITDA is defined by the Company as net income (loss) before
interest expense, provision for income taxes, depreciation and
amortization. The Company's Credit Agreement adjusts EBITDA for
certain items. In the fourth quarter of 2005, these adjustments
were $0.7 million. In the fourth quarter of 2004, these
adjustments were $1.9 million.
Michael J. Hoffman, Constar's President and Chief Executive
Officer, commented, "In the fourth quarter of 2005, we experienced
one of the most volatile periods of cost changes in our history,
due mainly to the impact the Gulf Coast hurricanes had on the
petrochemical industry. Surges in energy and resin costs made it
difficult to manage the pass through of these increased costs to
our customers and we absorbed cost increases in excess of our
expectations. However, by the end of the quarter, we were passing
through a significant portion of these increases. Also promising
was our implementation of a strategic pricing initiative that
addressed margins in the customer contracts that were renewed
during the fourth quarter. Constar is committed to improving
operating performance, cash flow and liquidity while continuing to
provide quality products and service to its customers."
Full Year Results
Net sales increased 15.5 percent in 2005 to $975.0 million
compared to $844.2 million in 2004. This increase reflects the
pass-through of higher resin prices, increased shipments of
conventional and custom products and favorable foreign currency
translations. The increase in net sales was partially offset by
previously agreed to price reductions implemented to extend key
long-term contracts and meet competitive pricing.
Gross profit decreased $4.2 million, or 9.0 percent, to
$42.2 million in 2005 from $46.4 million in 2004. Gross profit,
net of depreciation expense, was $82.3 million in 2005 compared to
$97.5 million in 2004. Approximately $5.1 million of the decline
in gross profit is related to our European operations. Other
factors contributing to the decrease in gross profit were
previously agreed price concessions implemented to extend key
contracts and meet competitive pricing, higher resin costs, and
higher utility and shipping costs. These cost increases were
partially offset by increased unit sales, improved product mix and
reduced spending in warehousing and product handling costs.
Selling, administrative and research and development expenses
declined to $31.9 million in 2005 compared to $33.8 million in
2004. The savings were principally related to lower costs for
Sarbanes-Oxley compliance activity.
Other expense was $1.1 million in 2005 compared to other income
of $24.9 million in 2004. The change was principally due to the
$25.1 million litigation settlement recorded as other income in
2004 and a $1.5 million expense for a legal settlement in 2005.
The Company incurred non cash charges in 2005 of $22.2 million for
an asset impairment charge and $10.0 million for the write-off of
deferred financing costs and other fees.
Interest expense was $38.9 million in 2005 compared to
$39.8 million in 2004, reflecting lower interest rates that
were partially offset by higher average debt levels in 2005.
The Company reported a net loss of $60.0 million for 2005 compared
to a net loss of $6.8 million in 2004. Excluding the impact of
the $25.1 million legal settlement income in 2004, the non-cash
asset impairment charge of $22.2 million in 2005, the non-cash
write-off of deferred financing costs of $10.0 million in 2005
and the $1.5 million legal settlement expense in 2005, net
income increased $5.6 million to a net loss of $26.3 million or
$2.16 loss per diluted share in 2005 compared to a net loss of
$31.9 million or $2.65 loss per diluted share in 2004.
2005 Credit Agreement EBITDA was $51.6 million compared to
$90.8 million in 2004. Excluding the impact of the $25.1 million
settlement income in 2004 and the $1.5 million settlement expense
in 2005, Credit Agreement EBITDA decreased $12.7 million to
$53.1 million in 2005 compared to $65.7 million in 2004. This
$12.7 million decrease resulted from lower gross profit net of
depreciation partially offset with lower selling, administrative
and research and development expenses.
2005 Credit Agreement EBITDA adjustments were $36.3 million,
primarily composed of the $22.2 million non-cash asset impairment
charge related to European operations and $10.0 million for the
non-cash write-off of deferred financing costs at the time of the
Company's debt refinancing. 2004 Credit Agreement EBITDA
adjustments were $3.4 million. Credit Agreement EBITDA is not a
GAAP-defined measure and may not be comparable to adjusted EBITDA
as defined by other companies. Management believes that
investors, analysts and other interested parties view our ability
to generate Credit Agreement EBITDA as an important indicator of
our operating performance. Management also believes that Credit
Agreement EBITDA is a useful measure in understanding trends
because it eliminates various non-operational and non-recurring
items. In addition, Credit Agreement EBITDA facilitates
comparisons to operating performance in prior periods, and is used
by the Company in setting incentive plan targets.
Based in Philadelphia, Pennsylvania, Constar International --
http://www.constar.net/-- is a leading global producer of PET
(polyethylene terephthalate) plastic containers for food, soft
drinks and water. The Company provides full-service packaging
solutions, from product design and engineering, to ongoing
customer support. Its customers include many of the world's
leading branded consumer products companies.
* * *
As reported in the Troubled Company Reporter on Nov. 8, 2005,
Moody's Investors Service downgraded these ratings at the
conclusion of the review of Constar's ratings for possible
downgrade that was initiated on Sept. 21, 2005:
-- To B3 from B2 for the $220 million floating rate first
mortgage note, due 2012
-- To Caa3 from Caa1 for the $175 million 11% senior
subordinated note, due 2012
-- To B3 from B2 for the corporate family rating
The ratings outlook is negative.
As reported on the Troubled Company Reporter on Sept. 27, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Constar to 'B-' from 'B'. At the same time,
Standard & Poor's lowered its rating on the company's $220 million
senior secured notes to 'CCC+' from 'B-' and its rating on the
$175 million senior subordinated notes to 'CCC' from 'CCC+'. The
outlook is negative. Constar had approximately $457 million in
total debt outstanding at June 30, 2005.
CRI RESOURCES: Court Okays Advanced Insurance as Insurance Expert
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
in Los Angeles authorized CRI Resources Inc. to retain Advanced
Insurance Management as its insurance expert.
As reported in the Troubled Company Reporter on March 6, 2006, the
Debtor tapped Advanced Insurance to provide expert advice in
connection with the analysis and adjudication of alleged claims
asserted by National Union Fire Insurance Company.
Edward J. Priz, the president at Advanced Insurance, is one of the
lead professionals from his Firm performing services to the
Debtor. Mr. Priz disclosed that Advanced Insurance received a
$3,000 retainer. Mr. Priz charges $150 per hour for his services.
Headquartered in Los Angeles, California, CRI Resources Inc.
provides demolition services. The Company filed for chapter 11
protection on March 1, 2005 (Bankr. C.D. Calif., L.A. Div., Case
No. 05-13899). Stephen F. Biegenzahn, Esq., at Biegenzahn
Weinberg represents the Debtor's restructuring. When the Company
filed for protection from its creditors, it listed total assets of
$5,243,614 and total debts of $43,078,461.
CSK AUTO: S&P Puts B+ Corporate Credit Rating on Negative Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on
CSK Auto Inc., including the 'B+' corporate credit rating, on
CreditWatch with negative implications.
This action follows the Phoenix, Arizona-based company's
announcement that it has uncovered accounting irregularities and
will postpone the release of its 2005 fourth-quarter results.
CSK Auto does not yet know which periods it will need to restate,
or by how much. Moreover, high debt to EBITDA levels may persist
longer than expected, given the company's softer-than-anticipated
performance. Management provided guidance that same-store sales
for the fourth quarter were roughly flat.
"Given the uncertainty of the company's historical financial
statements and ineffective internal controls, we are unable to
gauge the potential impact on the credit ratings," said Standard &
Poor's credit analyst Stella Kapur.
While CSK Auto anticipates that the accounting errors and
irregularities are related mainly to its inventories and vendor
allowances, Standard & Poor's believes that these restatements
will also likely impact the company's historical costs of goods
sold and overall profitability levels. Standard & Poor's will
closely monitor developments on the company's financial
restatements.
CURATIVE HEALTH: Files for Chapter 11 Protection in New York
------------------------------------------------------------
Curative Health Services, Inc., aka Curative Health Services
Parent Holding Company, and 14 of its subsidiaries filed for
Chapter 11 protection with the U.S. Bankruptcy Court for the
Southern District of New York on March 27, 2006.
A Case Summary providing details extracted from the Debtors'
chapter 11 petitions and a list of the Debtors' 41-largest
unsecured creditors appeared in yesterday's edition of the
Troubled Company Reporter.
The Debtors commenced bankruptcy proceedings pursuant to an
agreement with members of an Ad Hoc Committee collectively holding
approximately 78.8% of Curative's $185 million 10-3/4% Senior
Notes due 2011 to support a consensual financial restructuring of
the company through a pre-arranged chapter 11 plan of
reorganization.
Liquidity Issues
Curative, through its subsidiaries, operates a Specialty Infusion
business unit and a Wound Care Management business unit to treat
patients suffering from serious acute or chronic medical
conditions.
Since June 2004, the Debtors have faced various issues that
negatively affected its liquidity and its ability to pay its
debts. Revenue declined as a result of:
-- the State of California's move to reduce blood-product
reimbursement;
-- the federal government's reduction in blood-product
reimbursement;
-- poor performance of its new branches; and
-- the resignation of certain customer sales and service
representatives.
In addition to weakening sales, the Debtors also face potential
claims from three independent retail California pharmacies that
the Department of Health Services charged with improper
reimbursement. The pharmacies, which sourced certain products
from Apex and eBioCare, has informed the Debtors that they would
seek indemnification if the DHS requires them to return any
overpayments. Apex and eBioCare estimate the range of loss to be
anywhere from zero to $39.3 million.
Debt Defaults
Curative issued the Senior Notes on April 23, 2004, in connection
with the purchase of Critical Care Systems, Inc. The Company
defaulted on approximately $9.9 million of interest payments due
under the Notes on Nov. 30, 2005. As of March 15, 2006,
approximately $185 million in aggregate principal amount and
approximately $16.4 million in accrued interest were due and
outstanding on the Senior Note.
Curative's Senior Note default also triggered a default under its
Existing Credit Facility with General Electric Capital
Corporation. As of March 15, 2006, approximately $31.3 million
was drawn and outstanding under the Existing Credit Facility.
Under the terms of a forbearance agreement with the Debtors, GE
agreed to waive conditional forbearance fees resulting from the
default. GE will also extend debtor-in-possession and exit
financing on behalf of the Debtors.
Prepackaged Plan
John C. Prior, Curative Health Services, Inc.'s Chief Operating
Officer, tells the Bankruptcy Court that the Prepackaged Plan
achieves a consensual de-leveraging of the Debtors' consolidated
balance sheet and ensures that the Debtors will be private
companies upon emergence from bankruptcy protection.
The Prepackaged Plan includes, among other things, these key
terms:
-- Administrative Expense Claims and Priority Tax Claims will
be unimpaired;
-- Secured Bank Claims will be paid in full from the proceeds
of the DIP Financing;
-- Curative Other Secured Claims, Apex Other Secured Claims
and eBioCare Other Secured Claims will be unimpaired;
-- Curative Other Priority Claims, Apex Other Priority Claims
and eBioCare Other Priority Claims will be unimpaired;
-- each holder of a Senior Note Claim will receive a cash
payment of approximately 54.9% of its Senior Note Claim,
unless a holder of a Senior Note Claim:
a) is an accredited investor or qualified
institutional buyer;
b) holds Senior Notes in an aggregate principal face
amount equal to or greater than $1 million; and
c) elects to receive its Pro Rata Share of New CURE
Stock and Cash Consideration the value of which, on
the Effective Date, will not exceed approximately
54.9% of such holder's Senior Note Claim;
-- each holder of a Curative General Unsecured Claim, Apex
General Unsecured Claim and/or eBioCare General Unsecured
Claim will receive a promissory note in face amount equal
to approximately 56.0%, 5.2% and 5.9% of its respective
Curative General Unsecured Claim, Apex General Unsecured
Claim or eBioCare General Unsecured Claim, unless the
holder elects to receive a cash payment in an amount equal
to 50% of the face amount of such holder's applicable
promissory note;
-- Intercompany Claims will be extinguished or cancelled by
setoff, contribution or other method determined by the
Debtors;
-- Equity Interests will be cancelled;
-- 100% of the New CURE Stock will be held by Electing Senior
Noteholders and certain Rights Holders; and
-- Executory contracts and unexpired leases will be assumed.
On Feb. 6, 2006, the Debtors circulated the Disclosure Statement
in support of the Prepackaged Plan. Mr. Prior says that the
Debtors have obtained the requisite votes to confirm the
Prepackaged Plan and they intend to proceed towards swift
confirmation of the Plan.
A full-text copy of the Debtors' Disclosure Statement explaining
their Prepackaged Joint Chapter 11 Plan of Reorganization is
available for a fee at:
http://www.researcharchives.com/bin/download?id=060328040454
Headquartered in Nashua, New Hampshire, Curative Health Services,
Inc. -- http://www.curative.com/-- provides Specialty Infusion
and Wound Care Management services. The company and 14 of its
affiliates filed for chapter 11 protection on Mar. 27, 2006
(Bankr. S.D.N.Y. Lead Case No. 06-10552). Brian E. Greer, Esq.,
and Martin N. Flics, Esq., at Linklaters, represent the Debtors in
their restructuring efforts. The Debtors financial condition as
of Sept. 30, 2005 showed $155,000,000 in total assets and
$255,592,000 in total debts.
DANA CORP: Ad Hoc Panel Balks at Restricted Stock & Debt Trading
----------------------------------------------------------------
As reported in the Troubled Company Reporter on Mar. 22, 2006,
Dana Corporation and its debtor-affiliates sought and obtained
permission on an interim basis from the U.S. Bankruptcy Court for
the Southern District of New York, to establish notification and
hearing procedures on claim and equity security transfers.
The Trading Procedures reaped objection from an ad hoc committee
of certain holders of Dana Corp. unsecured notes.
The Ad Hoc Committee complains that the Trading Procedures place
extreme burdens on claimholders and would effectively halt all
transactions in Claims by Substantial Claimholders.
Kristopher M. Hansen, Esq., at Stroock & Stroock & Lavan LLP, in
New York, argues that the Debtors have failed to provide any
evidentiary basis to establish that the extraordinary limitations
on the public markets are warranted.
Mr. Hansen notes that in a press release dated January 17, 2006,
in connection with a valuation allowance made by the Debtors in
October 2005, it was reported that "Dana believes it is no longer
more likely than not that the company will be able to utilize
[its deferred tax assets]." The Debtors' own words, according to
Mr. Hansen, admit of the fact that the relief the Debtors seek
will result in only one benefit to the Debtors -- control over
parties seeking to aggregate large debt positions against the
Debtors and take control over a reorganization process designed
primarily for their benefit.
Mr. Hansen argues that the Debtors fail to establish that prior
restraints on the trading of Claims by Substantial Claimholders
are necessary to achieve the goal of preserving NOLs. In
addition, the Debtors present no evidence that that the Debtors'
estates would ultimately be able to realize any value from these
tax attributes at all.
On the other hand, the likely effect of the system proposed by
the Debtors would be to shift the balance of control between the
Debtors and creditors in connection with the formulation, voting
and eventual confirmation of a proposed plan of reorganization by
permitting the Debtors to exert total control over the
accumulation of Claims, Mr. Hansen avers.
Moreover, the Debtors' request also fails to meet the standards
for injunctive relief, particularly of the magnitude requested.
Mr. Hansen asserts that the Debtors must commence an adversary
proceeding and provide proof, in an evidentiary hearing, that the
NOLs exist, that the NOLs have a readily ascertainable value, and
that there is a strong likelihood that they will be available in
the future for use to support a confirmable plan that satisfies
the myriad requirements of Section 382(l)(5) of the Internal
Revenue Code.
Even if the Debtors are capable of presenting evidence that the
NOLs exist, and the Court is satisfied that restrictions on the
trading of claims are necessary, the Ad Hoc Committee maintains
that the far overreaching terms of the Trading Procedures is
inappropriate.
The Ad Hoc Committee asks the Court to approve a more narrowly
tailored set of procedures.
The members of the Ad Hoc Committee hold Dana 6.5% Notes Due
2008, 6.5% Notes Due 2009, 9.0% Notes Due 2011, 5.58% Notes Due
2015, 7% Notes Due 2028, and 7% Notes Due 2029. As of the
Petition Date, they hold approximately 38% of the aggregate
outstanding principal amount of the Debtors' bond obligations.
More Objections
A) Wilmington Trust
Wilmington Trust Company, the indenture trustee for more than
$1.6 billion principal amount of outstanding bonds issued by Dana
Corp., asserts that the Debtors' request should be denied
on these grounds:
(1) The vast majority of the bondholders have not been
provided notice of the Debtors' request, yet the
requested relief will significantly impact the value of
all of the outstanding bonds;
(2) The Trading Procedures would preclude large bondholders or
groups from negotiating the terms of a reorganization plan
with the Debtors and taking other active positions in the
Debtors' Chapter 11 cases, even though the holders are
likely to become the owners of the reorganized company and
will be the parties most affected by the management's
decisions throughout the bankruptcy cases;
(3) The Debtors have failed to offer any evidence as to the
true value of the NOLs they purportedly seek to protect or
of their ability to utilize them to offset post-
reorganization income; and
(4) The Debtors have failed to properly bring their request in
the context of a properly filed adversary proceeding.
B) Market Maker Objectors
Citigroup Inc., JPMorgan Chase & Co., Lehman Brothers Inc.,
Merrill Lynch & Co., Morgan Stanley & Co., Inc., and UBS
Securities LLC, assert that they and other parties-in-interest
should be given ample time to review the Trading Procedures before
the Court restrains the public securities markets.
Citigroup et al., are registered broker dealers, actively
participating in the debt markets, buying and selling debt
claims, including Dana Debt Claims.
The Market Maker Objectors believe that immediate injunctive
relief relating to the Dana Debt Claims to protect the Debtors'
NOLs is inappropriate and not supported by the law or the facts.
James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton LLP,
in New York, explains that the Debtors could still retain the
ability to utilize Section 382(l)(5) by seeking to require
holders of Dana Debt Claims to dispose of claims prior to the
consummation of a plan of reorganization as necessary to bring
those holders below the 5% threshold for post-plan equity
ownership. The sell-down remedy has been advocated by The Bond
Market Association and the Loan Syndications and Trading
Association -- two leading credit market organizations -- as a
reasonable compromise that balances the interests of debtors and
the trading markets while eliminating the risk of litigation.
Mr. Bromley relates that the Market Maker Objectors argued
successfully to limit NOL-based trading restrictions in the
recent Chapter 11 proceedings of Northwest Airlines Corporation,
Delta Air Lines, Inc., and Delphi Corporation. Through the
Objectors' efforts, the sell-down remedy eventually was adopted
in each of the Northwest, Delta and Delphi cases, reversing the
very draconian relief that was sought in those cases on an
emergency basis.
Mr. Bromley further points out that the Debtors have proposed a
modified sell-down remedy, admitting that debt trading prior to
consummation is not per se harmful. Given the Debtors' general
support of a sell down remedy, therefore, there is no legal,
financial or logical justification to impose significant
restrictions on purchases and sales of Dana Debt Claims.
Additionally, Mr. Bromley reminds the Court that under a special
elective regime provided by Section 382(l)(5), a debtor's ability
to utilize NOLs will not be limited by Section 382 on a going-
forward basis if these four conditions are met:
1. As a result of the reorganization, at least 50% of the
reorganized debtor's stock is owned by former shareholders
of the corporation or "qualified creditors." The term
"qualified creditors" as a general matter includes:
(i) creditors that have owned their debt claims for at
least 18 months prior to the bankruptcy filing
date;
(ii) any market purchaser of debtor claims that will
hold less than 5% of the equity of the debtor
following the reorganization; and
(iii) trade creditors;
2. The debtor does not undergo any subsequent "ownership
change" during the two years following the consummation of
the plan of reorganization. If a corporation fails this
requirement after availing itself of the benefits of
Section 382(l)(5), the corporation's pre-change NOLs will
Be completely eliminated, not just subject to the general
Section 382 limitations;
3. The debtor does not take a tax deduction for any interest
paid or accrued during a period ranging from three to four
years immediately preceding the consummation of the plan
of reorganization in respect of debt that is later
converted into stock pursuant to the plan; and
4. The debtor effectively elects to rely on Section
382(l)(5).
"Market trading in Dana Debt Claims after the Petition Date
cannot cause the Debtors to fail to meet [these] requirements,
and thus cannot cause the Debtors to lose the benefits of Section
382(l)(5) (should they elect to employ it), prior to the exchange
of such Dana Debt Claims for stock upon a consummation of a plan
of reorganization," Mr. Bromley tells the Honorable Burton R.
Lifland.
Mr. Bromley also notes that the entire regime of orders
protecting NOLs is based on a single case, a generation-old
Second Circuit decision, In re Prudential Lines Inc., 928 F.2d
565 (2d Cir. 1991), aff'g 119 B.R. 430 (S.D.N.Y. 1990), aff'g 107
B.R. 832 (Bankr. S.D.N.Y. 1989), the sui generis facts of which
have no application to the current situation.
According to Mr. Bromley, Judge Easterbrook's recent opinion in
In re UAL Corp., 412 F.3d 775 (7th Cir. 2005), flatly contradicts
the Debtors' contention that claims trading constitutes an act to
obtain possession of or exert control over property of the estate
-- the only acts proscribed by Section 362(a)(3) of the
Bankruptcy Code.
Mr. Bromley also notes that the relief sought by the Debtors is
injunctive in nature and must be sought by the commencement of an
adversary proceeding. The Debtors must also be required to
provide strong proof in an evidentiary hearing held on notice
and with an opportunity for discovery and effective cross-
examination, that the NOLs exist, that the NOLs have a readily
ascertainable value, and that there is a strong likelihood that
they will be available in the future for use to support a
confirmable plan that satisfies the limitations of Section
382(l)(5).
Dana reports general unsecured claims of $2.25 billion. However,
according to Mr. Bromley, given the high likelihood of additional
substantial claims being asserted, the threshold established in
the Procedures is artificially low and overly restrictive for
holders of Dana Debt Claims.
Headquartered in Toledo, Ohio, Dana Corporation --
http://www.dana.com/-- designs and manufactures products for
every major vehicle producer in the world, and supplies
drivetrain, chassis, structural, and engine technologies to those
companies. Dana employs 46,000 people in 28 countries. Dana is
focused on being an essential partner to automotive, commercial,
and off-highway vehicle customers, which collectively produce more
than 60 million vehicles annually. Corinne Ball, Esq., and
Richard H. Engman, Esq., at Jones Day, in Manhattan and
Heather Lennox, Esq., Jeffrey B. Ellman, Esq., Carl E. Black,
Esq., and Ryan T. Routh, Esq., at Jones Day in Cleveland, Ohio,
represent the Debtors. Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor and investment
banker. Ted Stenger from AlixPartners serves as Dana's Chief
Restructuring Officer. When the Debtors filed for protection
from their creditors, they listed $7.9 billion in assets and
$6.8 billion in liabilities as of Sept. 30, 2005. (Dana
Corporation Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
DANA CORP: Pays Sypris $12 Mil. to Continue Postpetition Supply
---------------------------------------------------------------
As reported in the Troubled Company Reporter on Mar. 14, 2006,
Dana Corporation and its debtor-affiliates sought and obtained
authority from the U.S. Bankruptcy Court for the Southern District
of New York, to pay prepetition foreign vendors claims. The
Debtors estimated that the maximum amount to be paid to Foreign
Vendors is approximately $79,500,000.
The Debtors informed the Court that Sypris Technologies, Inc.
refused to perform its postpetition obligations under an executory
contract due to the Debtors' failure to pay the vendor's
prepetition claim.
The Debtors conditionally paid Sypris' $12,000,000 claim to ensure
the uninterrupted flow of the vendor's products.
Sypris provides parts for all of Dana Corp.'s commercial vehicle
applications as well as light vehicle operations. In 2005, Dana
purchased over $110,000,000 in products from Sypris.
The Debtors asked the Court to direct Sypris to show cause why
they should not be held in violation of Sections 362 and 365 of
the Bankruptcy Code and why it should not be compelled to return
the Provisional Payment.
Settlement Discussions
The Debtors engaged in negotiations with Sypris. Subsequently,
the Court signed an agreed temporary restraining order directing
Sypris to comply with and fulfill all contractual obligations to
the Debtors and their affiliates, including, without limitation,
by providing 45-day payment terms to the Debtors and their
affiliates and by providing goods to all locations of the Debtors
and their affiliates on a timely basis.
To the extent necessary to ensure timely delivery of goods to the
Debtors and their affiliates, Sypris will use premium shipping at
its sole cost. Sypris may file an administrative claim for any
additional premium shipping costs, and the Debtors reserve the
right to contest any claim. The Debtors and their affiliates
likewise will provide premiums shipping at their own cost to the
extent necessary to meet delivery schedules to Sypris.
Headquartered in Toledo, Ohio, Dana Corporation --
http://www.dana.com/-- designs and manufactures products for
every major vehicle producer in the world, and supplies
drivetrain, chassis, structural, and engine technologies to those
companies. Dana employs 46,000 people in 28 countries. Dana is
focused on being an essential partner to automotive, commercial,
and off-highway vehicle customers, which collectively produce more
than 60 million vehicles annually. Corinne Ball, Esq., and
Richard H. Engman, Esq., at Jones Day, in Manhattan and
Heather Lennox, Esq., Jeffrey B. Ellman, Esq., Carl E. Black,
Esq., and Ryan T. Routh, Esq., at Jones Day in Cleveland, Ohio,
represent the Debtors. Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor and investment
banker. Ted Stenger from AlixPartners serves as Dana's Chief
Restructuring Officer. When the Debtors filed for protection
from their creditors, they listed $7.9 billion in assets and
$6.8 billion in liabilities as of Sept. 30, 2005. (Dana
Corporation Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
DELTA AIRLINES: Wants to Walk Away from Delta Stock Option Pact
---------------------------------------------------------------
Delta Air Lines, Inc. and its debtor-affiliates ask the United
States Bankruptcy Court for the Southern District of New York for
authority to reject an executory contract governing certain Delta
Stock Options pursuant to Section 365(a) of the Bankruptcy Code.
The Debtors tell the Court that prior to filing for bankruptcy,
they issued option-based instruments to their employees and
directors, the value of which is keyed to the value of Delta Air
Lines, Inc.'s common stock. These instruments include restricted
stock, non-qualified stock options, stock appreciation rights, and
deferred common stock.
Approximately 93,000,000 Delta Stock Options remain outstanding,
held by approximately 70,000 current and former employees and
directors, and their transferees.
The Debtors relate that the Delta Stock Options have exercise
prices ranging from $2.97 to $62.63 per share. However, because
the market price of Delta's common stock has remained below $1.00
per share at all times since the Sept. 14, 2005, the Delta Stock
Options have little or no economic value.
For 2006, the Debtors expect to incur $305,000 for maintaining,
administering and accounting for the Delta Stock Options. The
Debtors will also incur additional costs associated with new
accounting procedures required in 2006 and thereafter.
Limit Notice of Rejection
Under the Case Management Order, the Debtors may be required to
serve all 70,000 Option Holders with the Rejection Motion,
notwithstanding the public availability of the document.
However, the Debtors are wary that many Option Holders might not
be in a position to understand the effect of the Rejection
Motion, the terms of which were not drafted for an audience of
laypersons. Many of the Option Holders might well believe that
they must respond to the Rejection Motion, causing needless
concern and generating unnecessary paperwork.
In light of the almost-certain reality that the Delta Stock
Options have no practical economic value, and that their
rejection will have no impact on the Option Holders, the Debtors
sought and obtained the Court's consent to serve the Rejection
Motion only on:
(i) the nine Option Holders that each individually hold at
least 250,000 Delta Stock Options;
(ii) the Air Line Pilots Association, International, which
represents holders of approximately one-third of the Delta
Stock Options; and
(iii) the Official Committee of Unsecured Creditors, which
represents the interests of the unsecured creditors group
as a whole.
Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners. The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts. Timothy R. Coleman at The Blackstone Group
L.P. provides the Debtors with financial advice. Daniel H.
Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss
Hauer & Feld LLP, provide the Official Committee of Unsecured
Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey
Howard & Zukin Capital and James S. Feltman at Mesirow Financial
Consulting, LLC, serve as the Committee's financial advisors. As
of June 30, 2005, the Company's balance sheet showed $21.5 billion
in assets and $28.5 billion in liabilities. (Delta Air Lines
Bankruptcy News, Issue No. 25; Bankruptcy Creditors' Service,
Inc., 215/945-7000).
DELTA AIRLINES: Wants Until May 31 to File Schedules
----------------------------------------------------
Delta Air Lines, Inc. and its debtor-affiliates ask the United
States Bankruptcy Court for the Southern District of New York to
further extend until May 31, 2006, their deadline to file
schedules of assets and liabilities, schedules of current income
and expenditures, schedules of executory contracts and unexpired
leases, and statements of financial affairs.
The Debtors tell the Court that they have consulted the U.S.
Trustee and the Official Committee of Unsecured Creditors and both
have given their consent to the extension.
The Debtors say that they Debtors need to compile enormous
information to prepare their Schedules. The Debtors have mailed
notices to more than 350,000 potential creditors, and anticipate
listing in their Schedules nearly 18,000 executory contracts, 750
pending litigations and more than 10,000 payments made within 90
days prior to filing for bankruptcy. When completed, the Debtors'
Schedules will be approximately 6,500 pages long. Given the
enormity of the task of reviewing and compiling all of the data,
the Debtors believe that it would be difficult for them to
properly and accurately complete the Schedules in time to meet the
March 28, 2006 deadline.
Additionally, numerous significant business and legal issues have
arisen in just the past few months that have required and will
continue to require a great deal of attention, Mr. Huebner
relates. The Debtors' employees and professionals have recently
devoted much time and effort to:
(i) address issues raised by numerous airport lessors and
holders and trustees of airport-related financial
instruments and analyzing the Debtors' airport leases and
financings to permit future planning of these leases and
financings;
(ii) address more than 80 filed reclamation claims, totaling
$15,787,048;
(iii) enforce the automatic stay against numerous creditors
seeking to contravene the mandates of the Bankruptcy Code;
(iv) prepare for and defend against several high stakes
litigations, in which counterparties alleged postpetition
damages or claims in the hundreds of millions of dollars;
(v) Section 1113 negotiations with Delta Air Lines, Inc.'s
pilots union and Comair, Inc.'s flight attendants union
and preparing for related proceedings regarding both;
(vi) analyze a significant number of nonresidential real
property leases and executory contracts in order to
determine whether to assume or reject them; and
(vii) continue to evaluate the Debtors' many aircraft financing
arrangements in light of Bankruptcy Code section 1110 and
conducting negotiations with numerous counterparties.
Moreover, the Debtors have lost several important personnel in
the last two months, including their Senior Vice President of
Restructuring.
Mr. Huebner also notes that Northwest Airlines Corporation and
its subsidiaries, which filed Chapter 11 petitions within minutes
of the Debtors, were recently granted an extension of the
deadline to file their Schedules until May 1, 2006.
Mr. Huebner points out that the Debtors are much larger than
Northwest Airlines, thereby making the preparation of their
extensive Schedules more arduous and time-consuming. By many
metrics, including both assets and liabilities, the Debtors are
more than 50% bigger than Northwest. Still, despite being
considerably larger than Northwest, the Debtors are asking for
only a few weeks more than Northwest has already been granted in
which to file their Schedules.
Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners. The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts. Timothy R. Coleman at The Blackstone Group
L.P. provides the Debtors with financial advice. Daniel H.
Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss
Hauer & Feld LLP, provide the Official Committee of Unsecured
Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey
Howard & Zukin Capital and James S. Feltman at Mesirow Financial
Consulting, LLC, serve as the Committee's financial advisors. As
of June 30, 2005, the Company's balance sheet showed $21.5 billion
in assets and $28.5 billion in liabilities. (Delta Air Lines
Bankruptcy News, Issue No. 25; Bankruptcy Creditors' Service,
Inc., 215/945-7000).
DELTA AIRLINES: Section 341(a) Meeting Adjourned Sine Die
---------------------------------------------------------
Deirdre A. Martini, the U.S. Trustee for Region 2, tells the U.S.
Bankruptcy Court for the Southern District of New York that she
did not object to Delta Air Lines, Inc. and its debtor-affiliates'
request to extend until May 31, 2006, their deadline to file
schedules and statements of financial affairs.
Consequently, Ms. Martini adjourned the Section 341 meeting of the
Debtors' creditors at a date yet to be determined.
The Sec. 341 Meeting of Creditors is required 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 Atlanta, Georgia, Delta Air Lines --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners. The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts. Timothy R. Coleman at The Blackstone Group
L.P. provides the Debtors with financial advice. Daniel H.
Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss
Hauer & Feld LLP, provide the Official Committee of Unsecured
Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey
Howard & Zukin Capital and James S. Feltman at Mesirow Financial
Consulting, LLC, serve as the Committee's financial advisors. As
of June 30, 2005, the Company's balance sheet showed $21.5 billion
in assets and $28.5 billion in liabilities. (Delta Air Lines
Bankruptcy News, Issue No. 25; Bankruptcy Creditors' Service,
Inc., 215/945-7000).
DIVERSIFIED FIN'L: Sept. 30 Balance Sheet Upside-Down by $2 Mil.
----------------------------------------------------------------
Diversified Financial Resources Corporation reported its restated
financial statements for the quarter ended Sept. 30, 2005, to the
Securities and Exchange Commission on March 13, 2006.
The Company filed an amended quarterly report to restate its 2003
financial statements to correct an error made while recording the
acquisition of Wichita Development Corporation.
The restated 2003 statements increased the net loss by $1 million
and established the purchase price payable liability of
$1 million. The effect of the restatement in those financial
statements is that the accumulated deficit for 2004 and 2003
increased by $1 million and the purchase price payable liability
for $1 million is reflected on the balance sheets for 2005.
For the three months ended Sept. 30, 2005, Diversified Financial
earned $687,375 in net income, compared to a $1,081,958 net loss
for the three months ended Sept. 30, 2004. For the quarters ended
Sept. 30, 2005 and 2004, the Company did not report any revenues.
As of Sept. 30, 2005, Diversified Financial's balance sheet shows
a $2,200,000 negative working capital balance.
At Sept. 30, 2005, Diversified Financial's balance sheet showed
$418,883 in total assets and $2,345,007 in total liabilities. The
Company reports a $20,913,203 accumulated deficit at Sept. 30,
2005.
A full-text copy of Diversified's latest quarterly report is
available for free at http://ResearchArchives.com/t/s?712
Going Concern Doubt
Mendoza Berger & Company, LLP expressed substantial doubt about
Diversified Financial's ability to continue as a going concern
after auditing the Company's financial statements for the year
ended Dec. 31, 2004. The auditing firm pointed to the Company's
recurring losses and stockholders' equity deficit.
Headquartered in San Diego, California, Diversified Financial
Resources Corporation is currently a holding company with real
estate investment operations. The Company's plan is to create and
manage a diverse comprehensive portfolio of companies operating in
several industries. Currently, Diversified Financial is focusing
its resources on two industry sectors, including Land and Natural
Resources and Real Estate Investments. The Company is currently
in the process of fully developing its business plan.
As of Sept. 30, 2005, Diversified Financial's stockholders' equity
deficit narrowed to $1,926,124, from $2,107,745 at Dec. 31, 2004.
DUO DAIRY: Ch. 7 Trustee Hires Allen & Vellone to Sue Bank Lender
-----------------------------------------------------------------
Dennis W. King, the chapter 7 Trustee overseeing the liquidation
of Duo Dairy, Ltd., LLP, sought and obtained authority from the
U.S. Bankruptcy Court for the District of Colorado to employ
Allen & Vellone, P.C., as his special counsel, nunc pro tunc to
Mar. 3, 2006.
Allen & Vellone is expected to investigate, and if necessary,
pursue potential lender liability claims or actions against the
Debtor's primary secured lender, American National Bank.
Mr. King tells the Court that the lead attorneys in this
engagement are Patrick D. Vellone, Esq., and Mark A. Larson, Esq.
Mr. King discloses that Mr. Vellone bills $325 per hour and Mr.
Larson bills $180 per hour.
Mr. Vellone, shareholder of Allen & Vellone, assures the Court
that the Firm is "disinterested" as that term is defined in
Section 101(14) of the Bankruptcy Code.
Mr. Vellone can be reached at:
Patrick D. Vellone, Esq.
Allen & Vellone, P.C.
1600 Stout Street, Suite 1100
Denver, Colorado 80202
Tel: (303) 534-4499
Fax: (303) 893-8332
Headquartered in Loveland, Colorado, Duo Dairy, LTD., LLP, filed
for chapter 11 protection on March 12, 2004 (Bankr. D. Colo. Case
No. 04-14827). The case was converted to chapter 7 on October 27,
2004, and Dennis W. King was appointed as the Chapter 7 Trustee to
oversee the company's liquidation. Douglas C. Pearce II, Esq., at
Connolly, Rosania & Lofstedt, PC, represents the Chapter 7
Trustee. William A. Richey, Esq., at Weinman & Associates, P.C.,
represents the Debtor. Alan K. Motes , Esq., represents the
Official Committee of Unsecured Creditors. When the Debtor filed
for protection from its creditors, it estimated assets and debts
between $10 million and $50 million.
EDDIE BAUER: S&P Downgrades Corporate Credit Rating to B from B+
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on specialty apparel retailer Eddie Bauer Holdings Inc.
and the bank loan rating on Eddie Bauer Inc. (Eddie Bauer) to 'B'
from 'B+'. The outlook is negative.
The rating action is based on much weaker-than-anticipated
operating results for the fourth quarter ended Dec 31, 2005, and
deteriorating credit measures.
"We believe that merchandising issues remain very challenging for
Eddie Bauer, and that sales trends will be under pressure through
the first half of 2006," said Standard & Poor's credit analyst Ana
Lai.
Based on its weak performance, there is a likelihood that the
company may not be in compliance with financial covenants under
its senior secured term loan for the quarter ending
March 31, 2006.
The rating on Redmond, Washington-based Eddie Bauer Holdings
reflects:
* its poor operating performance since its emergence from
bankruptcy in June 2005;
* a weakening financial profile; and
* its participation in the highly competitive and fragmented
specialty apparel retailing industry, which is characterized
by substantial seasonality and fashion risk.
These risks are tempered by Eddie Bauer's recognized brand and
diversified distribution channels.
Operating results have been much weaker than expected since Eddie
Bauer emerged from bankruptcy in June 2005. Sales at its retail
and direct channels declined in the important fourth quarter ended
Dec. 31, 2005, due to merchandising mistakes in its redesigned
fall apparel lines. Comparable-sales at the retail channel
declined 4.3% in the third quarter ended September 2005, and
trends have remained negative, with comparable-store sales
declining at about 7.8% through Dec. 10, 2005, while sales at its
direct channel have also decreased.
G+G RETAIL: Court Fixes May 15 as General Claims Bar Date
---------------------------------------------------------
The United States Bankruptcy Court for the Southern District of
New York, set May 15, 2006, at 5:00 p.m., as the deadline for all
creditors owed money by G+G Retail, Inc., on account of claims
arising prior to Jan. 25, 2006, to file their proofs of claim.
Creditors must file written proofs of claim on or before the May
15 claims bar date and those forms must be delivered to:
If by overnight courier or hand delivery:
United States Bankruptcy Court
Southern District of New York
G+G Retail, Inc., Claims Processing
Alexander Hamilton Custom House
One Bowling Green
New York, NY 10004-1408
If by standard mail (including U.S. Express mail):
G+G Retail, Inc., Claims Processing
P.O. Box 5047
Bowling Green Station
New York, NY 10274-5047
July 24, 2006, is the claims bar date for governmental units.
Headquartered in New York, New York, G+G Retail Inc. retails
ladies wear and operates 566 stores in the United States and
Puerto Rico under the names Rave, Rave Girl and G+G. The Debtor
filed for Chapter 11 protection on Jan. 25, 2006 (Bankr.
S.D.N.Y. Case No. 06-10152). William P. Weintraub, Esq., Laura
Davis Jones, Esq., David M. Bertenthal, Esq., and Curtis A.
Hehn, Esq., at Pachulski, Stang, Ziehl, Young & Jones P.C.
represent the Debtor in its restructuring efforts. When the
Debtor filed for protection from its creditors, it estimated
assets of more than $100 million and debts between $10 million
to $50 million.
GENERAL MOTORS: Files 2005 Annual Report with SEC
-------------------------------------------------
General Motors Corp. (NYSE: GM) finalized its 2005 financial
results and filed its annual report on Form 10-K with the
Securities and Exchange Commission. In addition, GM also included
restated results for the years 2000-2004 on Form 10-K/A.
GM concluded its internal review involving the classification of
cash flows principally at Residential Capital Corp., the
residential mortgage subsidiary of GMAC. Revisions were made to
the consolidated statement of cash flows for GM for 2002-2004,
while the 2005 annual statement of cash flows was finalized and
reported for the first time as part of the 10-K filing. These
restatements do not affect GM's, GMAC's or ResCap's income
statements, balance sheets, or the net cash flows for any of the
affected periods. In addition, these revisions to consolidated
cash flows do not affect GM's cash flows from automotive
operations.
In concluding the review, GM determined that the cash flows
related to certain mortgage activities were not appropriately
classified as either operating cash flows or investing cash flows.
As a result, GM restated its financial statements relating to
2002-2004, and for the first three quarters of 2005. These
changes reduced operating cash flows and increased investing cash
flows in each respective period by the same amount.
GM previously disclosed that it was restating its financial
results for the calendar-year periods 2000-2004 and the first
quarter of 2005 as a result of revisions in a number of other
accounting areas.
Furthermore, as a result of cash flow adjustments mentioned above
and other previously announced adjustments, GM concluded its
consolidated financial statements for 2002-2004 and for the first
three quarters of 2005 should no longer be relied upon.
A full-text copy of the 2005 Financial Results and Annual Report
on Form 10-K is available at no charge at
http://ResearchArchives.com/t/s?71b
A full-text copy of the Restated Results for the Years 2000-2004
on Form 10-K/A is available at no charge at
http://ResearchArchives.com/t/s?71f
About General Motors
General Motors Corp. -- http://www.gm.com/-- the world's largest
automaker, has been the global industry sales leader for 75 years.
Founded in 1908, GM today employs about 327,000 people around the
world. With global headquarters in Detroit, GM manufactures its
cars and trucks in 33 countries. In 2005, 9.17 million GM cars
and trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn and Vauxhall. GM operates one of the
world's leading finance companies, GMAC Financial Services, which
offers automotive, residential and commercial financing and
insurance. GM's OnStar subsidiary is the industry leader in
vehicle safety, security and information services.
* * *
As reported in the Troubled Company Reporter on Mar. 21, 2006,
Moody's Investors Service placed the B2 long-term rating of
General Motors Corporation on review for possible downgrade and
lowered the company's Speculative Grade Liquidity to SGL-2 from
SGL-1. Moody's also changed the review status of General Motors
Acceptance Corporation's Ba1 long-term rating to "review for
possible downgrade" from "review with direction uncertain" and
confirmed GMAC's Not Prime short-term rating. In addition,
Moody's changed the review status of ResCap's senior unsecured
Baa3 and short-term Prime-3 ratings to "review for possible
downgrade" from "review with direction uncertain." These rating
actions follow GM's announcement that it will delay filing its
annual report on Form 10-K with the SEC due to an accounting issue
regarding the classification of cash flows at ResCap, the
residential mortgage subsidiary of GMAC.
GOLD KIST: Moody's Holds B2 Rating on $130MM Sr. Unsecured Notes
----------------------------------------------------------------
Moody's Investors Service changed the ratings outlook for Gold
Kist Inc., to stable from positive, downgraded its speculative
liquidity rating to SGL-2 from SGL-1, and affirmed its B2 senior
unsecured note rating and its B1 corporate family rating.
Rating downgraded:
* Speculative grade liquidity rating -- downgraded to
SGL-2 from SGL-1
Ratings affirmed:
* $130 million senior unsecured notes, due 2014 -- affirmed B2
* Corporate family rating -- affirmed B1
Rating outlook -- changed to stable from positive
Moody's does not rate the company's $250 million senior secured
revolving credit facility, maturing 2010; or approximately $15
million of other debt.
The change in rating outlook to stable reflects Moody's view that
Gold Kist's ratings are unlikely to be upgraded over the near
term. The view reflects the rapid and significant deterioration
in the company's financial performance, very difficult conditions
in the US poultry industry in general, and the heightened event
risk of an avian influenza outbreak in the US.
Conditions in the poultry industry have taken a dramatic negative
turn in the past 3-4 months from its cyclical peak in 2004-2005.
High pathogenic avian influenza continues to spread across the
globe and has become a major concern in certain key export markets
for American poultry products. A precipitous decline in chicken
demand from several of these markets has resulted in a glut of
chicken products and a sharp decline in chicken prices
domestically.
On Feb. 6, 2006, Gold Kist announced that first quarter ended
Dec. 31, 2005, operating income fell almost 75% largely due to
weak industry conditions. Although Gold Kist generated solid cash
flow in the past when the chicken industry was at peak of its
cycle and its current financial metrics appear healthy for its
current B1 rating, Moody's expects these ratios to deteriorate
significantly over the near term.
Should an AI outbreak occur in the US, the country's trading
partners would likely restrict US chicken imports and consumers
could reduce consumption; both developments would have negative
repercussions for US chicken processors. The stable outlook
reflects Moody's opinion that the current B1 rating level
appropriately captures known business and liquidity risks over the
rating horizon, and is more reflective of the company's near-term
financial profile. It also reflects Moody's expectation that Gold
Kist will be able to sustain 3-year average Debt/EBITDA in the
4.0-5.0X range.
Over time, positive rating pressure could build if:
1) event risk from a US avian influenza outbreak ebbs;
2) the company is able to sustain solid operating performance
and financial flexibility even as industry conditions
weaken; and
3) Gold Kist continues to develop a track record as a well-run
publicly traded company.
Upward rating momentum would also require the company to be able
to sustain 3-year average Debt/EBITDA of 3.5X or lower, with free
cash flow to debt in the 6% - 8% range. Conversely, ratings could
come under downward pressure if 3-year average Debt/EBITDA climbs
above 6X, if it exceeds 7.5X during an industry downturn, and if
free cash flow turns negative for a prolonged period.
The downgrade of Gold Kist's speculative liquidity rating to
SGL-2 from SGL-1 reflects Moody's expectation that materially
weaker financial performance could result in tightened financial
covenants in the next twelve months. In December 2005, the
company amended and restated its committed senior secured bank
credit facility to increase the commitment to $250.0 million and
to amend financial covenants. The main financial covenants are a
minimum LTM fixed charge ratio of 1.25x, and a maximum total debt
to LTM EBITDA ratio of 3.25x.
Moody's expects the cushion with respect to each of these
covenants to tighten over the next year as a result of sharply
weaker financial performance. Should cash flow continue to
deteriorate, Moody's expects that the fixed charge ratio will come
under most pressure in the second half of FY 2006. Still, a
SGL-2 represents good liquidity. Over time, Gold Kist has built
up large cash balances as a result of very favorable poultry
markets during 2004 and 2005, enabling the company to reduce debt
and minimize debt amortization in the near term. Moody's expects
that existing cash balances and internal cash flow generation will
cover cash needs over the next year.
As of Dec. 31, 2005, the company had no drawings under its $250
million revolver, but had approximately $54 million of letters of
credit issued under it. Gold Kist's assets are fully pledged,
limiting asset sales as an alternative source of liquidity.
Moody's also anticipates that Gold Kist's bank group would likely
provide temporary financial covenant relief during 2006 should it
become necessary.
Moody's considered Gold Kist's ratings in the context of the key
rating drivers cited in Moody's Rating Methodology for Global
Natural Product Processors.
1) Scale and diversification -- Gold Kist is the third largest US
chicken processor, with an estimated market share of about 9%,
well behind Tyson and Pilgrim's Pride. Gold Kist has a strong
regional presence in the southeast US, where it has operated
integrated poultry processing operations since 1951. The company
has well established relationships with major retail, foodservice
and industrial customers, and a stable base of poultry contract
growers. Gold Kist's operation is concentrated on one protein,
chicken. Of its production, 50% is value added with the remainder
being commodity type products which are fresh, frozen, or
minimally processed. Further, Gold Kist is the largest private
label chicken producer in the US and its export accounts for less
than 10% of its annual sales.
2) Franchise strength and growth potential -- Gold Kist's
franchise strength is moderate. The company operates within a
very mature, highly-competitive, and low-margin industry which
lacks the earning stability enjoyed by larger and more diversified
food companies. US chicken consumption trends are favorable,
showing steady but modest growth. However, poultry markets can be
materially impacted by international trade-related issues such as
the establishment of tariffs or import regulations by key export
markets. Export markets are important to US chicken processors as
they provide an outlet for dark meat and other chicken products
not valued by the US consumers. In addition, poultry operations
are exposed to potential disease and product contamination related
losses. Furthermore, the company has high concentration of
customers with its top 10 customers accounting for 38% of the
total sales. Organic growth has been moderate in terms of volume
over the recent past given the mature stage of the industry.
Future growth potential exists but is limited.
3) Earnings and cash flow volatility -- Gold Kist is exposed to
volatile commodity input and output prices that have at times
caused wide swings in the company's profitability. While
volatility is a defining characteristic of commodity oriented food
companies, Gold Kist's situation is compounded by its
concentration in a single protein and its sub-optimal product mix
which includes a high percentage of commodity products
4) Cost efficiency and profitability -- In downcycles, Gold Kist's
profitability lags behind that of its key peers such as Tyson,
Pilgrim's Pride, and Sanderson Farms, although in industry upturns
it has generally outperformed peers. The company has earmarked
$200 million of capital spending over the next few years to change
its product mix, expand its further processed capacity, and to
reduce its cost base in an effort to enhance its ability to
withstand commodity input and output pricing pressures. Future
efficiency and profitability are expected to improve if the
company's capital spending program achieves its objectives.
5) Liquidity under stress -- Liquidity is an important element for
Gold Kist's long term ratings because its business is highly
volatile. Gold Kist's current liquidity profile is good which is
characterized by its SGL-2 speculative grade liquidity rating that
considers its significant cash balance and sufficient availability
under committed bank borrowing facilities, albeit with some
tightening in the covenant cushion expected.
6) Financial policy and credit metrics -- Gold Kist's financial
policy is generally conservative. The company has not paid cash
dividends or repurchased stock since becoming a public company in
October 2004. Moody's notes that this conservative financial
policy is particularly appropriate at this time. Given its
current operating performance, expected near-term deterioration in
debt protection measures as well as overall industry challenges,
there is little cushion for Gold Kist to pursue large scale
acquisitions or a more aggressive financial policy within its
current rating category. And, while Gold Kist's historical credit
metrics are strong for a B1 credit, Moody's expects a material
deterioration near term.
Gold Kist's senior unsecured notes are guaranteed by subsidiaries.
The notes are notched down from the corporate family rating
because they rank junior to the company's senior secured debt,
which could increase from current levels to a much more material
portion of the capital structure.
Gold Kist, Inc., with revenues exceeding $2.2 billion, is a
producer and processor of fresh and further processed chicken.
The company's headquarters are in Atlanta, Georgia.
GREAT CANADIAN: CDN$80 Mil. Equity Plan Cues DBRS to Hold Rating
----------------------------------------------------------------
Dominion Bond Rating Service confirmed the rating of Great
Canadian Gaming Corporation at BBB (low) and removed the rating
from "Under Review with Negative Implications". The rating action
follows Great Canadian's plans to raise CDN$80 million of equity
through a private placement transaction expected to close in the
near term, and the Company's covenant amendment negotiations with
its noteholders and bank lenders to avoid a potential covenant
breach. The rating confirmation assumes the private placement
transaction will be successful. The trend is Negative.
Rating action:
* Great Canadian Gaming Corporation Senior
Secured Debentures -- Confirmed at BBB (low)
DBRS downgraded the rating on March 20, 2006, as a result of these
factors:
(1) The absence of growth in cash flow from operations
following a near tripling of debt levels in 2005 caused
key credit metrics as of Dec. 31, 2005, to be well below
DBRS's expectations.
(2) DBRS is concerned about management stability and
challenges relating to major capital projects and the
integration of newly acquired operations.
(3) While Great Canadian is expected to refrain from making
acquisitions in the near term, capital spending is
expected to continue on the existing property portfolio.
As well, over the long term, the Company remains focused
on growth activities that may lead to higher leverage and
integration challenges. Apart from the expected debt
reduction from a planned CDN$80 million equity issuance in
the near term, DBRS does not expect any material debt
reduction over the next two years. Therefore, financial
risk has increased and any debt reduction in the near term
will depend primarily on improving operating cash flow or
proceeds from possible sales of non-core assets.
(4) Although revenues in 2005 increased by 58%, net income
from recurring operations fell by 12%. Earnings were
negatively affected by lower EBITDA margins due to
staffing and other cost increases at head office and
certain operations, a shift in revenue mix toward lower
margin sources, and interest costs more than tripling due
to much higher debt levels. These factors, together with
delays on major initiatives, resulted in EBITDA for 2005
being approximately 30% below DBRS's expectations.
Notwithstanding those concerns, the rating is supported by:
-- An expected strengthening of credit metrics due to planned
equity issuance and expected earnings growth. Customer
traffic levels remain strong and cost reduction efforts are
in place, which should eventually lead to stronger earnings
from acquired and expanded operations. Adjusted cash flow
from operations-to-total debt is expected to improve from
0.12 times as of Dec. 31, 2005, to approximately 0.20 times
by Dec. 31, 2006.
-- Heavy regulation of gaming in British Columbia, and the
other jurisdictions in which the Company operates, act as a
barrier to entry leading to strong operating margins.
-- Great Canadian has a leading market position in British
Columbia with 45% of provincial slot machines and 56% of
tables. It has a particularly strong position with
favourable locations within the Greater Vancouver Regional
District. The Company is also the sole casino operator in
Nova Scotia.
-- As of Dec. 31, 2005, expected future reimbursements of
capital costs by provincial gaming corporations offset
total debt.
The rating trend is Negative because of uncertainty around the
Company's ability to achieve all of the expected earnings growth,
especially at its River Rock and Coquitlam casinos in British
Columbia, where Great Canadian is expecting revenue growth due to
recent capital improvements.
For more information on this credit or on this industry, please
visit http://www.dbrs.com/
GRUPO GIGANTE: Fitch Assigns BB Rating to Proposed Senior Notes
---------------------------------------------------------------
Fitch Ratings assigned a rating of 'BB' to Grupo Gigante S.A. de
C.V.'s (Gigante) proposed offering of senior notes due 2016 up to
US$250 million. Proceeds from the offering will be used to prepay
existing debt. The Rating Outlook is Stable.
The rating is supported by:
* the company's business position in the Mexican food retail
market;
* a multiple-format store strategy that allows Gigante to reach
a wide customer base; and
* geographic diversity.
The rating is constrained by the company's financial profile and
declining store traffic and same store sales trend. Gigante is
the fourth largest supermarket chain in Mexico based on revenue,
with approximately 10% market share and the second largest store
network.
Over the past several years, the Mexican retail market has become
increasingly competitive since Wal-Mart de Mexico (Walmex) entered
the market with its aggressive low pricing sales approach. In
response to market trends, during 2005 Gigante implemented several
strategic initiatives designed to improve its long term
competitive position in face of these challenges. The company
redefined its commercial strategy and introduced a store
remodeling program, shifted its pricing strategy from high/low to
'Everyday low price', closed underperforming units and implemented
a company-wide integrated information technology system (SAP).
The company is also seeking to increase distribution efficiency by
expanding its network of regional distribution centers.
Fitch expects that the recent operating initiatives will help
reverse the negative trend in same store sales experienced by the
company over the past several years. Same store sales declined by
3.4% during 2004 and by 6.4% during 2005. These figures compare
unfavorably with declines of 0.7% and 2.4% respectively for the
supermarket sector as a whole (according to ANTAD-Asociacion
Nacional de Tiendas de Autoservicio y Departamentales; excluding
Walmex). The decrease in same store sales has been primarily the
result of a drop in customer attendance and increased competition.
In 2005, EBITDA, EBITDAR and profit margins, which had grown in
2003 and 2004, were affected by the execution of the new strategic
measures, including:
* non-recurrent charges related to the closing of non-
productive stores;
* headcount reductions; and
* disruptions from the implementation of SAP.
The creation in 2004 of a supply purchasing consortium, Sinergia,
by:
* Gigante,
* Soriana, and
* Comercial Mexicana (Walmex's largest retail competitors),
has helped reduce inventory costs while allowing these companies
to better compete with Walmex's pricing.
The new strategic initiatives along with stronger purchasing
power, should allow the company to improve efficiency and profit
margins within a highly competitive industry.
Leverage is moderately high and consistent with the 'BB' rating
category. Credit ratios slightly improved from 2002 to 2004 due
to higher EBITDA, but deteriorated in 2005 due to the
implementation of the new strategies.
At Dec. 31, 2005, the ratio of total adjusted debt (including
off-balance-sheet debt related to operating leases) to EBITDAR
was 4.1x and the ratio of EBITDAR/interest expense plus rents
was 1.7x. The senior notes are not guaranteed by Gigante USA and
the company's joint ventures with Radio Shack and Office Depot.
Excluding these operating companies, total adjusted debt-to-
EBITDAR at Dec. 31, 2005, reached 4.5x and the ratio of
EBITDAR/interest expense plus rents was 1.6x. Credit protection
measures should gradually improve over the next few years and
become more solid within the rating category as the strategic
initiatives undertaken by the company during the past year begin
to reap benefits.
At Dec. 31, 2005, the company had US$263 million of on-balance-
sheet debt, the majority of it bank debt. The senior notes
due 2016 will refinance existing debt and extend the maturity
profile. At Dec. 31, 2005, the company had adequate liquidity
with US$51 million of cash and marketable securities.
The company owns approximately 52% of its retail store sales
floor. Capital expenditures, which totaled US$74 million in 2004
and US$124 million in 2005, have been financed with internally
generated cash. In 2006, capital expenditures are budgeted to
reach approximately US$90 million and will primarily fund the
opening of three supermarkets and eight restaurants and the
remodeling of 21 supermarkets and two restaurants. The company
expects to fund capital investments with internally generated cash
flow, thereby maintaining debt levels stable.
Gigante is the fourth largest supermarket chain in Mexico, with
revenues of US$2.9 billion in 2005. At Dec. 31, 2005, the company
had presence in more than 85 cities and 32 states in Mexico. It
also had smaller retail operations in the USA and Central America.
In Mexico, Gigante operates 266 self-service stores that mainly
sell groceries, perishables, clothing and general merchandise
under four formats:
* Gigante,
* Bodega Gigante,
* Super Gigante, and
* SuperPrecio.
Each format is targeted to a different socioeconomic segment. In
the United States, Gigante operates the format Gigante USA with
nine stores located in Los Angeles, California. The company also
operates a chain of 57 family style restaurants and has joint
ventures with:
* Office Depot (116 stores), and
* Radio Shack (129 stores).
HALCO LLC: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Halco, LLC
aka Outdoor Sports
P.O. Box 4810
Dublin, Georgia 31040
Bankruptcy Case No.: 06-30083
Chapter 11 Petition Date: March 28, 2006
Court: Southern District of Georgia (Dublin)
Judge: Susan D. Barrett
Debtor's Counsel: Jesse C. Stone, Esq.
Merrill and Stone, LLC
P.O. Box 129
Swainsboro, Georgia 30401
Tel: (478) 237-7029
Fax: (478) 237-9211
Total Assets: $2,165,500
Total Debts: $2,212,667
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Henry's Tackle, LLC $86,031
c/o Cynthia E. Call, P.C.
191 East Broad Street, Suite 303
Athens, GA 30601
The North Face, Inc. $73,424
CST Building
P.O. Box 33127
Louisville, KY 40232-3127
Georgia Dept. of Revenue $60,000
P.O. Box 161108
Atlanta, GA 30321
Browning $46,978
Beretta U.S.A. Corp. $44,465
Acusport Corporation $33,384
Fiocchi of America, Inc. $18,900
American Rod & Gun $17,598
Russell Corporation $16,575
Tour Golf Group $10,718
Georgia Boot, LLC $9,765
Benelli USA $7,790
The Combs Co. $7,784
Zeiss $7,723
Callawy Golf $7,590
Taylor Made Golf Co., Inc. $7,564
Middle Georgia Mechanical $6,844
Cleveland Golf $5,480
The Courier Herald $4,241
Laurens County Tax Commissioner $2,890
HARTWICK COLLEGE: Moody's Holds Ba1 LT Rating with Stable Outlook
-----------------------------------------------------------------
Moody's Investors Service affirmed Hartwick College's Ba1 long-
term rating. Moody's has revised the outlook for the rating to
stable from negative, reflecting the College's recent financial
improvement, including narrowing of operating deficits, driven by
growth in net tuition revenue, increased philanthropic support,
improved investment returns, and careful expense control. However,
Moody's believes the College's financial position is still
relatively fragile, given its high dependence on student charges,
limited liquidity, and persistent operating imbalance. The rating
affirmation affects $24 million of outstanding Series 2002 bonds,
issued through the County of Otsego Industrial Development
Authority.
Legal Security: General obligation; debt service reserve fund.
Interest Rate Derivatives: none
Strengths:
* Stable enrollment of 1,440 FTE students in fall 2005, and
10% growth in net tuition per student to $14,642 in FY 2005.
Preliminary financial information for FY 2006 indicates
further growth in net tuition revenue of about 4%. The
College also reports favorable prospects for freshmen
entering in fall 2006. Applications have already achieving
the target of 2,500, with several months still remaining in
the application process, and the College has received two
times more deposits than at this time last year.
* Continued positive investment performance in FY2005 and
year-to-date FY2006 bolsters liquidity. Fiscal year 2006
investment performance through the end of January shows a
10.2% return on the portfolio, which is managed by the
Commonfund.
* Positive operating cash flow in FY2005 of 4.9% by Moody's
measures, compared to a 5% cash flow deficit as recently as
FY 2003, although recent performance still does not fully
cover debt service under a 5% endowment spending draw. The
improving cash flow margin is due to revenue growth in core
net tuition revenue, as well as an increase in unrestricted
giving and continued expense management.
* Maintenance of heightened philanthropic support to the
College, with $5 million in total gift revenue;
* Continued management and leadership focus on student niche
positioning, building fundraising capacity, and achieving
greater operational balance.
Challenges:
* Highly competitive market for students in New York, as
demonstrated by the College's still thin selectivity of 87%
and low yield of 21% on accepted students. In addition, the
College did not achieve its freshmen enrollment target of
440 students in fall 2005, although net tuition revenue is
still expected to outperform the FY06 budget due to savings
in financial aid.
* Current operations do not fully cover debt service, and
operational recovery plan demands a sustained improvement in
unrestricted giving, as well as further improvement in
student market positioning to garner growing net tuition
revenue, which may prove challenging given the competitive
environment.
* Highly liquid unrestricted resources provide only a moderate
cushion for debt and operations at 0.6 and 0.4 times,
respectively, particularly in light of the College's ongoing
operational challenges.
* Several consecutive years of expense reductions lead to the
need to invest in faculty, facilities and program in order
to remain competitive.
Outlook:
Hartwick's rating outlook is now stable, reflecting the College's
demonstrated ability to grow tuition revenue, build liquidity,
attract philanthropic support, and narrow the operating deficit.
We believe that the College's management team, president, and
Board are prudently focused on those areas likely to further
improve credit quality in the future.
What Could Change The Rating Up -- Further strengthening of
student demand and stabilized enrollment of new freshmen,
accompanied by a consistent trend in positive operating cash
flow providing solid coverage of debt service.
What Could Change the Rating Down -- Deterioration in liquidity,
worsening of operating deficits, or weakening of student
market position.
Key Data and Ratios
Total Enrollment: 1,440 full-time equivalent students
Freshman Applicants Accepted: 87.2%
Freshman Accepted Students Enrolled: 21.2%
Expendable Resources to Pro Forma Debt: 1.29 times
Expendable Resources to Operations: 0.65 times
3-Year Average Operating Margin: -9.7%
Operating Cash Flow Margin: 4.9%
Actual Debt Service Coverage: 0.9 times
IMPERIAL PETROLEUM: Losses & Deficit Prompt Going Concern Doubt
---------------------------------------------------------------
Malone & Bailey, PC, expressed substantial doubt about Imperial
Petroleum Recovery Corporation's ability to continue as a going
concern after auditing the Company's financial statements for the
year ended Oct. 31, 2005. The auditing firm pointed to the
Company's recurring losses from operations since its inception,
accumulated deficit and $1,075,442 of debt obligations that were
past due as of Oct. 31, 2005.
Imperial says that it is planning to raise additional capital by
offering equity securities to fund its operations and it will
continue raising capital resources until the Company can generate
enough revenues to maintain itself as a viable entity.
2005 Financials
For the 12 months ended Oct. 31, 2005, Imperial Petroleum earned
$602,699 of net income on $5,000 of total revenues. For the
12 months ended Oct. 31, 2004, the Company incurred a $857,231 net
loss on $30,200 of total revenues.
As Oct. 31, 2005, Imperial balance sheet showed $2,171,843 in
total assets and $4,963,203 in total liabilities. The Company's
balance sheet shows a $17,936,113 accumulated deficit at
Oct. 31, 2005.
Imperial Petroleum delivered an amended annual report to the
Securities and Exchange Commission on March 22, 2006. The
Company didn't give any reason amending its annual report.
A full-text copy of Imperial Petroleum's amended annual report
is available for free at http://ResearchArchives.com/t/s?70c
Headquartered in Houston, Texas, Imperial Petroleum Recovery
Corporation and its wholly owned subsidiary, Petrowave
Corporation, is a leader in developing and marketing innovative
commercial radio frequency energy applications that can be used
within the petroleum and other industries to treat emulsions
containing oil, water and solids in the production process to
enhance process efficiency and improve the Company's customers'
end product, or in the creation of biodiesel fuels.
As of Oct. 31, 2005, Imperial Petroleum's stockholders' equity
deficit contracted to $2,791,360 from a $6,755,958 equity deficit
reported at Oct 31, 2004.
INTERNATIONAL COAL: Earns $31.8 Million for Fiscal Year 2005
------------------------------------------------------------
International Coal Group, Inc. (NYSE: ICO) reported net income of
$31.8 million for the year ended Dec. 31, 2005, versus a loss of
$103.4 million in 2004. However, the results of operations for
the three months ended December 31, 2005, were mixed when compared
to the fourth quarter of the prior year. International Coal was
formed to acquire the principal operations of then-bankrupt
Horizon Natural Resources on Oct. 1, 2004.
ICG's 2005 results, compared to the comparable period in 2004,
were:
* Revenue was $647.7 million for the fiscal year 2005, up 27%
from $509.5 million in 2004;
* Operating income was $56.8 million for the year ended
Dec. 31, 2005, up 112% from $26.8 million in 2004;
* Net income was $31.8 million for the fiscal year 2005 versus
a net loss of $103.4 million in 2004; and
* Earnings before net interest, income taxes and depreciation,
depletion and amortization, or EBITDA, was $106.1 million for
the year ended Dec. 31, 2005, up 103% from $52.3 million in
2004.
For the three months ended Dec. 31, 2005, revenue was $182.1
million up 34% from $136.1 million for the same period in 2004.
Operating income was $7.0 million, down 25% from $9.4 million. Net
income was $3.3 million versus $4.2 million. EBITDA was $23.1
million, up 26% from $18.2 million.
Fourth quarter results were adversely impacted by significant
price increases for diesel fuel, blasting agents, and other
services or commodities that are dependent on crude oil or natural
gas. The tight labor market in Eastern Kentucky constrained
hiring and delayed the production ramp-up schedule at our Flint
Ridge complex. Also, shortfalls in coal deliveries from purchased
coal suppliers forced ICG to postpone certain shipments.
Additionally, fourth quarter and year-end profitability was
affected by approximately $600,000 and $3.9 million of non-cash
costs associated with initial restricted stock grants to senior
management.
ICG completed the acquisition of Anker Coal Group, Inc. and
CoalQuest Development, LLC on Nov. 18, 2005. Implementation of
various operational improvements planned for the former Anker
operating companies has taken longer than originally anticipated,
delaying the expected increase in coal production and decrease in
production costs for the fourth quarter. The Anker entities
reported fourth quarter (11/18 - 12/31) production of
approximately 276,000 tons with sales of approximately 486,000
tons, which resulted in negative EBITDA of $3.2 million and a loss
of $4.1 million (pre-tax). Performance of the Anker group prior
to the merger is not included in ICG's reported financial results.
Recent performance has generally improved, indicating that the
operating issues are being appropriately addressed and suggesting
that 2006 production rates and profit margins should be higher.
"With respect to ICG's performance in 2005, we are pleased that
significant milestones were achieved such as the acquisition of
Anker and CoalQuest and ICG's listing on the New York Stock
Exchange," said Ben Hatfield, President and Chief Executive
Officer of ICG. "We have established a position that we believe
will allow us to capitalize on the continuing strong fundamentals
for the coal industry, despite what we perceive as temporary
margin pressures caused by recent cost increases across the
industry. We plan to continue investing in upgrading our
equipment and developing our sizeable reserves to fuel internal
growth."
Wilbur Ross, the Chairman of ICG's Board of Directors and a
leading investor in ICG, said, "We remain excited by ICG's
prospects. The company endured an eventful fourth quarter
followed by a heart-wrenching first quarter. However, the
company's management has remained focused on taking the right
steps for its investors and employees by moving forward with its
ambitious development plans."
Headquartered in Ashland, Kentucky, International Coal Group, Inc.
-- http://www.intlcoal.com/-- is engaged in the mining and
marketing of steam coal. The company has eleven active mining
complexes, of which ten are located in Northern and Central
Appalachia and one in Central Illinois. ICG's mining operations
and reserves are strategically located to serve utility,
metallurgical and industrial customers throughout the Eastern
United States.
* * *
As reported in the Troubled Company Reporter on Oct. 29, 2004,
Standard & Poor's Rating Services assigned its 'B-' corporate
credit rating to International Coal Group LLC.
At the same time, Standard & Poor's assigned its 'B-' rating and
recovery rating of '3' to International Coal's proposed
$285 million senior secured bank credit facility. The outlook is
stable. The bank loan rating is the same as the corporate credit
rating; this and the '3' recovery rating indicate a meaningful
recovery (50% to 80%) of principal in the event of a default on
the company's senior secured revolving credit facility.
"The ratings on ICG reflect its relatively small size; its high-
cost profile and significant exposure to the difficult operating
environment of Central Appalachia," said Standard & Poor's credit
analyst Paul Vastola. They also reflect heavy capital spending
needs to address aging mining equipment; fairly aggressive debt
leverage factoring debt-like obligations; and
uncertainties/concerns pertaining to the condition of its mines
due to underspending by its predecessors during two bankruptcies.
Ratings also reflect ICG's high-quality coal, nominal
postretirement liabilities, and currently favorable conditions in
the domestic coal industry.
IPCS INC: S&P Raises Corp. Credit & Sr. Unsec. Debt Ratings to B-
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on
Schaumburg, Illinois-based iPCS Inc., including:
* the corporate credit rating, which was raised to 'B-'
from 'CCC+'; and
* the senior unsecured debt rating, which was raised to 'B-'
from 'CCC'.
The outlook is stable. Debt outstanding at Dec. 31, 2005, totaled
approximately $304 million.
"The rating upgrade reflects improvement in the company's credit
protection measures following its emergence from bankruptcy in
mid-2004, its enhanced business profile resulting from the July
2005 merger with Horizon PCS Inc., and adequate liquidity," said
Standard & Poor's credit analyst Susan Madison.
Investments made by iPCS over the past two years in its sales
infrastructure and wireless network are beginning to produce
positive operating results, with healthy subscriber growth and
improved churn rates over the past few quarters. As a result,
debt to EBITDA, adjusted for operating leases, declined to
approximately 5.7x at Dec. 31, 2005, compared with 6.6x at
Sept. 30, 2005, pro forma for the merger with Horizon.
Although operating performance has improved, credit risk is still
significant. Risk factors include:
* the company's reliance on Sprint Nextel Corp., which owns the
wireless spectrum licenses used by the company to provide
service;
* uncertainty regarding ongoing litigation with Sprint Nextel
regarding exclusivity provisions contained in the companies'
affiliate agreement; and
* iPCS' negligible net free cash flow and aggressive leverage.
iPCS is a Sprint PCS affiliate serving approximately 495,000
subscribers, with the exclusive right to provide Sprint PCS
digital wireless services to 80 markets located in:
* Illinois,
* Michigan,
* Pennsylvania,
* Indiana,
* Iowa,
* Ohio, and
* Tennessee
and covering 15 million population equivalents.
IWO HOLDINGS: Moody's Lifts Secured Bond Rating to Baa2 from Caa2
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of IWO Holdings and
US Unwired to Baa2. The upgrade is based upon the issuance of
unconditional and irrevocable guarantees of those notes on a
senior unsecured basis by Sprint Nextel Corporation. Moody's also
assigned a short-term debt rating of P-2 to Sprint Nextel
Corporation and affirmed the company's long-term senior unsecured
ratings of Baa2 with stable outlook.
Upgrades:
Issuer: IWO Holdings, Inc.
* Senior Secured Regular Bond/Debenture, Upgraded
to Baa2 from B3
* Senior Unsecured Regular Bond/Debenture, Upgraded
to Baa2 from Caa2
Issuer: US Unwired Inc.
* Senior Secured Regular Bond/Debenture, Upgraded
to Baa2 from a range of Caa1 to B2
Reinstatements:
Issuer: Sprint Nextel Corporation
* Commercial Paper, Reinstated to P-2
Outlook Actions:
Issuer: IWO Holdings, Inc.
* Outlook, Changed To Stable From Rating Under Review
Issuer: US Unwired Inc.
* Outlook, Changed To Stable From Rating Under Review
Withdrawals:
Issuer: IWO Holdings, Inc.
* Corporate Family Rating, Withdrawn, previously rated Caa1
Issuer: US Unwired Inc.
* Corporate Family Rating, Withdrawn, previously rated B3
The affirmation of Sprint Nextel's senior unsecured rating of Baa2
continues to reflect the company's improved market share following
the merger of Sprint and Nextel, and the strong free cash flow
generated by the company. Since the merger closed in August 2005,
Sprint Nextel has at least maintained market share and continued
to generate strong cash flow. The P-2 short term rating assigned
to issuances under the company's planned $2 billion commercial
paper program is supported by a $6 billion multi-year revolving
credit facility of which approximately $3.5 billion is currently
available. This backstop facility does not contain a material
adverse change clause at borrowing; has a one financial covenant
requiring the ratio of total indebtedness to EBITDA to be below
3.5 times, and is available for same-day borrowings.
The stable outlook reflects Moody's opinion that Sprint Nextel
will be able to maintain or grow market share and that the ratio
of free cash flow to debt will be between 10 to 15% over the next
two to three years. The primary adjustment Moody's makes to the
reported debt balance of Sprint Nextel is to add $11.5 billion in
order to capitalize its operating lease commitments. Upward
pressure on the ratings would come from financial outperformance
such that the ratio of free cash flow to debt increased to over
15% on a sustainable basis. Alternatively, the ratings would come
under downward pressure should Sprint Nextel begin to lose market
share or should the ratio of free cash flow to debt fall below
10%. The stable rating outlook incorporates the expectation that
Sprint Nextel will likely introduce a modest common dividend
program this year or next. A more aggressive dividend policy that
would reduce the ratio of free cash flow to adjusted debt below
the 10% threshold will likely have negative rating consequences.
With corporate headquarters in Reston, Virginia and operational
headquarters in Overland Park, Kansas, Sprint Nextel Corporation
has almost 40 million wireless subscribers at Dec. 31, 2005, and
pro forma LTM revenues of approximately $38.5 billion.
KYUNG KIM: Case Summary & 5 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Kyung Sook Kim
5372 Kalanianaole Highway
Honolulu, Hawaii 96821
Bankruptcy Case No.: 06-00157
Chapter 11 Petition Date: March 27, 2006
Court: District of Hawaii (Honolulu)
Judge: Robert J. Faris
Debtor's Counsel: Steven Guttman, Esq.
Kessner Duca Umebayashi Bain & Matsunaga
220 South King Street, Suite 1900
Honolulu, Hawaii 96813
Tel: (808) 536-1900
Fax: (808) 529-7177
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 5 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Bank of Hawaii Personal Guarantee $109,072
3600 Waialae Avenue
P.O. Box 2900
Honolulu, HI 96846-6000
Bank of America Credit Card $8,000
P.O. Box 53132
Phoenix, AZ 85072-3132
Internal Revenue Service Taxes $6,957
P.O. Box 21126
Philadelphia, PA 19114
Choice M/C Credit Card $4,149
Home Depot Credit Card $2,000
LOVESAC CORP: Can Assume Amended Headquarter Lease Agreement
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave the
LoveSac Corporation and its debtor-affiliates permission to:
1) assume their Headquarter Lease and enter into a lease
amendment with regards to the Headquarter Lease; and
2) reject their Headquarter Sublease with Acentus Consulting
Group, L.L.C.
As reported in the Troubled Company Reporter on Mar. 13, 2006,
Lovesac Corp. and SLNET Investments, L.C., entered into a Lease
Agreement on Sept. 1, 2004, for 18,805 square feet of office space
located in Suite 250, on the fifth floor of the Salt Lake
Hardware Building. That office became the Debtors' headquarters.
Lovesac also subleases approximately 6,204 square feet of its
headquarters office to Acentus Consulting pursuant to a Sublease
Agreement.
The Lease Amendment
Lovesac has determined that it doesn't need as much space as is
currently provided in the Headquarter Lease Agreement. Lovesac
and SLNET have decided to amend that Agreement to delete from
Lovesac's premises the Acentus sublease space and an additional
6,070 rentable square feet.
The amendment will leave Lovesac with 6,531 rentable square feet
that will remain under the Headquarter Agreement until the
scheduled termination of that Headquarter lease, which will occur
on Aug. 31, 2006. The rent for the lease will remain at $8,844
per month.
Headquartered in Salt Lake City, Utah, The LoveSac Corporation --
http://www.lovesac.com/-- operates and franchises retail stores
selling beanbags furniture. The LoveSac Corp. and three
affiliates filed for chapter 11 protection on Jan. 30, 2006
(Bankr. D. Del. Case No. 06-10080). Anthony M. Saccullo, Esq.,
and Charlene D. Davis, Esq., at The Bayard Firm and P. Casey
Coston, Esq., at Squire, Sanders & Dempsey LLP represent the
Debtors in their restructuring efforts. When the Debtors filed
for protection from their creditors, they estimated assets and
debts between $10 million to $50 million.
MASSACHUSETTS HEALTH: Moody's Holds Ba2 Rating on $5 Mil. Bonds
---------------------------------------------------------------
Moody's Investors Service affirmed the Ba2 bond rating assigned to
Bay Cove Human Service's $5.0 million of Series 1998 bonds issued
by the Massachusetts Health & Educational Facilities Authority.
The outlook is stable.
Legal Security: The Series 1998 Bonds are secured by first
mortgage liens on and security interests in certain real
properties of Bay Cove, including the organization's main
administrative building. There is a negative mortgage lien.
Additionally, the bonds are secured by a lien on and security
interest in the Department of Mental Retardation Contract
Receivables. The bonds are also secured by a pledge of the
DMR contract for the sole benefit of the bond Trustee, under
which payments are to be made to Bay Cove annually in an
amount not less than 150% of the Maximum Annual Debt Service.
Interest Rate Derivatives: None.
Strengths:
* Position as a large human service provider of essential
services in the Boston area, with specialization in services
to individuals with multiple disabilities
* Historically stable financial results with solid operating
margins of 1.5% and 2.8% in fiscal years 2005 and 2004,
respectively; first six months of FY 2006 are on par with
the comparable period in FY 2005
* Diverse revenue stream from different state departments
as well as private funding mitigates its vulnerability to
reductions to any one area of social service funding
* Stable economy in the Commonwealth of Massachusetts has
ensured continued funding of social programs
* Maintained revenue growth in FY 2005 as a result of three
new residential programs and two residential program
expansions; new contracts have an administrative increase
and provide a modest margin that allows Bay Cove to meet
inflationary expense throughout the organization
* Improved cash reserves in FY 2005 and the first six months '
of FY 2006 to $5.9 million, although Bay Cove views reserves
more as providing flexibility for short-term strategic
spending rather than as a long-term financial cushion that
is anticipated to grow
* Annual fundraising goals of close to one million dollars
that supplement ongoing operations
* Restructuring of its health benefits in July 2005 should
help control future benefit expense growth
Challenges:
* Dependence on state funding that could result in contract
reimbursement reductions for Bay Cove if the state
experiences budget shortfalls in future years
* The majority of existing contracts lack revenue updates, and
so do not provide adequate inflationary escalators for
salary and benefit increases
* Ongoing challenges of staff recruitment and retention is a
fundamental difficulty for the human services sector
* Despite recently improved liquidity reserves, cash reserves
of $5.9 million may not provide adequate cushion if
presented with significant operating challenges
* Possible increase in debt for strategic purposes in FY 2007
may weaken debt measures from the 5.7 times debt-to-cash
flow in FY 2005
Outlook:
The stable outlook reflects Moody's expectation that Bay Cove
will continue to leverage its position as a provider of
essential services and continue to demonstrate moderate annual
growth resulting in financial performance that is consistent
with prior years.
What could change the rating up: Growth in liquidity reserves and
an increased position as a sizable human service provider
What could change the rating down: Budget shortfalls in the
Commonwealth of Massachusetts that would force the state to
scale back on important social and health services; operating
losses; significant deterioration of cash reserves
Assumptions & Adjustments:
-- Based on combined financial statements for Bay Cove Human
Services, Inc. and Affiliate
-- First number reflects audit year ended June 30, 2004
-- Second number reflects audit year ended June 30, 2005
-- Investment returns normalized at 6% unless otherwise noted
* Total operating revenues: $39.8 million; $42.3 million
* Moody's adjusted net revenue available for debt service:
$2.5 million; $2.1 million
* Total debt outstanding: $9.1 million; $9.2 million
* Maximum annual debt service (MADS): $1.1 million; $1.1
million
* MADS Coverage with reported investment income: 2.2 times;
1.8 times
* Moody's adjusted MADS Coverage with normalized investment
income: 2.3 times; 1.9 times
* Debt-to-cash flow: 4.6 times; 5.7 times
* Days cash on hand: 23.2 days; 38.4 days
* Cash-to-debt: 26.5%; 46.6%
* Operating margin: 2.8%; 1.5%
* Operating cash flow margin: 6.0%; 4.4%
MULTIPLAN INC: Raising $250 Mil. in Proposed Senior Note Offering
-----------------------------------------------------------------
MultiPlan, Inc., plans to commence an offering of its senior
subordinated notes due 2016, which it expects will yield gross
proceeds of $250 million. The notes are expected to be sold to
qualified institutional buyers under Rule 144A and outside the
United States in compliance with Regulation S under the Securities
Act of 1933, as amended. The notes initially will be offered by
MultiPlan Merger Corporation, a newly formed New York corporation
affiliated with The Carlyle Group.
The net proceeds of the offering, together with amounts borrowed
under a new senior secured credit facility and the proceeds of an
equity Investment by an investor group led by The Carlyle Group,
will be used to fund the purchase price for, and pay certain fees
and expenses related to, the acquisition of MultiPlan by
affiliates of those investors and a member of MultiPlan's senior
management. Through a merger to be consummated immediately
following the closing of the offering of the notes, MultiPlan will
succeed to MultiPlan Merger Corporation's obligations as the
issuer of the notes.
The notes are being offered only to qualified institutional buyers
under Rule 144A and outside the United States in compliance with
Regulation S under the Securities Act. The notes being sold will
not be registered under the Securities Act of 1933, as amended, or
any state securities law and may not be offered or sold in the
United States absent registration or an applicable exemption from
registration requirements.
About MultiPlan
MultiPlan Inc. -- http://www.multiplan.com/-- is the nation's
oldest and largest independent Preferred Provider Organization
(PPO) network offering nationwide access to more than 4,200
hospitals, 90,000 ancillary care facilities and 450,000 physicians
and specialists. The company's 2,000 clients include large and
mid-sized insurers, third-party administrators, self-funded plans,
HMOs and other entities that pay claims on behalf of health plans.
* * *
As reported in the Troubled Company Reporter on Mar. 23, 2006,
Standard & Poor's Ratings Services affirmed its 'B+' counterparty
credit rating on MultiPlan Inc. The rating was removed from
CreditWatch, where it was originally placed on Feb. 21, 2005,
after the announcement of a definitive agreement that The Carlyle
Group would acquire MultiPlan in a deal valued at $1.0 billion,
which includes debt assumption. The outlook is stable.
At the same time, MultiPlan's proposed $450 million senior secured
bank credit facility was rated 'B+' (at the same level as the
corporate credit rating). The loan facility provides MultiPlan
with access to a six-year $50 million revolver due 2012 and a
seven-year $400 million term loan due 2013.
In addition, Standard & Poor's assigned its 'B-' rating to
MultiPlan's $250 million senior subordinated notes due 2016,
issued under Rule 144A without registration rights. The proceeds,
along with new equity, will finance the acquisition of the company
in a transaction valued at eleven times estimated 2006 EBITDA.
MUSICLAND HOLDING: Inks Stipulation on Services Pact with Deluxe
----------------------------------------------------------------
As reported in the Troubled Company Report on Mar. 21, 2006,
Deluxe Media Services, Inc., asked the U.S. Bankruptcy Court for
the Southern District of New York to:
a. require Musicland Purchasing Corp. to assume or reject the
Logistics Services Agreement immediately;
b. grant Deluxe relief from the automatic stay if the Debtors
reject the LSA; and
c. require the Debtors to immediately pay the amounts due
under the LSA.
Debtors Object
David A. Agay, Esq., at Kirkland & Ellis LLP, in New York City,
asserted that the Debtors have paid all undisputed, postpetition
amounts owed under the LSA.
Mr. Agay informed the Court that the payment arrangement between
the Debtors and Deluxe under the LSA provides for net 30-day
terms. Deluxe issued its first invoice for postpetition services
under the LSA for $807,082, on February 6, 2006. Deluxe issued an
updated invoice for $636,861, on February 9, 2006.
The Debtors have paid the February 9 invoice. However, they have
refused to pay the approximately $170,000 differential reflected
in the February 6 invoice, because that amount purportedly results
from Deluxe's "cost-plus margin" pricing. The Debtors believed
that this is the disputed amount indicated in the motion.
The Debtors have agreed to escrow the disputed differential
between the two invoices and any future disputed amounts.
Thus, no grounds exist for demanding payment of a contested
administrative claim that is not yet due and payable under the
LSA, Mr. Agay asserted.
Thus, the Debtors asked the Court to deny Deluxe's request.
Parties Stipulate
In a Court-approved stipulation, the Debtors and Deluxe Media
Service, Inc., agree that:
a. Deluxe agrees to adjourn that portion of the Motion to
Compel related to compelling assumption or rejection of the
Logistics Service Agreement until the date of the final
hearing on the Debtors' Motion to sell substantially all of
their assets, subject to bidding procedures.
b. The Debtors will pay Deluxe on a provisional basis, without
prejudice to their ability to dispute any portion of the
invoices at a later date, on the basis of the same pricing
method used in the calculation of Deluxe's February 9, 2006
invoice for January postpetition services. Deluxe's
acceptance of the amount paid by the Debtors will not
constitute a waiver of Deluxe's rights under the LSA or
under applicable law, including, but not limited to:
* Deluxe's right to the pricing method used in its
calculation of its February 6, 2006 invoice for January
postpetition services under the LSA; and
* Deluxe's ability to assert additional claims against
Musicland Purchasing Corp. or the Debtors, including the
right to challenge any of MPC's defenses, and Deluxe
expressly reserves its rights with respect thereto.
The provisional payments by MPC will not constitute a
waiver of MPC's rights to establish that Deluxe's billing
should have been reduced below the results obtained from
the method used to calculate the February 9, 2006 invoice,
nor will they constitute a waiver of any rights to defend
Deluxe's claims, to assert set-offs with respect to those
claims, or to assert any counterclaims against Deluxe.
c. On the date on which a payment becomes due under the terms
of the LSA and at the time payment is made to Deluxe using
the February 9, 2006 invoice pricing method, the Debtors
agree to deposit the difference between that payment and
the payment that MPC would have made using the pricing
method Deluxe used to calculate the February 6, 2006
invoice, into a segregated account held by Wachovia. At
the time of payment to Deluxe, the Debtors will provide
Deluxe with evidence that funds were deposited into the
Account.
d. The funds in the Account will only be released to the
Debtors or Deluxe upon entry of a final order by the
Bankruptcy Court directing payment of either party of the
Proceeds in the Account. To the extent the proceeds in the
Account, or any portion thereof, are determined to be due
and payable to Deluxe, those proceeds will not be subject
to the liens of the Secured Lenders, including Wachovia,
the Secured Trade Creditors or any other secured creditor,
which entities will be deemed to have waived all rights
only with respect to the proceeds in the Account which are
determined to be due and payable to Deluxe.
e. The parties agree to cooperate with each other in
exchanging any information about Deluxe's postpetition
invoices, services and costs and the status of the Debtors'
GOB sales and inventory movement, and other information as
reasonably requested by either of the Parties.
f. The parties will conduct discovery and prepare for an
evidentiary hearing on Deluxe's postpetition claims under
the LSA:
* Initial document requests and other written discovery
requests will be served by March 15 and answered on or
before April 15.
* Fact depositions will be noticed and completed prior to
May 15.
* Any Rule 26 expert reports will be served by May 22 and
any expert depositions completed by June 1.
The parties further agree that they will jointly ask that
the Bankruptcy Court schedule an evidentiary hearing on
the matter as soon as possible after June 1, 2006.
About Musicland Holding
Headquartered in New York, New York, Musicland Holding Corp., is a
specialty retailer of music, movies and entertainment-related
products. The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts. Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors. When the Debtors filed for
protection from their creditors, they estimated more than $100
million in assets and debts. (Musicland Bankruptcy News, Issue
No. 8; Bankruptcy Creditors' Service, Inc., 215/945-7000)
MUSICLAND HOLDING: Gets Final OK on Retail Consulting's Employment
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved the request of Musicland Holding Corp. and its debtor-
affiliates to employ Retail Consulting Services, Inc., as their
exclusive real estate consultant on a final basis.
As previously reported in the Troubled Company Reporter on
Jan. 31, 2006, the Debtors selected RCS because of its
considerable expertise and experience as real estate consultants.
The Debtors believed that the services to be provided by RCS is
essential to their efforts as debtors-in-possession and to
maximize the value of their assets for the benefit of their
creditors.
RCS will be paid $125,000 per month for lease renegotiations,
rejection claim analysis, and waiver or reduction of prepetition
cure amounts, starting January 1, 2006 until the termination of
the agreement, or unless ordered by the Court.
Upon closing of a transaction that disposes of any or all of the
Disposition Properties, a Consultant will receive:
* 4% of the total amount of money paid to the Debtors, if no
broker is used; or
* 5% of gross proceeds if a co-broker is used.
Headquartered in New York, New York, Musicland Holding Corp., is a
specialty retailer of music, movies and entertainment-related
products. The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts. Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors. When the Debtors filed for
protection from their creditors, they estimated more than $100
million in assets and debts. (Musicland Bankruptcy News, Issue
No. 8; Bankruptcy Creditors' Service, Inc., 215/945-7000)
NATIONAL GAS: Files Schedules of Assets and Liabilities
-------------------------------------------------------
National Gas Distributors, LLC delivered its Schedules of Assets
and Liabilities to the U.S. Bankruptcy Court for the Eastern
District of North Carolina, disclosing:
Name of Schedule Assets Liabilities
---------------- ------ -----------
A. Real Property
B. Personal Property $1,780,659
C. Property Claimed
as Exempt
D. Creditors Holding $32,500,000
Secured Claims
E. Creditors Holding $69,082
Unsecured Priority Claims
F. Creditors Holding $30,795,773
Unsecured Nonpriority
Claims
---------- -----------
Total $1,780,659 $63,364,855
National Gas Distributors, LLC -- http://www.gaspartners.com/--
used to supply natural gas, propane, and oil to industrial,
municipal, military, and governmental facilities. As of mid-
December 2005, the Company had effectively ceased business
operations due to inadequate remaining capital and its inability
to arrange for the purchase and delivery of natural gas to its
customers. The Company filed for bankruptcy on January 20, 2006
(Bankr. E.D.N.C. Case No. 06-00166). Richard M. Hutson, II, is
the Chapter 11 Trustee. When the Debtor filed for bankruptcy, it
estimated between $1 million to $10 million in assets and
$10 million to $50 million in debts.
NATIONAL GAS: Bankruptcy Administrator Unable to Appoint Committee
------------------------------------------------------------------
Karen T. Hayes, the Bankruptcy Administrator for the Eastern
District of Northern Carolina, disclosed that she was couldn't
appoint a committee of unsecured creditors in National Gas
Distributors, LLC's chapter 11 case.
Ms. Hayes tells the U.S. Bankruptcy Court for the Eastern District
of Carolina that there were insufficient creditors who expressed
willingness to serve on the committee.
National Gas Distributors, LLC -- http://www.gaspartners.com/--
used to supply natural gas, propane, and oil to industrial,
municipal, military, and governmental facilities. As of mid-
December 2005, the Company had effectively ceased business
operations due to inadequate remaining capital and its inability
to arrange for the purchase and delivery of natural gas to its
customers. The Company filed for bankruptcy on January 20, 2006
(Bankr. E.D.N.C. Case No. 06-00166). Richard M. Hutson, II, is
the Chapter 11 Trustee. When the Debtor filed for bankruptcy, it
estimated between $1 million to $10 million in assets and
$10 million to $50 million in debts.
NATIONWIDE HEALTH: Plans to Sell 9 Million Common Shares
--------------------------------------------------------
Nationwide Health Properties, Inc. (NYSE: NHP) plans to make a
public offering of approximately 9,000,000 shares of its common
stock. Of those shares, a portion are being offered directly by
NHP and the remaining shares are being offered in connection with
forward sale agreements between NHP and certain affiliates of the
underwriters. The Company has granted to the underwriters of the
common stock offering an option to purchase up to approximately
1,350,000 shares of additional common stock, exercisable solely to
cover over-allotments.
NHP will use the net proceeds from the sale of such newly issued
shares to fund a portion of its acquisition and master leaseback
of the real estate holdings of Hearthstone Assisted Living, Inc.
In addition, NHP will enter into forward sale agreements with
affiliates of J.P. Morgan Securities Inc. and UBS Securities LLC,
which we refer to as the forward purchasers. The forward
purchasers (or their affiliates) will borrow and sell to the
underwriters shares of NHP's common stock. The forward sale
agreements provide for physical or cash settlement at the public
offering price at the time of this offering (less the
underwriters' discounts), subject to certain adjustments, within
approximately one year of the offering. NHP expects to physically
settle the forward sale agreements and use the proceeds to fund a
portion of the Hearthstone acquisition. NHP will not receive any
proceeds from the sale of shares of its common stock by the
forward purchasers (or their affiliates) unless the forward sale
agreements are physically settled.
The offering of the newly issued shares and the shares covered by
the forward sale agreements will be made under NHP's currently
effective shelf registration statement filed with the Securities
and Exchange Commission. The joint book-running managers for the
offering are J.P. Morgan Securities Inc. and UBS Securities LLC.
The co-managers for the offering are:
* A.G. Edwards & Sons, Inc.,
* Wachovia Capital Markets, LLC,
* Banc of America Securities LLC,
* Cohen & Steers Capital Advisors, LLC, and
* Cantor Fitzgerald & Co.
J.P. Morgan Securities Inc. will act as sole structuring agent for
the forward sale agreements.
Nationwide Health Properties, Inc. is a real estate investment
trust that invests in health care facilities and has investments
in 446 facilities in 39 states.
About Nationwide Health Properties
Headquartered in Newport Beach, California, Nationwide Health
Properties, Inc. -- http://www.nhp-reit.com-- is a real estate
investment trust that invests in senior housing and long-term care
facilities. The Company has investments in 447 facilities in 39
states in the United States.
* * *
As reported in the Troubled Company Reporter on Jan. 20, 2006,
Standard & Poor's Ratings Services affirmed its:
* 'BBB-' corporate credit rating;
* 'BBB-' senior unsecured debt rating; and
* 'BB+' preferred stock rating
on Nationwide Health Properties Inc.
The affirmations affect approximately $570 million in outstanding
senior unsecured notes and $197 million in preferred stock. The
outlook is stable.
NEWAVE INC: Recurring Losses Prompts Going Concern Doubt
--------------------------------------------------------
Jaspers + Hall, PC expressed substantial doubt about NeWave,
Inc.'s ability to continue as a going concern after auditing the
Company's financial statements for the year ended Dec. 31, 2005.
The auditing firm pointed to the Company's recurring losses from
operations.
The Company says that it is planning to finance its continued
operations for the next 12 months through cash generated from
operations or secure additional funding from its current
investors.
2005 Financials
For the 12 months ended Dec. 31, 2005, NeWave Inc. incurred a
$6,265,924 net loss on $7,340,399 of total revenues. For the 12
months ended Dec. 31, 2004, the Company incurred a $3,884,862 net
loss on $6,812,686 of total revenues.
At Dec. 31, 2005, NeWave's balance sheet showed $1,622,116 in
total liabilities and $4,476,380 in total liabilities. The
Company reports a $10,861,869 accumulated deficit at Dec. 31,
2005.
A full-text copy of NeWave's latest annual report is available for
free at http://ResearchArchives.com/t/s?70f
Headquartered in Goleta, California, NeWave, Inc. is a leading
online auction and e-commerce company, which through its wholly-
owned subsidiary "onlinesupplier.com", is engaged in providing
online solutions and tools to its customers for monthly membership
fees. NeWave provides its members with a commercial website,
hosting a merchant account (PayPal, Visa & Mastercard) and access
to thousands of high value products and value-added services.
Since inception in August of 2003, "onlinesupplier.com" has
serviced over 235,000 paid members.
As of Dec. 31, 2005, NeWave Inc.'s balance sheet shows a
$2,854,264 shareholders' equity deficit, compared to $24,774 of
positive equity at Dec. 31, 2004.
NORTEL NETWORKS: OSC Issues Cease Trade Order After Filing Delay
----------------------------------------------------------------
Nortel disclosed that the Ontario Securities Commission issued a
temporary order prohibiting all trading by certain current and
former directors, officers and employees in the securities of the
Company and its principal operating subsidiary, Nortel Networks
Limited.
The cease trade order follows the Company's announcement on
March 10, 2006, of the expected delay in filing the 2005 annual
reports on Form 10-K with the Securities and Exchange Commission
and corresponding Canadian filings.
Under OSC rules, the temporary order is expected to be replaced
with a permanent order within the next 15 days. The permanent
management cease trade order is expected to be in place until two
full business days following receipt by the OSC of all filings
that the Company and NNL are required to make pursuant to Ontario
securities laws.
The Company expects certain other provinces' commissions to also
issue similar orders with respect to residents in those
jurisdictions.
Headquartered in Ontario, Canada, Nortel Networks Corporation --
http://www.nortel.com/-- is a recognized leader in delivering
communications capabilities that enhance the human experience,
ignite and power global commerce, and secure and protect the
world's most critical information. Serving both service provider
and enterprise customers, Nortel delivers innovative technology
solutions encompassing end-to-end broadband, Voice over IP,
multimedia services and applications, and wireless broadband
designed to help people solve the world's greatest challenges.
Nortel does business in more than 150 countries.
Nortel Network Corp.'s 4-1/4% Senior Notes due 2008 carry Moody's
Investors Service's B3 rating and Standard & Poor's B- rating.
As previously reported in the Troubled Company Reporter on
Feb. 10, 2006, Standard & Poor's affirmed its 'B-' long-term and
'B-2' short-term corporate credit ratings on the company.
NORTEL NETWORKS: Opens Advanced Mobility Center in Argentina
------------------------------------------------------------
Nortel Networks Corp. (NYSE/TSX: NT) established a new customer
service center in Buenos Aires, Argentina, focused on services to
help wireless operators around the world design, deploy, support
and evolve their networks.
The new Advanced Mobility Services Center provides Nortel Global
Services offerings such as wireless network planning, deployment,
integration and optimization. This includes advanced engineering
expertise in radio frequency design for GSM, CDMA, UMTS and WiMAX
networks.
These services are designed to help operators speed time-to-market
for new subscriber services, enhance network performance, improve
coverage and efficiency, increase service quality, lower operating
costs and maximize return on network investments. They are also
intended to help operators seamlessly manage network expansion and
evolution to next-generation technologies.
"Establishing our Advanced Mobility Services Center in Argentina
is key in offering this market advanced mobility services for our
customers and partners and reflects Nortel's commitment and
investment in the services sector," said Martha Bejar, president,
Caribbean and Latin America, Nortel. "A key factor in choosing
Buenos Aires was the existing pool of high quality professionals
graduating from local universities."
The new center is expected to require growth of Nortel's total
workforce in the country by approximately 20%. The center will
consist of local engineers and its services will be marketed
around the world. The staff to be hired will include senior and
recently-graduated engineers, both with and without previous
experience in wireless and RF networks.
"Nortel continues to be one of the main equipment providers in the
region, and is committed to strengthening its position in the
global services market," said Ricardo Casal, president, Nortel
Argentina. "This new Center means that our people in Argentina
will play a key role in that effort."
About Nortel
Headquartered in Ontario, Canada, Nortel Networks Corporation --
http://www.nortel.com/-- is a recognized leader in delivering
communications capabilities that enhance the human experience,
ignite and power global commerce, and secure and protect the
world's most critical information. Serving both service provider
and enterprise customers, Nortel delivers innovative technology
solutions encompassing end-to-end broadband, Voice over IP,
multimedia services and applications, and wireless broadband
designed to help people solve the world's greatest challenges.
Nortel does business in more than 150 countries.
Nortel Network Corp.'s 4-1/4% Senior Notes due 2008 carry Moody's
Investors Service's B3 rating and Standard & Poor's B- rating.
As previously reported in the Troubled Company Reporter on
Feb. 10, 2006, Standard & Poor's affirmed its 'B-' long-term and
'B-2' short-term corporate credit ratings on the company.
ON TOP COMMS: Wants to Hire Leo Schaeffler as Financial Consultant
------------------------------------------------------------------
On Top Communications, LLC, and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Maryland for permission to
employ Leo C. Schaeffler, as its financial consultant, nunc pro
tunc to Jan. 9, 2006.
Mr. Schaeffler will provide general financial consulting services
to the Debtors, including, but not limited to, review and maintain
the Debtors' books and records and evaluate the Debtors' financial
status and financial affairs. The Debtors want Mr. Schaeffler to
work with the McShane Group. Mr. Schaeffler is affiliated with
the McShane Group pursuant to a subcontract agreement dated
January 15, 1997.
As reported in the Troubled Company Reporter on Mar. 1, 2006, the
Court approved John J. Robinson and the McShane Group's employment
as the Debtors' financial consultants.
The Debtors tell the Court that Mr. Schaeffler's work is necessary
because Mr. Robinson is no longer employed by the McShane Group
and is no longer acting as the Debtors' financial consultant.
Mr. Schaeffler's services, the Debtors say, will not be
duplicative of those services provided by the McShane Group.
Mr. Schaeffler will charge $250 per hour for his services.
To the best of the Debtors' knowledge, Mr. Schaeffler does not
hold any interest adverse to the Debtors or their creditors.
Headquartered in Lanham, Maryland, On Top Communications, LLC, and
its affiliates acquire, own and operate FM radio stations located
in the Southeastern United States. The Company and its debtor-
affiliates filed for chapter 11 protection on July 29, 2005
(Bankr. D. Md. Case No. 05-27037). Thomas L. Lackey, Esq., of
Bowie, Maryland, represents the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they estimated assets and debts of $10 million to
$50 million.
ON TOP COMMS: Wants Until April 19 to Make Lease-Related Decisions
------------------------------------------------------------------
On Top Communications, LLC, and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Maryland to further extend
until April 19, 2006, the period within which they can elect to
assume, assume and assign, or reject three unexpired
nonresidential real property leases for property located at
545 South Birdneck Road, in Virginia Beach, Virginia.
In connection with the operation of FM radio station WWHV, the
Debtor leases nonresidential real property from Birdneck Business
Center L.L.C. On Jan. 10, 2006, the Court approved the rejection
of two of five leases between the Debtor and Birdneck Business.
The Debtor continues to evaluate and analyze the three remaining
leases to determine whether it is in the best interest of the
estate to assume or reject the lease in light of their pending
decision to sell or reorganize the station. The Debtor reminds
the Court that it remains current on all postpetition rents
required under the lease.
Headquartered in Lanham, Maryland, On Top Communications, LLC, and
its affiliates acquire, own and operate FM radio stations located
in the Southeastern United States. The Company and its debtor-
affiliates filed for chapter 11 protection on July 29, 2005
(Bankr. D. Md. Case No. 05-27037). Thomas L. Lackey, Esq., of
Bowie, Maryland, represents the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they estimated assets and debts of $10 million to
$50 million.
PANTRY INC: 50 Noteholders May Resell Sr. Sub. Convertible Notes
----------------------------------------------------------------
The Pantry, Inc., issued a prospectus supplement listing the
50 holders of its 3% Senior Subordinated Convertible Notes due
2012 (and entitled to receive shares of common stock upon
conversion of the Notes) who may opt to resell the Notes.
The Company issued and sold $150,000,000 in aggregate principal
amount of its 3% Senior Subordinated Convertible Notes due 2012 in
a private offering, in November 2005.
A full-text copy of the Prospectus Supplement is available for
free at http://ResearchArchives.com/t/s?710
Terms of the Notes
The notes bear interest at the rate of 3% per year, payable in
cash semiannually in arrears on May 15 and November 15 of each
year, beginning May 15, 2006. The notes mature on November 15,
2012.
The notes are senior subordinated unsecured obligations of the
Company and rank:
-- junior in right of payment to all of its existing and future
senior debt;
-- equal in right of payment to all of its existing and future
senior subordinated unsecured debt; and
-- senior in right of payment to all of its future subordinated
debt.
The Company's obligations under the notes are fully and
unconditionally guaranteed on a senior subordinated basis by the
Company's existing and future domestic subsidiaries, other than
one subsidiary with no indebtedness and de minimis assets.
Holders may convert their notes based on a conversion rate of
19.9622 shares of common stock per $1,000 principal amount of
notes (which is equal to an initial conversion price of
approximately $50.09 per share), subject to adjustment under
certain circumstances.
The Company's common stock is quoted on the Nasdaq National Market
under the symbol "PTRY."
A full-text copy of the Prospectus is available for free at
http://ResearchArchives.com/t/s?711
Headquartered in Sanford, North Carolina, The Pantry, Inc. is the
leading independently operated convenience store chain in the
southeastern United States and one of the largest independently
operated convenience store chains in the country, with net sales
for fiscal 2005 of approximately $4.4 billion. As of September
29, 2005, the Company operated 1,400 stores in eleven states under
a number of banners including Kangaroo Express(SM), Golden
Gallon(R), and Cowboys(SM). The Pantry's stores offer a broad
selection of merchandise, as well as gasoline and other ancillary
services designed to appeal to the convenience needs of its
customers.
* * *
As reported in the Troubled Company Reporter on Nov. 17, 2005,
Moody's Investors Service rated the proposed secured bank loan and
senior subordinated convertible notes of The Pantry, Inc., at Ba3
and B3 and affirmed the existing senior subordinated notes at B3
and the corporate family rating at B1. Proceeds from the new debt
principally will be used to repay the existing term loan. Moody's
said the rating outlook remains stable.
As reported in the Troubled Company Reporter on Nov. 16, 2005
Standard & Poor's Ratings Services affirmed leading convenience
store operator The Pantry Inc.'s 'B+' corporate credit rating and
changed the outlook to positive from stable. At the same time,
Standard & Poor's assigned its 'BB-' bank loan rating to The
Pantry's proposed $205 million senior secured term loan due 2012
and $125 million revolving credit facility due 2012. The recovery
rating on the loan is '1', indicating the expectation for full
recovery of principal in the event of payment default.
At the same time, Standard & Poor's assigned its 'B-' rating to
the company's $130 million convertible senior subordinated
debentures due 2012 to be issued under Rule 144A. Ratings on the
company's existing senior subordinated notes were affirmed at
'B-'.
PETSMART INC: Reports $1.05 Bil. Net Sales for 4th Quarter 2005
---------------------------------------------------------------
PetSmart, Inc., reported net income of $70.9 million for the
fiscal fourth quarter of 2005, compared to the $65.0 million net
income for the same period in 2004. For all of fiscal 2005,
PetSmart's net income is $182.5 million, compared to fiscal 2004's
$157.5 million.
PetSmart's net sales for the fourth quarter of 2005 were $1.05
billion, compared to $934.3 million for the same period in 2004,
and comparable store sales -- or sales in stores open at least a
year -- grew 4.5% in the fourth quarter, on top of 4.6% in the
fourth quarter of 2004.
In 2005, the Company generated $3.76 billion in net sales, up from
$3.36 billion in net sales a year ago. Comparable store sales
grew 4.2% in 2005, on top of 6.3% growth in 2004.
The Company opened 36 new stores and closed one location during
the fourth quarter of 2005, which compares with 24 new stores and
no closures during the fourth quarter of 2004. During 2005, the
Company opened 107 new stores and closed seven locations, compared
with 92 new stores and nine closures in 2004.
Outlook
PetSmart projects comparable store sales in the low- to mid-single
digits for the first quarter of 2006 and in the mid-single digits
for the full year. It estimates earnings of $0.28 to $0.30 per
share in the first quarter and $1.37 to $1.39 per share for the
full year.
About PetSmart
Headquartered in Phoenix, Arizona, PetSmart, Inc. --
http://www.PetSmart.com/-- is the largest specialty retailer of
services and solutions for the lifetime needs of pets. The
company operates more than 825 pet stores in the United States and
Canada, a growing number of PetsHotels, as well as the Internet's
leading online provider of pet products and information. PetSmart
provides a broad range of competitively priced pet food and
supplies, and offers complete pet training, grooming and adoption
services. Since 1994, PetSmart Charities, an independent 501(c)3
organization, has donated more than $40 million to animal welfare
program and, through its in-store adoption programs, has saved the
lives of more than two million pets.
* * *
Moody's upgraded PetSmart's corporate family rating to Ba2 from
Ba3 on Jan. 5, 2004, and said the outlook is stable.
On Dec. 21, 2005, Standard & Poor's lifted the Company's long-term
foreign and local issuer credit ratings from BB- to BB, and said
the outlook is stable.
POPE & TALBOT: S&P Downgrades Sr. Unsecured Debt Rating to CCC+
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on pulp and lumber producer Pope & Talbot Inc. to 'B'
from 'B+' and its senior unsecured debt rating to 'CCC+' from
'B-'. The outlook is negative.
"The downgrade reflects our continuing concerns regarding Pope &
Talbot's very weak earnings, aggressive debt leverage, negative
cash flow, and expected meaningful drain on liquidity stemming
from seasonal working capital needs and elevated capital spending
for a sawmill expansion," said Standard & Poor's credit analyst
Dominick D'Ascoli.
The company has delayed the filing of its 2005 10-K but has
indicated that its losses in the fourth quarter increased (it
incurred a net loss of $8.8 million in the third quarter of 2005
and $16.5 million for the first nine months of 2005), and that it
does not expect to meet the 2x interest coverage ratio under its
Canadian revolving credit facility for the first quarter of 2006.
"We could lower the ratings if the Canadian dollar appreciates
further, pulp price increases are not realized, liquidity declines
more than currently expected, or the company is unable to obtain
waivers from its banks," Mr. D'Ascoli said. "We could revise the
outlook to stable if price increases are sufficient to reverse the
declining earnings trend and the company successfully refinances
its credit facilities and improves liquidity. We could also
revise the outlook to stable if the softwood lumber duties are
returned."
PREFERRED MOBILE: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Preferred Mobile Nurses, Inc.
aka Preferred Home Health
P.O. Box 413
Morrison, Colorado 80465
Tel: (303) 987-8128
Fax: (303) 987-9125
Bankruptcy Case No.: 06-11255
Type of Business: The Debtor provides qualified nursing personnel
and staff to different healthcare facilities.
See http://pmnurses.com/
Chapter 11 Petition Date: March 28, 2006
Court: District of Colorado (Denver)
Judge: Michael E. Romero
Debtor's Counsel: Jeffrey Weinman, Esq.
William A. Richey, Esq.
Weinman & Associates, P.C.
730 17th Street, Suite 240
Denver, Colorado 80202
Tel: (303) 572-1010
Total Assets: $808,000
Total Debts: $1,903,973
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Wausau Insurance $65,000
P.O. Box 8017
Wausau, WI 54402-8017
Nursing Spectrum $33,214
c/o United Mercantile
P.O. Box 1347
Gibsonia, PA 15044-1347
IMA $28,000
1500 17th Street, Suite 600
Denver, CO 80202-1202
AFCO $21,800
Advanta Bank Corp. $16,506
Rawlins Company, LLC $14,723
Cigna Healthcare $14,500
Advanstar $10,000
Backgrounds International $7,200
CCD Corporation $6,000
Thuerault, Leona $4,500
Irongate Offices, LLC $4,236
Qwest Dex $4,000
Medifis $3,000
Job Service North Dakota $1,721
Citicorp Vendor Finance, Inc. $1,698
Pitney Bowes Purchase Power $1,470
West Asset Management $1,445
Coastal $1,046
Pitney Bowes Purchase Power $977
PRIMUS TELECOMMS: Raises $5 Million from Private Equity Placement
-----------------------------------------------------------------
Sean O'Sullivan, as Trustee for the Sean O'Sullivan Revocable
Living Trust, purchased 6,666,667 shares of PRIMUS
Telecommunications Group, Inc.'s common stock for $5,000,000
in a private equity placement.
Mr. O'Sullivan is a self-employed engineer and entrepreneur who
from time to time makes purchases in public and private entities.
His principal business address is:
Sean O'Sullivan
Suite 132, PMB #123
6800 West Gate Blvd
Austin, Texas 78745
Prior to the private equity purchase, over a period of about one
year, Mr. O'Sullivan bought 4,000,000 of the Company's common
shares on the NASDAQ public market; 1,000,000 of these shares were
purchased for the benefit of his charitable foundation, The
O'Sullivan Foundation, for which Mr. O'Sullivan disclaims
ownership of the shares other than in terms of control of the
voting rights, by virtue his being the Trustee and Director of the
foundation.
The private equity purchase increased Mr. O'Sullivan's beneficial
ownership of the Company to 9.4%, represented by 10,666,667 common
shares.
The Company will use the funds for its general corporate
obligations and operations. Its issuance of 6,666,667 new common
shares raised the number of shares outstanding to approximately
113,776,004.
Headquartered in McLean, Virginia, PRIMUS Telecommunications
Group, Incorporated -- http://www.primustel.com/-- is an
integrated communications services provider offering international
and domestic voice, voice-over-Internet protocol (VOIP), Internet,
wireless, data and hosting services to business and residential
retail customers and other carriers located primarily in the
United States, Canada, Australia, the United Kingdom and western
Europe. Founded in 1994, PRIMUS provides services over its global
network of owned and leased transmission facilities, including
approximately 250 points-of-presence (POPs) throughout the world,
ownership interests in undersea fiber optic cable systems, 18
carrier-grade international gateway and domestic switches, and a
variety of operating relationships that allow it to deliver
traffic worldwide.
At Dec. 31, 2005, the company's balance sheet showed a
$236,334,000 stockholders' deficit, compared to a $108,756,000
deficit at Dec. 31, 2004.
RECKSON ASSOCIATES: REIT's Free Cash Flow Hits Eight-Year High
--------------------------------------------------------------
Reckson Associates Realty Corp. reported $50.8 million of diluted
funds from operations for the fourth quarter of 2005, compared to
the $44.4 million diluted FFO for the fourth quarter of 2004.
For the year ended Dec. 31, 2005, Reckson's diluted FFO is $198.6
million compared to the prior year's $161.4 million.
The Company's net income allocable to common shareholders for the
fourth quarter of 2005 is $49.0 million, compared to $4.5 million
for the fourth quarter of 2004.
For the year ended Dec. 31, 2005, the Company's net income
allocable to common shareholders is $197.6 million compared to the
prior year's $42.4 million.
Fourth Quarter Highlights
For the fourth quarter of 2005, the Company's achievements
include:
-- Reported FFO growth of 9% per share before non-recurring
charges;
-- Completed record leasing activity totaling 916,518 square
feet including a renewal rate of 79%;
-- Reported overall same property office occupancy of 94.6%;
-- Increased office same property NOI by 4.2% (on a straight-
line rent basis);
-- Increased consolidated office rent performance on renewal
and replacement space 15.4% (on a straight-line rent
basis); and
-- Completed approximately $569 million of investments and
approximately $470 million of dispositions in the quarter,
capping off a year in which the Company completed
approximately $1.3 billion of investments and approximately
$900 million of joint ventures and non-core asset
dispositions.
About Reckson Associates
Headquartered in Melville, New York, Reckson Associates Realty
Corp. -- http://www.reckson.com/-- is a self-administered and
self-managed real estate investment trust specializing in the
acquisition, leasing, financing, management and development of
Class A office properties. Reckson's core growth strategy is
focused on the markets surrounding and including New York City.
The Company is one of the largest publicly traded owners, managers
and developers of Class A office properties in the New York Tri-
State area, and wholly owns, has substantial interests in, or has
under contract, a total of 102 properties comprised of
approximately 20.2 million square feet.
* * *
On Nov. 12, 2003 and Jan. 28, 2004, Moody's and Fitch each
assigned speculative ratings to Reckson's preferred stock. Both
rating agencies say the outlook it stable.
REFCO INC: Wants to Sell Refco Japan Shares for $4,600,000
----------------------------------------------------------
Refco Japan Limited, a wholly owned subsidiary of Debtor Refco
Global Holdings, LLC, holds a securities brokering license with
the Japan Financial Securities Association. However, Refco Japan
has no clearing membership or customers and holds no customer
funds.
Historically, Refco Japan undertook marketing to institutional
customers, and referred customers to its Refco affiliate in
Singapore. Refco Japan is monitored by the Kanto Regional
Finance Bureau, a Japanese regulatory agency.
Sally McDonald Henry, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in New York, relates that when news of the alleged
fraud at Refco, Inc., surfaced in October 2005, institutional
clients ceased conducting business with Refco Japan. As a
result, Refco Japan has not been able to trade, nor earn income
from referrals.
Based on the results of their analysis of Refco Inc., and its
debtor-affiliates' ongoing and future business prospects, the
Debtors' management and financial advisors have concluded that the
best way to maximize the value of the Refco Japan common shares is
to sell them.
Since the Petition Date, Refco Japan was widely marketed by the
Debtors' advisors during the worldwide sale process. However,
Man Financial Inc., the winning bidder at an auction, was not
interested in purchasing Refco Japan. In addition, the KGFB
threatened to revoke Refco Japan's trading license if it was not
sold quickly, thus, forcing a liquidation.
After conducting due diligence and holding discussions with Refco
Japan's sales team, VC Square Toushi Kikin Uneikumiai Company
Limited, Encourage Entrepreneurship Fund Limited Partnership, VC
Square Company Limited, and Hachimine Noboru Office Company
Limited entered into a Purchase Share Agreement with Global
Holdings, pursuant to which the Purchasers will acquire 3,200
Shares for $4,600,000, a premium over both book value and the
expected liquidation value. Global Holdings will transfer the
Shares to the Purchasers free and clear of all pledges, security
interests, liens, charges, and claims and other encumbrances.
The Debtors believe that the Purchasers' offer is the highest and
best offer for the Shares under any circumstances.
The Debtors also assert that the lien and interest holders will
be adequately protected, because their liens and interests will
attach to the net proceeds of the sale, subject to any claims and
defenses the Debtors may possess.
Accordingly, the Debtors ask the U.S. Bankruptcy Court for the
Southern District of New York to allow Global Holdings to
consummate the Share Purchase Agreement under Section 363(f) of
the Bankruptcy Code.
About Refco Inc.
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. Luc A.
Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents
the Official Committee of Unsecured Creditors. 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. (Refco
Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
REFCO INC: Wants Court to Okay Miscellaneous Asset Sale Protocol
----------------------------------------------------------------
Since the Petition Date, Refco Inc., and its debtor-affiliateshave
sold a substantial portion of their assets, including assets
related to Refco, LLC. The Debtors also sought to sell other
assets, including assets and equity interests related to Refco F/X
Associates, LLC, Partners Capital Investment Group, L.L.C., and a
collection of artwork.
In connection with their continued wind-down efforts, the Debtors
anticipate the sale of many more assets of relatively small value
compared to the aggregate value of their assets currently held,
including:
* equity interests in foreign affiliates;
* interests in foreign corporations;
* foreign securities;
* foreign mutual funds; and
* minority ownership interest in small private domestic and
foreign entities.
Currently, the Debtors are marketing nearly 20 assets of that
nature.
In addition, the Debtors anticipate rejecting or otherwise
disposing of many of their real property leases. Following these
activities, the Debtors will also need to sell certain assets,
like computers, office furniture and other equipment.
To facilitate the formation and ultimate confirmation of a plan
of reorganization and to yield the highest possible returns to
their creditors, the Debtors ask the U.S. Bankruptcy Court for the
Southern District of New York to establish uniform procedures for
their contemplated sales of the Miscellaneous Assets, on an
expedited basis, pursuant to Sections 105(a) and 363 of the
Bankruptcy Code.
Specifically, the Debtors propose that the Miscellaneous Asset
Sales be structured in accordance with these Sale Procedures:
(1) Level 1 Sales
With respect to any single Miscellaneous Asset or its
related group with an expected sale price of less than
or equal to $150,000, the Debtors will be permitted to
accept and consummate any offer that they determine to
be fair and reasonable. Not later than the fifth
business day following the date on which any Level 1
Sales are actually consummated, the Debtors will provide
notice of the Level 1 Sale to counsel for the Official
Committee of Unsecured Creditors, counsel to the agent
for the Debtors' prepetition lenders, the United States
Trustee, and any other person or entity asserting an
interest in the Miscellaneous Assets sold.
(2) Level 2 Sales
With respect to any single Miscellaneous Asset with an
expected sale price of greater than $150,000 but less
than or equal to $1,000,000:
(a) As soon as practicable after a negotiation of a
definitive agreement for a Level 2 Sale, the
Debtors will provide to the Notice Parties a
written description of the Sale, identifying
the purchaser and its relationship to the Debtors,
the assets to be sold, the purchase price to be
paid, the book value of the assets and any other
available valuation, and marketing efforts for
the Miscellaneous Assets.
(b) If the Miscellaneous Asset Sale is to be conducted
by an auctioneer or liquidator, the Sale Summary
will only identify the time, place, and
description of assets to be sold. The Debtors'
insiders or affiliates will not be permitted to
participate at a Liquidation Sale.
(c) The Notice Parties will have until 5:00 p.m. to
review the Sale Summary on the 10th business day
following its delivery. However, if all Notice
Parties:
* affirmatively assent to the Level 2 Sale;
* fail to notify the Debtors of their objection
to the Level 2 Sale prior to the expiration
of the Level 2 Review Period; or
* fail to request additional time,
the Debtors will consummate the Level 2 Sale
without notice and a hearing or Court approval.
(d) If all objections by Notice Parties to a Level 2
Sale are withdrawn, the Debtors may consummate the
Level 2 Sale without further notice or Court
approval.
(e) If a Notice Party timely objects to the Level 2
Sale and does not withdraw the objection, the
Debtors may forego consummation of the Level 2
Sale, modify the terms of the Level 2 Sale that
would result in the withdrawal of any objections,
or seek to consummate the Level 2 Sale over the
objecting Notice Party's objection.
(f) The Debtors will undertake to inform and involve
in all subsequent discussions of the proposed
transaction the financial advisors to the
Committee and the Prepetition Agent.
(g) The Debtors will file with the Court, on a
quarterly basis, reports of all sales with a sale
price greater than $150,000 during that quarter.
The Reports will describe the property and its
location, the name of the purchaser and the sale
price.
Sally McDonald Henry, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in New York, tells Judge Drain that the proposed Sale
Procedures will:
-- conserve the Debtors' resources;
-- promote judicial economy;
-- make cost effective the smaller Miscellaneous Asset Sales
that otherwise would be prohibitively expensive; and
-- expedite the sale of more valuable assets in a cost
effective manner that provides the most benefit to the
Debtors' estates and creditors.
Ms. Henry states that all Miscellaneous Asset Sales will be made
free and clear of any liens, claims, interests or encumbrances of
any entity in the Miscellaneous Assets, unless otherwise agreed
by the parties to the Miscellaneous Asset Sale. Any party
asserting an Interest in the Miscellaneous Assets will be
protected by having that Interest attach to the net proceeds of
the sales, subject to any claims and defenses the Debtors may
possess.
Ms. Henry further notes that the Debtors will not be able to sell
Miscellaneous Assets to "insiders" or "affiliates" without
clearly disclosing that fact on the face of the notices to the
Notice Parties.
Moreover, the Debtors intend to compensate liquidators or brokers
for their services without further Court approval in connection
with the Miscellaneous Asset Sales. The Debtors did not specify
any broker's fee or commission rate.
The Debtors believe that the use of brokers and liquidators will
significantly aid in the timely disposition and realization of
the maximum possible value for the Miscellaneous Assets.
About Refco Inc.
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. Luc A.
Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents
the Official Committee of Unsecured Creditors. 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. (Refco
Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
RESI FINANCE: Moody's Watching & May Upgrade 4 Cert. Class Ratings
------------------------------------------------------------------
Moody's Investors Service placed 16 tranches issued by Real Estate
Synthetic Securities Investment Finance Limited Partnership 2003-A
and 2003-B on review for possible upgrade. The deals have high
credit enhancement levels compared to the expected loss
projections. The underlying collateral is performing better than
expected due to the high prepayment volumes, low delinquency
percentages, and low credit losses.
Complete rating actions are:
Issuer: RESI Finance Limited Partnership 2003-A
* Class B-3, Currently: A2; under review for possible upgrade.
* Class B-4, Currently: A3; under review for possible upgrade.
* Class B-5, Currently: Baa2; under review for possible upgrade.
* Class B-6, Currently: Baa3; under review for possible upgrade.
* Class B-7, Currently: Ba2; under review for possible upgrade.
* Class B-8, Currently: Ba3; under review for possible upgrade.
* Class B-9, Currently: B2; under review for possible upgrade.
* Class B-10, Currently: B3; under review for possible upgrade.
Issuer: RESI Finance Limited Partnership 2003-B
* Class B-3, Currently: A2; under review for possible upgrade.
* Class B-4, Currently: A3; under review for possible upgrade.
* Class B-5, Currently: Baa2; under review for possible upgrade.
* Class B-6, Currently: Baa3; under review for possible upgrade.
* Class B-7, Currently: Ba2; under review for possible upgrade.
* Class B-8, Currently: Ba3; under review for possible upgrade.
* Class B-9, Currently: B2; under review for possible upgrade.
* Class B-10, Currently: B3; under review for possible upgrade.
RODGER MCAFEE: Case Summary & 4 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Rodger L. McAfee
9960 West Manning Avenue
Fresno, California 93706
Bankruptcy Case No.: 06-10342
Chapter 11 Petition Date: March 27, 2006
Court: Eastern District of California (Fresno)
Judge: Whitney Rimel
Debtor's Counsel: Adrian S. Williams, Esq.
2440 West Shaw Avenue #114
Fresno, California 93711
Tel: (559) 226-7767
Fax: (559) 224-4960
Estimated Assets: $10 Million to $50 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 4 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
G. Arias Trucking Trucking $10,050
P.O. Box 208
Raisin, CA 93652
Mark Martin Maintenance and $4,292
5365 West Yale Construction
Fresno, CA 93722
Albert Medina Welding Work $3,300
10845 South Walnut Avenue
Fresno, CA 93706
Glenn Hepner Land Prep. And $2,400
P.O. Box 457 Planting
Raisin, CA 93652
SAINT VINCENTS: Settles Dispute with Mallinckrodt
-------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved a stipulation resolving Saint Vincents Catholic Medical
Centers of New York and its debtor-affiliates' dispute with
Mallinckrodt, Inc. The stipulation provides that:
(a) SVCMC will pay to Mallinckrodt, not later than March 22,
2006:
-- $27,822, which represents the cost of all postpetition
Warranty Services Mallinckrodt provided from the
Petition Date through March 8, 2006; plus
-- $40,000, in exchange for Mallinckrodt's provision of
Warranty Services for the period March 8, 2006, and
ending one year after.
(b) At the discretion of both parties, in exchange for the
continued provision of Warranty Services after the Initial
Warranty Period, SVCMC will pay to Mallinckrodt annually
thereafter (i) $40,000; or (ii) any amount agreed by the
parties. The Extended Warranty Period will not extend
beyond February 2010;
(c) In the event the Debtors sell either St. John's Hospital,
Queens, Mary Immaculate Hospital, Queens and St. Vincents
Hospital, Staten Island, during the Initial Warranty
Period or, if applicable, any Extended Warranty Period,
the purchaser of each Hospital will be entitled to the
Warranty Services for the Ventilators for the balance of
(i) the Initial Warranty Period; or (ii) if applicable,
the Extended Warranty Period.
Mallinckrodt will be required to provide Warranty Services
only for Ventilators that remain at the Hospitals at which
they are currently located;
(d) Any and all amounts paid by SVCMC to Mallinckrodt pursuant
to the Stipulation will be credited against (i) the
aggregate dollar amount of allowed prepetition claims
asserted by Mallinckrodt relating to the Ventilators or
the Warranty Services; or (ii) the cure amount, if any, in
the event SVCMC assumes Mallinckrodt's contractual
obligation to provide the Warranty Services; and
(e) Mallinckrodt may not terminate its obligations under the
Stipulation in the absence SVCMC's breach of the payment
obligations, which breach is not cured by SVCMC within 20
days of written notice and a further Court order
permitting the termination of Mallinckrodt's obligations.
As reported in the Troubled Company Reporter on Oct. 10, 2005, the
Debtors inadvertently shipped 840 ventilators belonging to
Mallinckrodt to Debtor Puritan Bennett.
While the Debtors intended to purchase the Equipment through a
lease agreement with a third party, there was no executed lease
agreement, and Mallinckrodt has not received payment for the
Equipment:
Number of Collective
Debtor Ventilators Price
------ ----------- ----------
St. Vincent's Catholic
Medical Center-Staten Island 10 $286,231
St. John's Queens Hospital 10 $310,661
Mary Immaculate Hospital 8 $249,128
Mallinckrodt contended that the Debtors had no legal or equitable
interest in the equipment, and their interest was merely bare
possession and asked the Court to lift the automatic stay so that
it can exercise its right to terminate service coverage. The
Debtors opposed this request.
Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency. The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951). Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, filed the Debtors' chapter 11 cases. On Sept. 12,
2005, John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP took
over representing the Debtors in their restructuring efforts.
Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, represents the
Official Committee of Unsecured Creditors. As of Apr. 30, 2005,
the Debtors listed $972 million in total assets and $1 billion in
total debts. (Saint Vincent Bankruptcy News, Issue No. 22;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
SAINT VINCENTS: GAIC Wants to Conduct Rule 2004 Inquiry
-------------------------------------------------------
Pursuant to Rule 2004 of the Federal Rules of Bankruptcy
Procedure, Great American Insurance Company asks the U.S.
Bankruptcy Court for the Southern District of New York to compel
Saint Vincents Catholic Medical Centers of New York and its
debtor-affiliates to produce documentation and information, to the
extent that they are within the Debtors' possession or control,
related to:
(a) restricted use accounts or other set asides or accounts
purportedly created by the Debtors relevant to two
judgments in favor of:
* Patsy Merola, in the action entitled Patsy Merola, as
Administrator of the Estate of Wanda Merola v. Catholic
Medical Center of Brooklyn & Queens, Inc., doing
business as St. John's Hospital, et al., commenced in
the Supreme Court of the State of New York, Queens
County; and
* Sondra Lowery, in the action entitled Sondra Lowery v.
Henry Lamaute, M.D., et al., commenced in the Supreme
Court of the State of New York, Queens County; and
(b) the insurance and self-insurance programs implemented by
the Debtors with respect to their medical malpractice
liabilities.
The Appeals
Under the Merola Action, the New York Supreme Court awarded Mr.
Merola judgment in the sum of $2,652,539.
St. John's, one of the hospitals operated by SVCMC, filed a
notice of appeal on the Merola Judgment.
Under the Lowery Action, the New York Supreme Court also awarded
Ms. Lowery judgment against Dr. Lamaute for $4,205,257.
Dr. Lamaute filed a notice of appeal on the Lowery Judgment.
The Appeal Bonds
To prevent each of Mr. Merola and Ms. Lowery from enforcing their
Money Judgments during the pendency of the Appeals, GAIC issued
an Undertaking on Appeal from a Judgment Directing the Payment of
Money on behalf of:
* St. John's dated November 7, 2003 -- Bond No. FS 6818788;
and
* Dr. Lamaute dated February 25, 2005 -- Bond No. FS 6338498.
St. John's and SVCMC also executed and delivered General
Indemnity Agreements to GAIC.
GAIC issued the two Appeal Bonds at St. John's and SVCMC's
request and partially in reliance on the General Indemnity
Agreements executed by St. John and SVCMC.
Pursuant to a Court-approved Stipulation, the Bankruptcy Court
allowed Mr. Merola to pursue recovery from GAIC under the Appeal
Bond.
In connection with the issuance of the Lowery Undertaking on
Appeal, the Debtors advised GAIC that there was excess
professional liability insurance partially covering the Lowery
Judgment totaling $2,000,000, comprised of:
-- $500,000 with Queensbrook Insurance Limited using AIG
paper;
-- $500,000 with Transatlantic Reinsurance Company, which is a
subsidiary of AIG; and
-- $1,000,000 with the Hospital Association of New York.
QIL and HANYS advised GAIC that their policies are not impaired
should the Appellate Court affirms the Lowery Judgment.
The Bankruptcy Court has set a conference and hearing for
March 29, 2006, to consider various proposals for the
administration and handling of the Debtors' insurance and self-
insurance with respect to medical malpractice claims.
Rule 2004 Examination is Necessary
Mark S. Gamell, Esq., at Torre, Lentz, Gamell, Gary & Rittmaster,
LLP, in Jericho, New York, explains that GAIC seeks to obtain
certain information from the Debtors and other third parties so
that:
(a) it will be properly informed and prepared to participate
in the March 29 hearing;
(b) the administration of the Debtors' bankruptcy proceedings
will not be delayed further; and
(c) its rights, both liquidated and contingent, as well as
those of the judgment creditors to whose rights it may
become subrogated with respect to the Debtors and their
various insurance and self-insurance programs, will be
protected.
Accordingly, GAIC seeks the Court's authority to:
(a) examine under oath prior to the Hearing, persons under the
direction and control of the Debtors; and
(b) issue subpoenas compelling the examination under oath of
persons no longer under the Debtors' direction and control
pursuant to Rule 45 of the Federal Rules of Civil
Procedure prior to the Hearing.
The scope of the examinations will be limited to the matters in
GAIC's request, Mr. Gamell assures the Court.
The Debtors advised GAIC that some of the requested information
is not in their possession or control or their current employees,
and must be gathered from the examination of non-debtor sources,
Mr. Gamell informs the Court.
Debtors Object
John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP, in New
York, asserts that some of GAIC's discovery requests appear
overly broad given its stated purpose.
Mr. Rapisardi contends that the timing provided for responding to
discovery requests is unnecessarily accelerated, as issues to be
decided at the Hearing are predominantly procedural and in any
event do not affect the rights of bond issuers like GAIC.
Many of the requested documents related to the Trusts may contain
information that is privileged or otherwise non-disclosable.
Thus, the Debtors ask the Court to protect the confidentiality of
those documents.
Mr. Rapisardi tells the Court that the Debtors have prepared a
stipulation, which provides for all of GAIC's requests and
addresses their concerns with regard to the confidential nature
of the requested information.
The Stipulation has been provided to GAIC's counsel, who has not
yet been able to respond to it, according to Mr. Rapisardi.
Mr. Rapisardi tells Judge Hardin that the Stipulation:
(a) balances the needs of both parties by providing reasonable
and sufficient authority to GAIC under Rule 2004 to
conduct examinations and compel the production of
documents while protecting their rights to maintain the
confidentiality of privileged or otherwise non-disclosable
information; and
(b) provides a reasonable timeline for them to respond to
GAIC's information requests.
The Stipulation provides that the Debtors will produce documents
and information, to the extent that they are under the Debtors'
possession, to GAIC no later than April 30, 2006. GAIC may also,
no later than May 15, 2006:
(i) examine under oath persons under the Debtors' direction
and control; and
(ii) issue subpoenas, compelling examination under oath, to
those persons no longer under the Debtors' direction and
control.
Accordingly, to the extent that the Court limits its approval of
GAIC's request to the terms of the Stipulation, the Debtors have
no further objection.
However, if the Court will not limit its approval, the Debtors
continue their objection.
Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency. The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951). Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, filed the Debtors' chapter 11 cases. On Sept. 12,
2005, John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP took
over representing the Debtors in their restructuring efforts.
Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, represents the
Official Committee of Unsecured Creditors. As of Apr. 30, 2005,
the Debtors listed $972 million in total assets and $1 billion in
total debts. (Saint Vincent Bankruptcy News, Issue No. 22;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
SAKS INC: Posts $2.2MM Net Loss for Quarter Ended Jan. 28, 2006
---------------------------------------------------------------
Retailer Saks Incorporated recorded a net loss of $2.2 million,
for the fourth quarter ended Jan. 28, 2006, compared to a
$96.6 million net income for the prior year fourth quarter ended
Jan. 29, 2005.
For the current year fourth quarter, the Company's consolidated
comparable store sales increased 1.9% while total revenues
declined 14.2%.
For the fiscal year ended Jan. 28, 2006, the Company recorded net
income of $22.3 million, compared to the Company recorded net
income of $61.1 million for the prior fiscal year ended Jan. 29,
2005.
For the fiscal year, the Company's consolidated comparable store
sales grew 2.1%, and total sales declined 7.5%.
Balance Sheet Highlights
The Company ended the quarter with approximately $80 million of
cash on hand and no outstanding borrowings on its $800 million
revolving credit facility.
The Company repurchased approximately $607 million of senior notes
during the year, and as a result, total debt at Jan. 28, 2006
declined from one year ago by nearly 50% to approximately $731
million, and debt-to-capitalization was 26.8%.
The Company increased its common share repurchase authorization by
35 million shares during the fourth quarter of 2005. The Company
purchased 12.9 million shares of common stock during the year for
a total of approximately $224 million. The Company has remaining
availability of approximately 37.8 million shares under its 70
million share repurchase authorization.
2006 Financial Forecasts
The management believes that these assumptions are reasonable for
2006:
-- Interest expense approximating $50 million, a significant
decline from 2005 levels due to reduced indebtedness;
-- Depreciation and amortization ranging from $160 million to
$170 million, decreasing over 2005 expense due to the
elimination of its Proffitt's and McRae's department store
and Northern Department Store Group from the store base;
and
-- An effective tax rate of approximately 40.0%.
For the full year, management expects net capital spending will
total approximately $175 million to $200 million.
Other Store News
In 2005, the Company opened a 90,000 square foot Parisian store in
Gadsden, Alabama and opened a new prototype 130,000 square foot
Parisian store in Collierville, Tennessee.
During the year, the Company closed five underperforming stores to
better allocate resources to its most productive units.
The Company has plans to open new Parisian stores in Birmingham,
Alabama in fall 2006; Little Rock, Arkansas in fall 2006; Detroit,
Michigan in 2007; and Rogers, Arkansas in 2007.
About Saks Inc.
Headquartered in Birmingham, Alabama, Saks Incorporated --
http://www.saksincorporated.com/-- operates Saks Fifth Avenue
Enterprises, which consists of 55 Saks Fifth Avenue stores, 50
Saks Off 5th stores, and Saks.com. The Company also operates 39
Parisian stores and 57 Club Libby Lu specialty stores. On
Jan. 9, 2006, the Company announced it is exploring strategic
alternatives for Parisian.
* * *
On July 20, 2005, Standard & Poor's upgraded Saks Inc.'s long-term
issuer credit ratings to B+ from CCC+.
In November 2005, Moody's and Fitch assigned the Company highly
speculative senior unsecured debt ratings. Additionally, Fitch
rated the Company's bank debt at BB with a negative outlook.
Moody's placed the Company's corporate family rating at B2 with a
positive outlook.
SEITEL INC: Balance Sheet Upside-Down by $11.2 Million at Dec. 31
-----------------------------------------------------------------
Seitel, Inc. (OTC Bulletin Board: SELA) disclosed its financial
results for the fourth quarter and year ended Dec. 31, 2005, to
the Securities and Exchange Commission on Mar. 16, 2006.
The company reported revenue of $41.4 million for the fourth
quarter ended December 31, 2005, compared to $33.9 million for the
same period in 2004. Revenue for the quarter grew 68 percent on a
sequential basis and 22 percent year-on-year. Cash resales
reached a record level of $32 million, compared to $28.1 million
for the fourth quarter of 2004. For the quarter ended Dec. 31,
2005, cash resales increased 58 percent sequentially and 14
percent year-on-year. This represents the fifth consecutive
quarter of year-on-year growth in cash resales as demand for
seismic data remained strong. For the fiscal year 2005, cash
resales increased to $97.5 million from $80.3 million in 2004.
For the fourth quarter of 2005, net income was $1.4 million
compared to a net loss of $5.6 million in the fourth quarter of
last year. This represents the first profitable quarter since the
second quarter of 2003.
"Our return to profitability is a testament to the successful
execution of our business strategy," stated Rob Monson, chief
executive officer. "We have been steadily improving on our
execution and continue to grow and leverage our large data
library. As a result, our balance sheet continues to strengthen,
with a cash balance that grew to $78 million at year end."
"The industry environment remains favorable and we expect demand
for seismic data to grow during 2006 in line with the expected
increase in E&P spending in North America," continued Mr. Monson.
"Our 3D library grew over 2,100 square miles in 2005 and should
continue to grow significantly in 2006. We also expect to
increase our portfolio of value added, technologically advanced
product offerings. Seitel is now better equipped than ever to
take advantage of the opportunities available to us during the
coming years."
The company reported operating income of $7.4 million in the 2005
fourth quarter compared to an operating loss of $2 million in the
2004 fourth quarter. Operating income for the 2005 full year was
$15.7 million compared to an operating loss of $61 million in the
prior year. Depreciation and amortization expense for the fourth
quarter of 2005 was $22 million compared to $29 million for the
same period in 2004. For the full year in 2005, depreciation and
amortization expense fell to $98.4 million from $168.2 million for
the prior year. Amortization expense for 2004 included $59.1
million resulting from the change in useful life of the company's
data. The 2005 periods reflect lower amortization resulting from
the effects of the level of revenue recognized on data with fully
amortized costs.
For the year ended Dec. 31, 2005, the company reported a net loss
of $1.7 million compared to a net loss of $92.1 million in 2004.
The 2004 period includes the following non-recurring charges:
i) a $59.1 million amortization charge resulting from the
change in useful life of the company's data from seven to
four years;
ii) $12.5 million in reorganization charges, which includes
costs related to restructuring efforts and bankruptcy
proceedings; and
iii) $2.3 million in additional interest expense due to the
overlapping of newly issued and retiring senior notes.
2005 includes a tax benefit of $4.8 million, which primarily
resulted from the reversal of the valuation allowance provided
against the deferred tax asset in
Canada. During 2005, management determined that it was more
likely than not that this deferred tax asset would be realized.
2004 results include a tax benefit of $3.3 million primarily
related to tax refunds in the U.S. and Canada.
Cash margin, defined as cash revenues other than from data
acquisition less cash expenses, is the indicator management
believes best measures the level of cash from operations that is
available for debt service and capital expenditures, net of
underwriting. Cash margin grew 10 percent and 32 percent for the
2005 three and twelve month periods to $24.5 million and $72.3
million.
As of Dec. 31, 2005, the company's balance sheet shows $246.7
million in total assets and $257.8 million in total debts
resulting to a $11.2 million stockholders' equity deficit.
Headquartered in Houston, Texas, Seitel, Inc. (OTC Bulletin Board:
SELA) -- http://www.seitel-inc.com/-- founded in 1982, has grown
to become the owner of one of the largest seismic data libraries
providing information to the North American oil and gas market.
Focused on the U.S. and Canada, the company owns data in all the
major exploration and production basins. Seitel continues to grow
the data library using its 20 years of experience in performing
seismic surveys in North America. Seitel's strengths include
expertise in managing and delivering seismic data, as well as an
experienced and dynamic sales and marketing team. Seitel's
seismic data library includes both onshore and offshore three-
dimensional (3D) and two-dimensional (2D) data and offshore multi-
component data. The company has ownership in over 35,000 square
miles of 3D and approximately 1.1 million linear miles of 2D
seismic.
SENIOR HOUSING: Former Parent Selling 10.7% Stake for $135.71 Mil.
------------------------------------------------------------------
HRPT Properties Trust is selling all of its holdings in Senior
Housing Properties Trust, comprising of 7,710,738 of Senior
Housing's common shares, for $135,708,989 at $17.60 per share.
Senior Housing used to be a wholly owned subsidiary of HRPT
Properties until October 1999. On October 12, 1999, a majority of
Senior Housing's then outstanding shares were distributed to HRPT
shareholders. At that time, HRPT Properties retained 12,809,238
of Senior Housing's outstanding shares. HRPT Properties now owns
7,710,738 of Senior Housing's outstanding shares, comprising a
10.7% equity stake in Senior Housing.
HRPT Properties is selling the common shares through two
underwriters:
Underwriters Number of Shares
------------ ----------------
UBS Securities LLC 3,855,369
Wachovia Capital Markets, LLC 3,855,369
----------------
Total 7,710,738
The Underwriters will receive $2,390,329 from discounts and
commissions. HRPT Properties will net $133,318,660, before
expenses, from the sale.
A full-text copy of the Underwriting Agreement is available for
free at http://ResearchArchives.com/t/s?708
Senior Housing will not receive anything from the proceeds.
Senior Housing's common shares are listed on the New York Stock
Exchange under the symbol "SNH".
A full-text copy of the Prospectus is available for free at
http://ResearchArchives.com/t/s?707
Senior Housing Properties Trust is a real estate investment trust,
or REIT, which invests in senior housing properties, including
apartment buildings for aged residents, independent living
properties, assisted living facilities and nursing homes. As of
December 31, 2005, we owned 188 properties located in 32 states
with a book value of $1.7 billion before depreciation.
* * *
Senior Housing Properties Trust's senior unsecured debt gets
Fitch's BB+ rating and Moody's Ba3 rating. The outlook for both
ratings is stable.
STARWOOD HOTELS: S&P Affirms BB+ Ratings on $600 Million Sr. Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' ratings on
Starwood Hotels & Resorts Worldwide Inc. subsidiary ITT Corp.'s:
* $450 million senior unsecured notes, and
* $150 million senior unsecured notes.
These ratings were removed from CreditWatch, where they were
placed with negative implications Nov. 15, 2005. The action
reflects the expectation that these obligations will be assumed by
Starwood (previously they were guaranteed by Starwood) and not by
Host Marriott Corp. (BB-/Stable/--), a lower rated entity, in
connection with Starwood's agreement to sell 38 hotels to Host for
stock and cash worth $4.1 billion (at the time of the
announcement). In lieu of the debt transfers, Starwood will
receive an additional cash consideration of $600 million from
Host and would likely redeem the $150 million notes.
All other existing ratings for Starwood were affirmed, including
the 'BB+' corporate credit rating. The rating outlook is
positive.
In November 2005, Starwood announced that it would sell 38 hotels
totaling almost 19,000 rooms to Host for $4.1 billion. With the
assumption of $600 million in ITT notes by Starwood, the cash
component of the purchase price will increase to almost $1.7
billion. In addition, $2.3 billion in Host stock will be paid to
Starwood's shareholders (although the equity component of the
purchase price has increased since the announcement due to
appreciation in Host's stock price), and Host will assume $100
million of Starwood's debt. Of the almost $1.7 billion total cash
consideration, Starwood will receive $1.54 billion and its
shareholders will directly receive $122 million.
Cash proceeds received by Starwood from the Host transaction,
expected proceeds from asset sales in 2006 of more than $400
million, and about $900 million in unrestricted cash balances as
of December 2005 are expected to allow the company to repay
maturing debt balances of $450 million and make share repurchases
over the intermediate term. As of January 2006, there was more
than $900 million of availability under Starwood's share
repurchase authorization. In addition, the company defeased $470
million in mortgage-backed debt in February 2006.
"The rating on White Plains, New York-based Starwood reflects its
large, high quality, and geographically diversified hotel
portfolio with many well-established brand names," said Standard &
Poor's credit analyst Emile Courtney. "This is partly tempered by
the sensitivity of lodging demand to economic cycles and the
company's exposure to the performance of its largest owned
hotels."
STELCO INC: Gives Update on Finalized and Approved Plan Documents
-----------------------------------------------------------------
Stelco Inc. issued an update in the matter of the finalization and
approval of principal documents as the Company moves towards
implementation of its restructuring plan, expected to occur on
March 31, 2006.
As reported in the Troubled Company Reported on March 27, 2006,
Stelco reported the proposed amendment of its restructuring plan
to change certain terms of the New Secured Floating Rate Notes to
be issued under the plan. The Company indicated at that time that
the proposed amendments had the consent or support of the Court-
appointed Monitor, Tricap Management Limited and the Province of
Ontario.
Additionally, Stelco was awaiting confirmation from the other
equity sponsors and indication from the Senior Bondholder Steering
Committee that the Company could proceed with the proposed
amendments.
Stelco reported that those confirmations and indications have now
been received.
Restructuring Plan Documents
The Company also reported that the terms of various material
documents and agreements contemplated by Stelco's restructuring
plan have now been finalized.
These documents include the Company's ABL Loan Agreement, its
Secured Revolving Term Loan Agreement, the Secured Floating Rate
Note Trust Indenture under which the Company will issue secured
notes, the Province Loan Agreement and Pension Agreement, the
Intercreditor Agreement, the Province Intercreditor Agreement, and
the Warrant Indenture.
The documents are available at no charge at:
a) New Platform Trust Indenture
http://bankrupt.com/misc/1661.pdf
b) Supplemental Indenture
http://bankrupt.com/misc/1656.pdf
c) New Inter-creditor Agreement
http://bankrupt.com/misc/1657.pdf
d) Province Inter-creditor Agreement
http://bankrupt.com/misc/1658.pdf
e) New Province Note Loan Agreement;
http://bankrupt.com/misc/1659.pdf
f) New Warrant Indenture, and
http://bankrupt.com/misc/1655.pdf
g) Pension Agreement with the Province of Ontario
http://bankrupt.com/misc/1660.pdf
About Stelco
Stelco is expected to emerge from its Court-supervised
restructuring on March 31, 2006. At that time, new common shares
will be issued under the approved restructuring plan and are
expected to begin trading on the TSX on April 3, 2006, subject to
certain conditions.
Stelco, Inc. -- http://www.stelco.ca/-- is a large, diversified
steel producer. Stelco is involved in all major segments of the
steel industry through its integrated steel business, mini-mills,
and manufactured products businesses. The company is currently in
the final stages of a Court-supervised restructuring. This
process is designed to establish the Company as a viable and
competitive producer for the long term. The new Stelco will be
focused on its Ontario-based integrated steel business located in
Hamilton and in Nanticoke. These operations produce high quality
value-added hot rolled, cold rolled, coated sheet and bar
products.
In early 2004, after a thorough financial and strategic review,
Stelco concluded that it faced a serious viability issue. The
Corporation incurred significant operating and cash losses in 2003
and believed that it would have exhausted available sources of
liquidity before the end of 2004 if it did not obtain legal
protection and other benefits provided by a Court-supervised
restructuring process. Accordingly, on Jan. 29, 2004, Stelco and
certain related entities filed for protection under the Companies'
Creditors Arrangement Act.
The Court extended the stay period under Stelco's Court-supervised
restructuring from Dec. 12, 2005, until March 31, 2006.
SYDNEYCO LLC: Case Summary & 2 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Sydneyco LLC
904 16th Street
Bedford, Indiana 47421
Bankruptcy Case No.: 06-90378
Chapter 11 Petition Date: March 27, 2006
Court: Southern District of Indiana (New Albany)
Debtor's Counsel: David M. Cantor, Esq.
Seiller Waterman LLC
462 4th Avenue, Suite 2200
Louisville, Kentucky 40202
Tel: (502) 584-7400
Debtor's financial condition as of March 20, 2006:
Total Assets: $715,000
Total Debts: $1,609,975
Debtor's 2 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Fifth Third Bank Real Property $990,000
P.O. Box 630041
Cincinnati, OH 45263-0041
McIntrye Bros. Real Property $619,975
1020 7th Street
Bedford, IN 47421
TITANIUM METALS: Earns $38.6 Million in Fourth Quarter of 2005
--------------------------------------------------------------
Titanium Metals Corporation (NYSE: TIE) reported operating
income of $63.0 million and net income attributable to common
stockholders of $38.6 million for the quarter ended Dec. 31, 2005,
compared to operating income of $17.8 million and net income
attributable to common stockholders of $15.9 million for the
quarter ended December 31, 2004. The 2004 amounts have been
restated for the effects of the Company's previously reported
change in its method for inventory costing.
The Company's net sales increased 61% to $220.8 million during the
fourth quarter of 2005 compared to net sales of $137.0 million
during the fourth quarter of 2004, due to increases in both
average selling prices and sales volumes. Mill product average
selling prices increased 39% and melted product average selling
prices increased 62% during the fourth quarter of 2005, compared
to the fourth quarter of 2004. Mill product sales volume
increased 15% while melted product sales volume increased 8%
during the fourth quarter of 2005, compared to the fourth quarter
of 2004.
For the full year 2005, the Company reported operating income of
$171.1 million and net income attributable to common stockholders
of $143.7 million compared to operating income of $43.0 million
and net income attributable to common stockholders of
$43.3 million for the full year 2004.
Net sales for the full year 2005 increased 49% to $749.8 million
compared to net sales of $501.8 million during 2004, due to
increases in both average selling prices and sales volumes. Mill
product average selling prices increased 30% and melted product
average selling prices increased 48% during 2005, as compared to
2004. Mill product sales volume increased 11% while melted
product sales volume increased 6% during 2005, as compared to
2004.
Other non-mill product sales during the fourth quarter and full
year of 2005 increased 49% and 66%, respectively, compared to the
year ago periods due principally to higher selling prices for
titanium scrap and improved demand for the Company's fabrication
products. Such sales accounted for $5.9 million and $21.1 million
of additional operating income during the fourth quarter and full
year of 2005, respectively, as compared to the year ago periods.
Operating income during the fourth quarter and full year of 2005
was adversely impacted by higher costs for raw materials as
compared to the year ago periods.
The Company's backlog at the end of December 2005 was a record
$870 million, a $160 million (23%) increase over the $710 million
backlog at the end of September 2005 and a $420 million (93%)
increase over the $450 million backlog at the end of December
2004.
The Company's aggregate unused borrowing availability under its
U.S. and European credit agreements approximated $123 million at
December 31, 2005.
Steven L. Watson, CEO, said, "2005 was a tremendous year for TIMET
as we achieved our highest sales revenue, operating income and net
income attributable to common stockholders in the entire history
of the Company. The titanium market outlook is currently as
strong as we've ever seen it, and we expect market conditions to
remain strong for at least the next several years. We currently
expect our full year 2006 net sales revenue to range from
$1.0 billion to $1.1 billion, which is an increase of 35% to 50%
from 2005. This increase is primarily driven by significant
increases in melted product average selling prices (expected to
increase by 75% to 80% as compared to 2005) and mill product
average selling prices (expected to increase by 25% to 30% as
compared to 2005). Although raw material and other costs will
likely continue to increase in 2006, the Company expects to
achieve significant operating income growth. We currently expect
2006 full year operating income to range from $257 million to
$282 million, which is a 50% to 65% increase from operating income
earned in 2005."
Headquartered in Denver, Colorado, Titanium Metals Corporation --
http://www.timet.com/-- is a worldwide producer of titanium metal
products.
* * *
As reported in the Troubled Company Reporter on Mar. 18, 2005,
Standard & Poor's Ratings Services raised its corporate credit
rating on Denver, Colorado-based Titanium Metals Corp., to 'B+'
from 'B'. Standard & Poor's also raised its preferred stock
rating to 'CCC+' from 'CCC'. S&P says the outlook is stable.
TP&J CORP: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: TP&J Corporation
P.O. Box 668
Seymour, Indiana 47274
Bankruptcy Case No.: 06-90379
Chapter 11 Petition Date: March 27, 2006
Court: Southern District of Indiana (New Albany)
Debtor's Counsel: Neil C. Bordy, Esq.
Seiller & Handmaker LLC
462 South 4th Avenue, Suite 2200
Louisville, Kentucky 40202-3459
Tel: (502) 584-7400
Total Assets: $5,450,000
Total Debts: $3,687,189
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Indiana Department of Revenue $200,000
N248 Ind. Government Center
100 North Senate Avenue
Indianapolis, IN 46278
Internal Revenue Service $157,929
P.O. Box 21126
Philadelphia, PA 19114
Treasurer of Jackson County $136,750
111 South Main Street
Brownstown, IN 47220
Exide Technologies Transport $100,385
Mawdi Uni-Select USA $44,678
G&G Oil Co. of Indiana Inc. $41,624
Bartholomew County Treasurer $39,559
Middle Atlantic Warehouse Inc. $36,884
Crowder Realty LLC $32,365
American Express $25,235
Indiana Oxygen $23,045
Cumberland Products Inc. $22,544
BSI North American $21,130
Central Power Systems $18,549
Gardner $18,337
Treasurer of Lawrence $17,964
Manifest Funding Services $17,685
GE Capital $17,430
EI DuPont De Nemours Co. $17,050
Polyfreeze LLC $16,298
U.S. CAN: Sells U.S. & Argentinean Operations to Ball Corporation
-----------------------------------------------------------------
Ball Corporation (NYSE: BLL) completed its acquisition of the
United States and Argentinean operations of U.S. Can Corporation,
adding to Ball's portfolio of packaging products and making Ball
the largest supplier in the U.S. of aerosol cans, primarily for
food and household products.
Ball acquired 10 manufacturing plants in seven states and two
plants in Argentina. The operations have sales of approximately
$600 million, employ 2,300 people and produce more than two
billion steel aerosol containers annually. In addition to aerosol
cans, the acquired operations produce paint cans, plastic
containers and custom and specialty cans.
Ball reported early this month that it had hired can industry
veteran Michael W. Feldser to head up the acquired U.S. Can
operations. He will be president of Ball's aerosol & specialty
packaging division.
"We are pleased to have this acquisition closed so the integration
process can begin," said R. David Hoover, president and chief
executive officer. "We have a track record for successful
integration of acquired businesses, and we intend to build on that
record."
Ball reported that the former U.S. Can headquarters in a leased
building in Lombard, Illinois, will be closed. Functions that had
been performed there will be transferred to Ball offices near
Denver, moved to a plant in Elgin, Illinois, that is part of the
acquisition or in certain cases eliminated. The number of U.S.
Can employees who will receive employment opportunities with Ball
will be determined in the coming weeks, based upon anticipated
needs, interest in relocation and other factors as the integration
process continues.
"We will implement plans to welcome new employees, meet with
customers and suppliers and begin to realize the synergy savings
we are certain exist and to identify others," Mr. Hoover said.
"We expect to realize consolidation opportunities in the future as
we fully integrate the people and plants into Ball. Closing the
former headquarters is a first step and should help facilitate the
integration process. We believe this is a business that will
benefit considerably from being a part of a larger packaging
organization, and that our existing packaging businesses will
benefit from having them as part of Ball."
Raymond J. Seabrook, senior vice president and chief financial
officer, said the refinancing of the U.S. Can debt was
accomplished at significantly lower rates through the issue by
Ball of a new series of senior notes and an increase in bank debt
under new facilities that were put in place in the fourth quarter
of 2005.
About Ball Corp.
Headquartered in Broomfield, Colorado, Ball Corporation --
http://www.ball.com/-- is a supplier of high-quality metal and
plastic packaging products and owns Ball Aerospace & Technologies
Corp., which develops sensors, spacecraft, systems and components
for government and commercial customers. Ball reported 2005 sales
of $5.7 billion and the company employs 13,100 people worldwide.
About U.S. Can Corp.
Headquartered in Lombard, Illinois, U.S. Can Corporation --
http://www.uscanco.com/-- manufactures steel containers for
personal care, household, automotive, paint and industrial
products in the United States and Europe, as well as plastic
containers in the United States and food cans in Europe.
At Oct. 2, 2005, U.S. Can's balance sheet showed a $426,657,000
equity deficit, compared to a $398,429,000 deficit at Dec. 31,
2004.
* * *
As reported in the Troubled Company Reporter on Mar. 6, 2006,
Moody's Investors Service placed ratings of United States Can
Company, the operating subsidiary of U.S. Can Corporation under
review, following announcement that U.S. Can will sell its U.S.
and Argentinean operations to Ball Corporation.
These ratings are under review:
* $65 million senior secured first lien revolving credit
facility, rated B3
* $250 million senior secured first lien term loan B, rated B3
* $125 million second lien 10.875% notes due July 10, 2010,
rated Caa2
* $172 million 12.375% senior subordinated notes due Oct. 1,
2010, rated Caa3
* Corporate Family Rating, B3
As reported in the Troubled Company Reporter on Feb. 20, 2006,
Standard & Poor's Ratings Services placed its ratings, including
its 'B' corporate credit rating, on U.S. Can Corp. and its wholly
owned subsidiary, United States Can Co., on CreditWatch with
developing implications. This follows the announcement that
U.S. Can has entered into a definitive agreement to sell its
U.S. and Argentinean operations to Ball Corp. (BB+/Stable/--) for
1.1 million shares of Ball common stock and the repayment of
approximately $550 million of U.S. Can's debt.
USI HOLDINGS: Fitch Assigns BB- Rating to Loan Credit Facility
--------------------------------------------------------------
Fitch Ratings assigned a 'BB-' rating to USI Holdings
Corporation's five-year secured term loan credit facility.
Additionally, Fitch affirmed the 'BB-' issuer default rating on
USIH. The Rating Outlook is Stable.
Fitch's rating actions come in response to the recent closing of
USIH's restructured bank credit facilities, including both the
above mentioned $210 million secured term loan and a $75 million
revolving line of credit.
Fitch views the restructuring of USIH's bank credit facilities
positively as Fitch believes the new structure enhances the
company's liquidity and financial flexibility for future growth
while it still limits financial leverage and promotes adherence to
financial projections. In addition to increasing the credit
facilities size, the terms provide for an 'accordion' feature in
both facilities to add further borrowing capacity without lender
approval. The credit facilities continue to be secured by USIH's
stock.
Additionally, Fitch's rating continues to reflect:
* USIH's adequate capitalization and recent operating
performance improvement;
* good cash flow and financial flexibility;
* niche market position; and
* management experience.
Partially offsetting these positives include:
* historically high financial leverage;
* a significant amount of intangible assets related to USIH's
past acquisition activity;
* lower (albeit improving) operating margins relative to
middle-market peers;
* a lack of business diversity relative to the large global
brokers; and
* the effects of a softening property/casualty insurance
market.
Although 2005 operating results were negatively affected by the
sale of discontinued businesses, operating performance and balance
sheet strength have continued to improve as USIH has taken steps
to improve operating margins, reduce debt, and consistently
generate positive cash flow. Year-ended 2005 pretax operating
income from continuing operations was $30.7 million versus $28.7
million in 2004.
Historically, USIH's growth strategy was focused on quick growth
through acquisitions, resulting in high debt and goodwill levels
as well as integration issues. At Dec. 31, 2005, total debt-to-
total capital was 36.6% and goodwill was 98.9% of equity. Fitch
views USIH's current transition toward an organic growth focus
with a greater emphasis on client retention and cross-selling,
with only select strategic acquisitions and improved expense
control, as a positive development.
Although USIH has less business diversity than the largest global
brokers, it is a leading provider of employee benefits brokerage
services in addition to its property/casualty brokerage
operations. Employee benefits business tends to be counter-
cyclical to the property/casualty market. USIH's employee
benefits business generates 35.9% of the company's total
commission and fee revenues.
Fitch assigned this rating:
USI Holdings Corporation:
-- $210 million secured term loan due March 24, 2011 'BB-'
Fitch affirmed this rating with a Stable Outlook:
USI Holdings Corporation:
-- Issuer default affirmed at 'BB-'
USI HOLDINGS: Inks New $285 Million Senior Secured Credit Facility
------------------------------------------------------------------
USI Holdings Corporation (Nasdaq: USIH) closed on a new
$285 million senior secured credit facility. The new facility
consists of a $210 million term loan and a $75 million revolving
credit facility with final maturities in 2011.
In addition, the Company has restructured several financial
covenants and other limitations as part of the new facility to
enhance financial and operating flexibility.
Proceeds from the new term loan facility drawn on the closing date
were used to refinance all outstanding amounts under the existing
credit facility and amounts under the new revolving credit
facility will be used for general corporate purposes.
In connection with this transaction, the Company will record
expense of approximately $2.1 million to write-off the unamortized
deferred financing costs on the prior credit facility.
About USI Holdings Corporation
Founded in 1994, USI -- http://www.usi.biz/-- is a leading
distributor of insurance and financial products and services to
businesses throughout the United States. USI is headquartered in
Briarcliff Manor, New York, and operates out of 71 offices in 19
states.
* * *
As reported in the Troubled Company Reporter on Feb. 17, 2006,
Moody's Investors Service assigned a B1 rating to the new senior
secured credit facilities to be arranged by USI Holdings
Corporation. Proceeds from the new facilities will be used to
refinance all outstanding amounts under the company's existing
credit facilities and for general corporate purposes.
USIH currently has an approximate $210 million senior secured term
loan due in 2008 and a $30 million senior secured revolving credit
due in 2007. The purpose of the refinancing is to increase the
total amount of the facilities, enhance financial and operating
flexibility and extend maturities. The rating outlook is stable.
VENTURE HOLDINGS: Court Okays Pepper Hamilton as Special Counsel
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan
approved the request of Stuart A. Gold, Chapter 7 Trustee
overseeing the liquidation of Venture Holdings Company, LLC, and
its debtor-affiliates, to employ Pepper Hamilton LLP as its
special counsel.
Pepper Hamilton is expected to assist the Trustee in prosecuting
preference lawsuits during the Chapter 7 proceedings. Mr. Gold is
required to prosecute the preference lawsuits for the benefit of
the Debtors' estates.
Before the conversion of the Debtors' chapter 11 case to a
liquidation proceeding under chapter 7, Pepper Hamilton served as
special conflicts counsel to the Debtors.
The Firm filed approximately 40 preference lawsuits on behalf of
the Debtors; 26 of these lawsuits are still pending on the Court's
docket. Through its preparation and handling of the preference
lawsuits, Pepper Hamilton is keenly aware of the facts and known
legal issues in these actions.
Additionally, the Firm, prior to the chapter 7 conversion, also
provided valuable and essential counsel to the Company's Official
Committee of Unsecured Creditors as its co-counsel.
Dennis S. Kayes, Esq., a partner at Pepper Hamilton, discloses
that the Firm's professionals bill:
Professional Hourly Rate
------------ -----------
I. William Cohen, Esq. $575
Dennis S. Kayes, Esq. $495
Hannah J. Mufson, Esq. $250
Mary-Ellen Alexsy $155
Judy Suter $135
Mr. Kayes assures the Court that the Firm 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, Venture Holdings Company, LLC,
nka NM Holdings Company, LLC, and its debtor-affiliates filed for
chapter 11 protection (Bankr. E.D. Mich. Case No. 03-48939) on
March 28, 2003. Deluxe Pattern Corporation and its debtor-
affiliates filed for chapter 11 protection on May 24, 2004 (Bankr.
E.D. Mich. Case No. 04-54977). Venture's prepetition lenders
acquired Venture's assets during the chapter 11 proceeding. John
A. Simon, Esq., at Foley & Lardner LLP represent the Debtors.
John A. Karaczynski, Esq., and Robert M. Aronson, Esq., at Akin
Gump Strauss Hauer & Feld LLP, and Joel D. Applebaum, Esq., at
Clark Hill PLC represent the Creditors' Committee.
VICORP RESTAURANTS: S&P Lowers Senior Unsecured Debt Rating to B-
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Denver-based restaurant operator VICORP Restaurants Inc.
to 'B' from 'B+'. The senior unsecured debt rating was lowered to
'B-' from 'B'. The outlook is negative. Total debt outstanding
as of Jan. 26, 2006, was $275 million.
"The downgrade is based on the continuation of lackluster
operating performance and resulting credit measures that are below
our expectations," said Standard & Poor's credit analyst Robert
Lichtenstein.
Same-store sales decreased 0.1% in the first quarter of fiscal
2006, following a 1.3% decline in all of fiscal 2005. Moreover,
operating margins for the 12 months ended Jan. 26, 2006, fell to
16.5%, from 15% a year earlier. Margins were negatively affected
by higher costs, including:
* occupancy,
* utility, and
* marketing expenses.
As a result, leverage increased, with total debt to EBITDA at 6.5x
for the 12 months ended Jan. 26, 2006.
The ratings reflect:
* VICORP's participation in the weak family-dining sector of
the highly competitive restaurant industry;
* its relatively small size;
* weak cash flow protection measures; and
* a highly leveraged capital structure.
VICORP operates two family dining restaurant concepts:
* Village Inn, and
* Bakers Square.
The company commands a small market position in the family-dining
sector. This sector has underperformed the overall restaurant
industry and has weaker growth prospects because of changing
consumer preferences as well as competition from restaurants in
the:
* casual,
* fast-casual, and
* quick-service sectors.
Despite weak operating performance, VICORP's management plans to
open about 25 stores in fiscal 2006.
WEST BROTHERS : Case Summary & 19 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: West Brothers Grading Co., Inc.
658 McEntyre Loop Southeast
Calhoun, Georgia 30701
Tel: (706) 602-7501
Bankruptcy Case No.: 06-40481
Type of Business: The Debtor is a grading contractor.
Chapter 11 Petition Date: March 28, 2006
Court: Northern District of Georgia (Rome)
Judge: Mary Grace Diehl
Debtor's Counsel: James R. McKay, Esq.
Fuller & McKay, Attorneys at Law
P.O. Box 6063
Rome, Georgia 30162-6063
Tel: (706) 295-1300
Total Assets: Unknown
Total Debts: $1,946,489
Debtor's 19 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
David & Patricia West $312,474
658 McEntyre Loop Southeast
Calhoun, GA 30701
Dakota Financial $270,000
1875 Century Park East, Suite 2570
Los Angeles, CA 90067
Southeast Culvert $108,941
P.O. Box 896
Lawrenceville, GA 30246
S.A. White $82,204
Chase Cardmember Services $28,761
Gordon West $27,900
McArthur Concrete $20,227
Ford Motor Credit $15,538
Fran Alexander $12,850
Marmac Oil Co. $11,337
Dean & Moore Insurance Co. $9,322
Hanson Pipe & Products $9,224
US Filter $7,972
Calhoun Precase $6,979
Thomas West $6,550
Smithville Ind. Inc. $6,252
Hays & Potter P.C. $6,252
Foby Norman & Assoc. $5,988
Charles Martin $5,560
WICKES INC: Has Until May 24 to Solicit Acceptances of Plan
-----------------------------------------------------------
The Honorable Bruce W. Black of the U.S. Bankruptcy Court for the
Northern District of Illinois, Eastern Division, extended, until
May 24, 2006, Wickes Inc.'s time to solicit acceptances of its
plan of liquidation from its creditors.
The Debtor says the extension is necessary because:
-- its bankruptcy case is large and complex,
-- it has made good faith progress toward an orderly and
successful liquidation by completing the sale of
substantially all of its assets, and
-- it will give the Debtor additional time to resolve many
administrative matters to allow for a consensual plan of
liquidation.
Headquartered in Vernon Hills, Illinois, Wickes Inc. --
http://www.wickes.com/-- is a retailer and manufacturer of
building materials, catering to residential and commercial
building professionals, repairs and remodeling contractors and
project do-it-yourself consumers. Wickes, Inc., and GLC Division,
Inc., filed for chapter 11 protection on January 20, 2004 (Bankr.
N.D. Ill. Case No. 04-02221). The Court dismissed GLC's case on
Feb. 17, 2005. Richard M. Bendix Jr., Esq., at Schwartz, Cooper,
Greenberger & Krauss and Steven J. Christenholz, Esq., David N.
Missner, Esq., and Deborah M. Gutfeld, Esq., at DLA Piper Rudnick
Gray Cary US LLP represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, it listed $155,453,000 in total assets and $168,199,000
in total debts.
WORLDSPAN LP: Incurs $3.2 Million Net Loss in Fourth Quarter 2005
-----------------------------------------------------------------
For the fourth quarter 2005, Worldspan, L.P.'s revenue is $207.8
million, down 2% from revenue of $213.1 million in the fourth
quarter of 2004.
Worldspan's fourth quarter 2005 operating income is $10.5 million,
an improvement of $5.4 million, compared to the same period in
2004. The improvement, the Company says, reflects lower employee
costs, lower communication and technology expenses, lower
maintenance expenses, lower rental expenses and lower other
expenses.
The Company's net loss for the quarter is $3.2 million compared to
a net loss of $5.6 million in the fourth quarter of 2004. The
Company's year-over-year improvement in operating income was
partially offset by additional interest expense of $6.6 million,
in the quarter, as a result of their refinancing in February of
2005.
The Company generated $31.7 million in cash from operations during
the fourth quarter of 2005 compared to $37.4 million in the fourth
quarter of 2004. Cash capital spending was $4.8 million in the
fourth quarter of 2005, an increase of $0.6 million from the $4.2
million cash capital spending a year ago. Principal payments on
the term loan were $11 million, representing mandatory payments of
$1 million and discretionary
payments of $10 million.
The Company's annual revenue in 2005 is $953.8 million, up 1% from
revenue of $944.2 million in 2004, while its operating income for
2005 increased 31% to $116.1 million from $88.5 million in 2004.
For the full year 2005, the Company's net loss is $0.7 million,
compared to net income of $41.9 million in 2004. The reduction,
the Company notes, was due to a $55.6 million charge relating to
its refinancing in the first quarter of 2005.
The Company generated $150.0 million in cash from operations
during 2005 compared to $149.4 million in 2004. Its cash capital
spending is $14.1 million in 2005, an increase of $0.3 million
from the $13.8 million cash capital spending a year ago. The
Company ended the year with a cash balance of $58.1 million.
About Worldspan
Headquartered in Atlanta, Georgia, Worldspan, L.P. --
http://www.worldspan.com/-- is a leader in travel technology
services for travel suppliers, travel agencies, e-commerce sites
and corporations worldwide. Utilizing some of the fastest, most
flexible and efficient networks and computing technologies,
Worldspan provides comprehensive electronic data services
linking approximately 800 travel suppliers around the world to a
global customer base. Worldspan offers industry-leading Fares and
Pricing technology such as Worldspan e-Pricing(R), hosting
solutions, and customized travel products. Worldspan enables
travel suppliers, distributors and corporations to reduce costs
and increase productivity with technology like Worldspan
Go!(R) and Worldspan Trip Manager(R) XE.
* * *
On Jan. 31, 2005, Moody's junked Worldspan's senior subordinate
debt rating and assigned highly speculative ratings on the
Company's senior secured and bank loan debts including its
corporate family rating.
Standard & Poor's downgraded the Company's long-term issuer credit
ratings from B+ to B on Feb. 14, 2005, with a stable outlook.
* Thacher Proffitt Hires Richard Hans as Litigation Group Partner
-----------------------------------------------------------------
Thacher Proffitt & Wood LLP, a 158-year-old law firm, reported
that Richard Hans has joined the Firm as a partner in the
Litigation & Dispute Resolution Practice Group, resident in the
New York office, effective March 27, 2006. Mr. Hans joins Thacher
Proffitt from DLA Piper Rudnick Gray Cary.
"We are delighted to welcome Richard to our Firm," said Paul D.
Tvetenstrand, managing partner of Thacher Proffitt. "Richard will
enhance our financial services platform and is a natural
complement to our existing litigation practice."
"Richard brings to Thacher significant experience in commercial
and securities litigation," according to John M. Woods, chairman
of Thacher Proffitt's Litigation and Dispute Resolution Practice
Group. "His abilities and experience will complement our existing
practice and broaden our services to financial institutions,
corporations, foreign governments, insurance companies, and
governmental agencies."
About Richard Hans
Mr. Hans' practice focuses on director and officer, and
professional, liability insurance, insurance and reinsurance,
banking and securities matters, and corporate governance. His
clients include international and domestic insurance companies,
Fortune 500 companies, investment firms and commercial banks.
Before joining Thacher Proffitt, Richard worked at DLA Piper, King
& Spalding, and Skadden Arps.
Mr. Hans received his JD from St. John's University School of Law,
cum laude, and was the Executive Publications Editor of St. Johns
Law Review. He received his BS, with merit, from the U.S. Naval
Academy. He is admitted to the New York bar, as well as US Court
of Appeals for the Second Circuit, US District Court for the
Southern District of New York, and US District Court for the
Eastern District of New York.
Mr. Hans is a member of the Federal Bar Council; American Bar
Association Task Force on Corporate Governance; New York State Bar
Association Commercial and Federal Litigation Section; New York
Guild of Catholic Lawyers; and Professional Liability Underwriting
Society.
About Thacher Proffitt & Wood LLP
A law firm that focuses on the capital markets and financial
services industries, Thacher Proffitt -- http://www.tpw.com--
advises domestic and global clients in a wide range of areas,
including corporate and financial institutions law, securities,
structured finance, investment funds, swaps and derivatives,
cross-border transactions, real estate, commercial lending,
insurance, admiralty and ship finance, litigation and dispute
resolution, technology and intellectual property, executive
compensation and employee benefits, taxation, trusts and estates,
bankruptcy, reorganizations and restructurings. The Firm has 275
lawyers with five offices located in New York City; Washington,
DC; White Plains, New York; Summit, New Jersey; and Mexico City.
The Firm has been named top issuers' counsel and ranks in first
place for securitizations (Thomson Financial, mid-year 2005
rankings). The Firm also ranks in first place in asset-backed
securities for both issuer's and underwriter's counsel (The New
York Law Journal).
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
March 30, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Reception and Presentation on Certified
Turnaround Professional Program
Fennemore Craig, Phoenix, Arizona
Contact: http://www.turnaround.org/
March 30, 2006
TURNAROUND MANAGEMENT ASSOCIATION
TMAssist - Commercial Loan Workout Workshop
Marriott New Orleans, Louisiana
Contact: http://www.turnaround.org/
March 30, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Gary Sutton: Turnaround Practitioner & Author
Solera, Minneapolis, Minnesota
Contact: http://www.turnaround.org/
March 30-31, 2006
PRACTISING LAW INSTITUTE
Commercial Real Estate Financing: What Borrowers &
Lenders Need to Know Now
Chicago, Illinois
Contact: http://www.pli.edu/
March 30 - April 1, 2006
AMERICAN LAW INSTITUTE - AMERICAN BAR ASSOCIATION
Partnerships, LLCs, and LLPs: Uniform Acts, Taxation,
Drafting, Securities, and Bankruptcy
Scottsdale, Arizona
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
April 1-4, 2006
NORTON INSTITUTES ON BANKRUPTCY LAW
Bankruptcy Law Institute
The Flamingo, Las Vegas, Nevada
Contact: 770-535-7722 or
http://www2.nortoninstitutes.org/
April 3, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Fundraiser for Make-A-Wish Foundation
Bookbinder's Restaurant, Philadelphia, Pennsylvania
Contact: 215-657-5551 or http://www.turnaround.org/
April 4, 2006
BEARD AUDIO CONFERENCES
Reverse Mergers - the New IPO? David Feldman
Audio Conference
Contact: 240-629-3300; or
http://www.beardaudioconferences.com/
April 4, 2006
TURNAROUND MANAGEMENT ASSOCIATION
April Fools Networking Cocktail Reception
University Club, New York, New York
Contact: 646-932-5532 or http://www.turnaround.org/
April 5-8, 2006
MEALEYS PUBLICATIONS
Insurance Insolvency and Reinsurance Roundtable
Fairmont Scottsdale Princess, Scottsdale, Arizona
Contact: http://www.mealeys.com/
April 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Commercial Lenders Breakfast
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
April 6-7, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
The Seventh Annual Conference on Healthcare Transactions
Successful Strategies for Mergers, Acquisitions,
Divestitures, and Restructurings
The Millennium Knickerbocker Hotel, Chicago,
Illinois
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
April 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Poker Night & Mixer
Vancouver, British Columbia
Contact: 403-294-4954 or http://www.turnaround.org/
April 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Board Meeting
Much Shelist, Chicago, Illinois
Contact: 815-469-2395 or http://www.turnaround.org/
April 11, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Comedy Night at Governors
TBA, Levittown, New York
Contact: 631-251-6296 or http://www.turnaround.org/
April 12, 2006
TURNAROUND MANAGEMENT ASSOCIATION
The Great Debate
ANZ Bank, Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
April 12, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriott Tyson's Corner, Vienna, Virginia
Contact: 703-912-3309 or http://www.turnaround.org/
April 12, 2006
BEARD AUDIO CONFERENCES
Fundamentals of Corporate Bankruptcy and Restructuring
Audio Conference
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
April 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Monthly Dallas/Ft. Worth meeting
CityPlace Center, Dallas, Texas
Contact: 214-228-9706 or http://www.turnaround.org/
April 18-22, 2006
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
JW Marriott, Washington, D.C.
Contact: 1-703-739-0800; http://www.abiworld.org/
April 18, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Key Indicators in Financial Distress
Kansas City, Missouri
Contact: http://www.turnaround.org/
April 19, 2006
PRACTISING LAW INSTITUTE
Residential Real Estate Contracts & Closings
New York, New York
Contact: http://www.pli.edu/
April 25, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Citrus Club, Orlando, FL
Contact: 561-882-1331 or http://www.turnaround.org/
April 25, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Fraud and Forensic Accounting in a Restructuring Context
Duquesne Club, Pittsburgh, Pennsylvania
Contact: http://www.turnaround.org/
April 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Dinner with The Honourable Allan Wachowich, Chief Justice of
the Court of Queen's Bench of Alberta
Petroleum Club, Edmonton, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
April 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
TBA
Syracuse, New York
Contact: 716-440-6615 or http://www.turnaround.org/
April 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Panel Program on the Role of Trustees and Examiners &
Networking Reception
Arizona
Contact: http://www.turnaround.org/
May 2006
TURNAROUND MANAGEMENT ASSOCIATION
Regional Golf Event
TBD, Austin (tentative), Texas
Contact: 214-228-9706 or http://www.turnaround.org/
May 2, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Organization of Women
Di Bruno Bros., Philadephia, Pennsylvania
Contact: 215-657-5551 or http://www.turnaround.org/
May 3, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Fundamentals of Turnaround Management for SMEs
University of Technology, Sydney, Australia
Contact: http://www.turnaround.org/
May 4, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Texas Hold 'em Networking Event
TBA, St. Louis, Missouri
Contact: 815-469-2935 or http://www.turnaround.org/
May 4, 2006
TURNAROUND MANAGEMENT ASSOCIATION
InterChapter Texas Hold 'em
TBA - Missouri
Contact: 815-469-2935 or http://www.turnaround.org/
May 4, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Commercial Lenders Breakfast
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
May 4-6, 2006
AMERICAN LAW INSTITUTE - AMERICAN BAR ASSOCIATION
Fundamentals of Bankruptcy Law
Chicago, Illinois
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
May 5, 2006
AMERICAN BANKRUPTCY INSTITUTE
Nuts & Bolts for Young Practitioners
Alexander Hamilton Custom House, New York, New York
Contact: 1-703-739-0800; http://www.abiworld.org/
May 5, 2006
TURNAROUND MANAGEMENT ASSOCIATION
The Amendments to the Bankruptcy Code - Seven Months Later
Mid-Day Club, Chicago, Illinois
Contact: http://www.turnaround.org/
May 7-9, 2006
INTERNATIONAL BAR ASSOCIATION
Restructuring Among the Ruins
Hotel Bretagne
Athens, Greece
Contact: harriet.rowland@int-bar.org or
http://www.ibanet.org/
May 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Women's Golf 101
TBA - New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
May 8, 2006
AMERICAN BANKRUPTCY INSTITUTE
NYC Bankruptcy Conference
Millennium Broadway, New York, New York
Contact: 1-703-739-0800; http://www.abiworld.org/
May 10, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Center Club, Baltimore, Maryland
Contact: 703-912-3309 or http://www.turnaround.org/
May 10, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Function
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
May 11, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Casino Night
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
May 11, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Wicked Theatre Event
Oriental Theatre, Chicago, Illinois
Contact: 815-469-2935 or http://www.turnaround.org/
May 17, 2006
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
Bankers Club, Miami, FL
Contact: 561-882-1331 or http://www.turnaround.org/
May 18, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
TBA, Bergen County, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
May 18, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Eastside Wine & Dine
TBA, Seattle, Washington
Contact: 503-223-6222 or http://www.turnaround.org/
May 18, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Troubled Loan Workout Seminar
National Cable Television Center & Museum, Denver, CO
Contact: http://www.turnaround.org/
May 18, 2006
TURNAROUND MANAGEMENT ASSOCIATION
13 Week Cash Flow Workshop
Standard Club, Chicago, Illinois
Contact: http://www.turnaround.org/
May 18, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Forensic Accounting (Arizona Chapter Meeting)
Arizona
Contact: http://www.turnaround.org/
May 18-19, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Annual Great Lakes Regional Conference and Golf Tournament
Ellicottville, New York
Contact: 716-440-6615 or http://www.turnaround.org/
May 18-19, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Third Annual Conference on Distressed Investing Europe
Maximizing Profits in the European Distressed Debt Market
Le Meridien Piccadilly Hotel, London, UK
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
May 22, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Women's Golf 101
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
May 22, 2006
TURNAROUND MANAGEMENT ASSOCIATION
LI TMA Annual Golf Outing
Indian Hills Golf Club, Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
May 23-26, 2006
AMERICAN BANKRUPTCY INSTITUTE
5th ABI Litigation Skills Symposium
King and Spalding LLP, Atlanta, Georgia
Contact: 1-703-739-0800; http://www.abiworld.org/
May 24, 2006
TURNAROUND MANAGEMENT ASSOCIATION
"Toot Your Own Horn" Forum
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
May 25, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Doctor Heal Thyself - Health Care Turnaround
Portland, Oregon
Contact: http://www.turnaround.org/
May 30, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Session
TBA, Vancouver, British Columbia
Contact: 403-294-4954 or http://www.turnaround.org/
May 30, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
June 1, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Commercial Lenders Breakfast
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
June 1-2, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Southeast Regional Conference
Amelia Island, Florida
Contact: 410-347-7391 or http://www.turnaround.org/
June 5, 2006
TURNAROUND MANAGEMENT ASSOCIATION
TMA NY Golf & Tennis Outing -
MEMBERS & SPONSORSHIP REGISTRATION
Fresh Meadow Country Club, Lake Success, New York
Contact: 646-932-5532 or http://www.turnaround.org/
June 7-10, 2006
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
22nd Annual Bankruptcy & Restructuring Conference
Grand Hyatt, Seattle, Washington
Contact: http://www.airacira.org/
June 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Series #2
Ernst & Young Tower, Calgary, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
June 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Hedge Fund / Private Equity Round Table
CityPlace Center, Dallas, Texas
Contact: http://www.turnaround.org/
June 8-9, 2006
MEALEYS PUBLICATION
Asbestos Bankruptcy Conference
Ritz-Carlton Hotel, Chicago, Illinois
Contact: http://www.mealeys.com/
June 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
How Are the Old Clients Doing?
Duquesne Club, Pittsburgh, Pennsylvania
Contact: http://www.turnaround.org/
June 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Annual Charity Golf Outing
Harborside Golf Course, Chicago, Illinois
Contact: 815-469-2935 or http://www.turnaround.org/
June 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Golf Outing / Spouse Social
Portland, Oregon
Contact: 503-223-6222 or http://www.turnaround.org/
June 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Signature Luncheon, Charity Event
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
June 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriot Tyson's Corner, Vienna, Virginia
Contact: 703-912-3309 or http://www.turnaround.org/
June 14, 2006 (tentative)
TURNAROUND MANAGEMENT ASSOCIATION
LI TMA Texas Hold'em for Charity
Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
June 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Afghanistan - The Ultimate Turnaround Challenge
Oak Hill Country Club, Rochester, New York
Contact: http://www.turnaround.org/
June 15-18, 2006
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
June 20, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
TBA, Morristown, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
June 21-23, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Global Educational Symposium
Hyatt Regency, Chicago, Illinois
Contact: http://www.turnaround.org/
June 22-23, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Ninth Annual Conference on Corporate Reorganizations
Successful Strategies for Restructuring Troubled
Companies
The Millennium Knickerbocker Hotel, Chicago,
Illinois
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
June 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
June 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
What to Do When Internal Crime Strikes Your Company
New Jersey
Contact: http://www.turnaround.org/
June 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
5th Annual Lenders Panel - Arizona Chapter
National Bank of Arizona Conference Center, Phoenix, AZ
Contact: http://www.turnaround.org/
June 29 - July 2, 2006
NORTON INSTITUTES ON BANKRUPTCY LAW
Bankruptcy Law Institute
Jackson Lake Lodge, Jackson Hole, Wyoming
Contact: 770-535-7722 or
http://www2.nortoninstitutes.org/
July 11, 2006
TURNAROUND MANAGEMENT ASSOCIATION
The New Bankruptcy Code Nine Months Later
Rivers Club, Pittsburgh, Pennsylvania
Contact: http://www.turnaround.org/
July 12, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Function
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
July 12, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Center Club, Baltimore, Maryland
Contact: 703-912-3309 or http://www.turnaround.org/
July 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Women's Event
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
July 13-16, 2006
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Newport Marriott, Newport, Rhode Island
Contact: 1-703-739-0800; http://www.abiworld.org/
July 18, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
Marriott, Red Bank, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
July 18-19, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Distressed & Turnaround Investing Congress
Swiss"tel The Drake, New York, New York
Contact: http://www.turnaround.org/
July 19, 2006
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
South Florida
Contact: 561-882-1331 or http://www.turnaround.org/
July 25, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
July 26-29, 2006
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz Carlton Amelia Island, Amelia Island, Florida
Contact: 1-703-739-0800; http://www.abiworld.org/
July 31, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Annual Golf & Tennis Outing
Raritan Valley Country Club, Bridgewater, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
July 31, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Summer Social BBQ
Colonial Springs Country Club, Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
August 3, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Commercial Lenders Breakfast
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
August 3-5, 2006
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
August 9, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Professional Development Meeting
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
August 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
DIP Panel Discussion
Kansas City, Missouri
Contact: http://www.turnaround.org/
August 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Family Night Baseball with the NJ Jackals
(Yogi Berra Autograph Night)
Jackals Stadium, Montclair, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
August 25, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Annual Fishing Trip
Point Pleasant, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
August 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
4th Annual Alberta Golf Tournament
Kananaskis Country Golf Course, Kananaskis, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
September 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Business Mixer
TBA, Seattle, Washington
Contact: 503-223-6222 or http://www.turnaround.org/
September 7-8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Saratoga Regional Conference
Gideon Putnam Hotel, Saratoga Springs, New York
Contact: http://www.turnaround.org/
September 7-9, 2006
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Wynn Las Vegas, Las Vegas, Nevada
Contact: 1-703-739-0800; http://www.abiworld.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriott Tyson's Corner, Vienna, Virginia
Contact: 703-912-3309 or http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
TBA, Secaucus, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
LI Turnaround Formal Event
Long Island, New York
Contact: http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Function
Sydney, Australia
Contact: 0438 653 179 or www.turnaround.org
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Formal Event - Major Speaker to be Announced
Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
September 17-24, 2006
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
Optional Alaska Cruise
Seattle, Washington
Contact: 800-929-3598 or http://www.nabt.com/
September 20, 2006
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
Bankers Club, Miami, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 24, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Restructuring the Troubled High Tech Company
Arizona
Contact: http://www.turnaround.org/
September 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Joint Education Program with NYIC Joint Reception
CFA/RMA/IWIRC
Woodbridge Hilton, Iselin, NJ
Contact: http://www.turnaround.org/
September 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
7th Annual Cross Border Business Restructuring and
Turnaround Conference
Banff, Alberta
Contact: http://www.turnaround.org/
October 5, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Commercial Lenders Breakfast
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
October 10, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Center Club, Baltimore, Maryland
Contact: 703-912-3309 or http://www.turnaround.org/
October 11, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Professional Development Meeting
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
October 11-14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
2006 Annual Conference
Milleridge Cottage, Long Island, New York
Contact: 312-578-6900; http://www.turnaround.org/
October 17, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Updates on the New Bankruptcy Law
Kansas City, Missouri
Contact: http://www.turnaround.org/
October 19, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Billards Networking Night - Young Professionals
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
October 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Series #3
TBA, Calgary, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
October 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Series #3
TBA, Calgary, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
October 31, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
October 31 - November 1, 2006
INTERNATIONAL WOMEN'S INSOLVENCY & RESTRUCTURING CONFEDERATION
IWIRC Annual Conference
San Francisco, California
Contact: http://www.iwirc.com/
November 1, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Halloween Isn't Over! - Ghosts of turnarounds past who
remind you about what you should have done differently
Portland, Oregon
Contact: http://www.turnaround.org/
November 1-4, 2006
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
San Francisco, California
Contact: http://www.ncbj.org/
November 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
Marriott, Bridgewater, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
November 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriott Tyson's Corner, Vienna, Virginia
Contact: 703-912-3309 or http://www.turnaround.org/
November 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
TMA Australia National Conference
Sydney, Australia
Contact: http://www.turnaround.org/
November 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon Program
St. Louis, Missouri
Contact: 815-469-2935 or http://www.turnaround.org/
November 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Joint Reception with NYIC/NYTMA
TBA, New York
Contact: 908-575-7333 or http://www.turnaround.org/
November 15, 2006
LI TMA Formal Event
TMA Australia National Conference
Long Island, New York
Contact: http://www.turnaround.org/
November 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
November 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Bankruptcy Judges Panel
Duquesne Club, Pittsburgh, Pennsylvania
Contact: http://www.turnaround.org/
November 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Dinner Program
TBA, Seattle, Washington
Contact: 503-223-6222 or http://www.turnaround.org/
November 23, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Martini Party
Vancouver, British Columbia
Contact: 403-294-4954 or http://www.turnaround.org/
November 28, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, FL
Contact: 561-882-1331 or http://www.turnaround.org/
November 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Special Program
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
November 30-December 2, 2006
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Hyatt Regency at Gainey Ranch, Scottsdale, Arizona
Contact: 1-703-739-0800; http://www.abiworld.org/
December 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Dinner
Portland, Oregon
Contact: 503-223-6222 or http://www.turnaround.org/
December 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
The Newark Club, Newark, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
December 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
LI TMA Holiday Party
TBA, Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
December 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Christmas Function
GE Commercial Finance, Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
February 2007
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
San Juan, Puerto Rico
Contact: 1-703-739-0800; http://www.abiworld.org/
April 11-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
ABI Annual Spring Meeting
J.W. Marriott, Washington, DC
Contact: 1-703-739-0800; http://www.abiworld.org/
March 27-31, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Spring Conference
Four Seasons Las Colinas, Dallas, Texas
Contact: http://www.turnaround.org/
March 29-31, 2007
ALI-ABA
Chapter 11 Business Reorganizations
Scottsdale, Arizona
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
June 6-9, 2007
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
23rd Annual Bankruptcy & Restructuring Conference
Westin River North, Chicago, Illinois
Contact: http://www.airacira.org/
June 14-17, 2007
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
July 12-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Marriott, Newport, RI
Contact: 1-703-739-0800; http://www.abiworld.org/
October 10-13, 2007
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Orlando, Florida
Contact: http://www.ncbj.org/
October 16-19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
December 6-8, 2007
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Westin Mission Hills Resort, Rancho Mirage, California
Contact: 1-703-739-0800; http://www.abiworld.org/
March 25-29, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Ritz Carlton Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
September 24-27, 2008
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Scottsdale, Arizona
Contact: http://www.ncbj.org/
October 28-31, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
October 5-9, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Desert Ridge, Phoenix, Arizona
Contact: 312-578-6900; http://www.turnaround.org/
2009 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Las Vegas, Nevada
Contact: http://www.ncbj.org/
October 4-8, 2010
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
2010 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
New Orleans, Louisiana
Contact: http://www.ncbj.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via e-mail
to conferences@bankrupt.com are encouraged.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA. Marie Therese V. Profetana, Shimero Jainga, Emi Rose S.R.
Parcon, Rizande B. Delos Santos, Cherry A. Soriano-Baaclo, Terence
Patrick F. Casquejo, Christian Q. Salta, Jason A. Nieva, Lucilo
Junior M. Pinili, Tara Marie A. Martin and Peter A. Chapman,
Editors.
Copyright 2006. 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 $725 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 ***