/raid1/www/Hosts/bankrupt/TCR_Public/070509.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, May 9, 2007, Vol. 11, No. 109
Headlines
750 EAST THUNDERBIRD: Case Summary & 3 Largest Unsec. Creditors
ACURA PHARMA: March 31 Balance Sheet Upside-Down by $12.8 Million
ADAMS DENTAL: Case Summary & 19 Largest Unsecured Creditors
AHOLD LEASE: S&P Lifts Ratings on Class A-1 and A-2 Trusts
AMERICAN TOWER: Earns $22 Million in First Quarter Ended March 31
ANDREW CORPORATION: Posts $2 Mil. Net Loss in Second Quarter 2007
ASC INC: Inks Pact with Hancock Park to Acquire ASC Holdings' Unit
B/E AEROSPACE: Notes Redemption Cues Moody's to Lift Rating to Ba2
BANC OF AMERICA: S&P Holds Low-B Ratings on Five Cert. Classes
BEAZER HOMES: SEC Investigates Federal Securities Law Violation
BROADVIEW NETWORKS: Financial Risk Cues Moody's to Hold B3 Rating
BUCYRUS INTL: Completes DBT GMBH Purchase for $731MM Cash & Stake
CALPINE CORP: California-Affiliate Gets $377 Mil. Credit Facility
CANBRAS COMMS: To Pay $5.4MM as Final Distribution to Shareholders
CASTLE HARBOR: Fitch Holds BB- Rating on $3 Million Class C Notes
CHEMED CORP: Discloses Proposed Offering of $160 Mil. Senior Notes
CLAIRE'S STORES: Moody's Puts Corporate Family Rating at B3
CLEAR CHANNEL: In Talks with Equity Group on Amended Merger Offer
CRUM & FORSTER: Completes $330 Million 7-3/4% Sr. Notes Offering
DILLARDS INC: Amends & Extends $1.2BB Senior Facility Until 2012
DOMINO'S PIZZA: March 25 Balance Sheet Upside-Down by $561 Million
EASTMAN KODAK: Posts $151 Million Net Loss in First Quarter 2007
EASTMAN KODAK: Sells China Assets to Xiamen Land for $40 Million
EASTMAN KODAK: Moody's Affirms B1 Corporate Family Rating
EDISON INT'L: Unit Closes Private Offering of $2.7 Bil. Sr. Notes
ENTERGY NEW ORLEANS: Judge Brown Confirms Fourth Amended Plan
ENTERGY NEW ORLEANS: Fitch Revises Rating on Issuer Default to BB
FORD MOTOR: To Halt Operations of Cleveland Casting Plant in 2009
FOSTER WHEELER: Inks Pact Increasing 5-Year Facility to $100 Mil.
GENCORP INC: Feb. 28 Balance Sheet Upside Down by $64.8 Million
GLOBAL POWER: Selects BDO Seidman as Auditors
GLOBAL POWER: Wants to Issue EUR1.1 Million L/C from DIP Facility
GLOBAL POWER: Court Extends Lease Decision Period Until June 2007
GRANDE COMM: Posts $141.6 Million Net Loss in Year Ended Dec. 31
GREATER BAY: Moody's Puts Ratings Under Review & May Upgrade
HOVNANIAN ENTERPRISES: Posts $54.6 Million Net Loss in First Qtr
HYDROCHEM INDUSTRIAL: Moody's Revises Outlook Stable from Positive
INDALEX HOLDINGS: Posts $22.3 Mil. Net Loss in Year Ended Dec. 31
INTERNATIONAL PAPER: Earns $434 Mil. in First Qtr. Ended March 31
ION MEDIA: Recapitalization Deal Cues S&P's Developing Watch
JIA & SONS: Case Summary & Six Largest Unsecured Creditors
KANSAS CITY MALL: Wyandotte County Gets OK to Pursue Condemnation
KATUN CORP: Weak Performance Cues S&P to Cut Credit Rating to B-
KIK CUSTOM: Moody's Junks Rating on $240 Million Second-Lien Loan
LAKESIDE CARE: Case Summary & 20 Largest Unsecured Creditors
LBI MEDIA: Incurs $1.3 Mil. Net Loss in Fourth Qtr. Ended Dec. 31
LE NATURES: Committees File Joint Amended Ch. 11 Liquidation Plan
MCCLATCHY COMPANY: Earns $9 Million in First Quarter Ended April 1
MCCLATCHY CO: Fitch Downgrades Issuer Default Rating to BB+
MEDIA GENERAL: Moody's Withdraws Ba1 and Ba2 Ratings
MORGAN STANLEY: Moody's Lifts Rating on $20.8 Mil. Class H Certs.
MOUNTAINEER GAS: Fitch Downgrades Issuer Default Rating to BB-
MQ ASSOCIATES: Dec. 31 Balance Sheet Upside-Down by $281 Million
NEW CENTURY: Gets Final OK to Obtain $150,000,000 DIP Financing
NEW CENTURY: Ellington's $58,000,000 Bid to Buy 2,000 Loans Wins
NEW CENTURY: No Bids Received for Loan Origination Biz as of May 2
NEW CENTURY: To Cut 2,000 Jobs Amid Lack of Bids for Key Assets
NORTHROP GRUMMAN: Earns $387 Million in Quarter Ended March 31
NRG ENERGY: Pursues Refinancing to Support Capital Allocation Plan
OHIO CASUALTY: Inks Deal Selling $2.7BB Stake to Liberty Mutual
OHIO CASUALTY: Liberty Mutual Deal Cues Moody's to Review Ratings
PACIFIC LUMBER: Can Employ Xroads Solutions as Financial Advisor
PERSONA COMMUNICATIONS: Bragg Deal Cues S&P's Developing Watch
PETER HANSEN: Case Summary & Largest Unsecured Creditor
PILGRIM'S PRIDE: Incurs $40 Mil. Net Loss in Second Quarter 2007
POPULAR INC: Fitch Lowers Individual Rating to B/C
QUIKSILVER INC: Weak Credit Measures Cue S&P to Cut Rating to BB-
R&G FINANCIAL: Financial Filing Delay Cues Moody's to Cut Ratings
RHODES COMPANIES: High Debt Leverage Cues Moody's to Cut Ratings
RICHARD YOCK: Case Summary & 12 Largest Unsecured Creditors
SAFENET INC: High Debt Leverage Prompts Moody's B2 Rating
SCOTTISH RE: MssMutual Deal Completion Cues A.M Best to Up Ratings
SEA CONTAINERS: Wants Court to Set July 16 as Claims Bar Date
SIGNAL SECURITIZATION: Fitch Holds Rating on 1998-2 Class A Certs.
SONIC CORP: Feb. 27 Balance Sheet Upside-Down by $26 Million
SPECTRX INC: Eisner LLP Raises Going Concern Doubt
STRATOS GLOBAL: Pending CIP Deal Cues Moody's to Hold Ratings
STRUCTURED ASSET: Moody's Rates Class II-B-6 Certificates at Ba2
TALLAHASSEE 99-FL: Case Summary & Two Largest Unsecured Creditors
TENFOLD CORP: Posts Net Loss of $932,000 in Quarter Ended March 31
TRUMP ENTERTAINMENT: Posts $8 Mil. Net Loss in Qtr. Ended March 31
VIASPACE INC: Singer Lewak Expresses Going Concern Doubt
YUKOS OIL: Slovakia Wants Russian Help Over Transpetrol Stake
YUKOS OIL: Shell & BP Set to Join Auction for Petrol Stations
YUKOS OIL: RFFI Sets May 11 Auction for Office & Research Assets
ZOOMERS HOLDING: Bankruptcy Court Dismisses Chapter 11 Case
* Gibson Dunn Adds Eric Feuerstein as Real Estate Partner in NY
* Upcoming Meetings, Conferences and Seminars
*********
750 EAST THUNDERBIRD: Case Summary & 3 Largest Unsec. Creditors
---------------------------------------------------------------
Debtor: 750 East Thunderbird Road Corp.
750 East Thunderbird Road, Suite 4
Phoenix, AZ 85022
Bankruptcy Case No.: 07-02057
Chapter 11 Petition Date: May 7, 2007
Court: District of Arizona (Phoenix)
Judge: George B. Nielsen Jr.
Debtor's Counsel: Allan D. Newdelman, Esq.
80 East Columbus Avenue
Phoenix, AZ 85012
Tel: (602) 264-4550
Fax: (602) 277-0144
Total Assets: $1,400,045
Total Debts: $1,180,633
Debtor's Three Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Lynn Pirie loan $180,000
14835 North 15th Avenue
Phoenix, AZ 85023
Superior Landscape services $5,710
4302 East Lonemountain
Cave Creek, AZ 85331
Richard Sparks D.M.D. parking lot $3,425
770 East Thunderbird Road, repairs
Building C
Phoenix, AZ 85022
ACURA PHARMA: March 31 Balance Sheet Upside-Down by $12.8 Million
-----------------------------------------------------------------
Acura Pharmaceuticals Inc's balance sheet at March 31, 2007,
showed $1.8 million in total assets and $14.6 million in total
liabilities, resulting in a $12.8 million total stockholders'
deficit.
The company's balance sheet at March 31, 2007, also showed
strained liquidity with $680,000 in total current assets available
to pay $14.6 million in total current liabilities.
Acura Pharmaceuticals Inc. reported a net loss of $9.2 million on
for the quarter ended March 31, 2007, compared with a net loss of
$4.2 million for the same period in 2006.
The company had no revenues for the three months ended March 31,
2007, and 2006 and as disclosed by the company, relied upon bridge
loans provided by its current primary shareholders to fund
operations and development activities.
Included in the 2007 and 2006 quarterly results are non cash
compensation expenses of $400,000 and $2.8 million respectively,
pertaining to the company's issued and outstanding stock options
and restricted stock units. Additionally, the 2007 quarterly
results include non-cash expenses of $6.8 million for losses on
common stock warrants and fair value changes in conversion
features, and amortization of debt discount relating to the
company's bridge loans maturing Sept. 30, 2007.
Full-text copies of the company's consolidated financial
statements for the quarter ended March 31, 2007, are available for
free at http://researcharchives.com/t/s?1e96
Going Concern Doubt
BDO Seidman LLP in Chicago, expressed substantial doubt about
Acura Pharmaceuticals Inc.'s ability to continue as a going
concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2006, and 2005. The
auditing firm pointed to the company's recurring losses from
operations and net capital deficiency.
About Acura Pharmaceuticals
Headquartered in Palatine, Illinois, Acura Pharmaceuticals Inc.
(OTCBB: ACUR) -- http://www.acurapharm.com/-- is a specialty
pharmaceutical company engaged in research, development and
manufacture of innovative Aversion(R)(abuse deterrent) Technology
and related product candidates.
ADAMS DENTAL: Case Summary & 19 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Adams Dental Center, Ltd.
832 West Adams
Chicago, IL 60607
Bankruptcy Case No.: 07-08305
Type of Business: The Debtor provides dentistry services.
Chapter 11 Petition Date: May 7, 2007
Court: Northern District of Illinois (Chicago)
Judge: Pamela S. Hollis
Debtor's Counsel: Chester H. Foster, Jr., Esq.
Foster, Kallen & Smith
3825 West 192nd Street
Homewood, IL 60430
Tel: (708) 799-6300
Fax: (708) 799-6339
Estimated Assets: Less than $10,000
Estimated Debts: $1 Million to $100 Million
Debtor's 19 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Broadway Bank loan $1,003,156
5960 North Broadway
Chicago, IL 60660
G.E. Healthcare Financial $417,626
Services
P.O. Box 414418
Boston, MA 02241-4418
George Arvanitis, Sr. $200,000
Chase Equity $197,316
Village Market Place $150,000
Haralmbia Adams $120,000
Gus Maskalaris $100,000
United Investors rent $82,243
Pat Arvanitis $50,000
Dr. Joe LaSpisa $25,000
B.M.W. Financial Services automobile $19,183
N.A., L.L.C.
Financial Pacific Leasing, $18,500
L.L.C.
Advanta Bank $16,532
Progress Dental Lab $9,148
Chase Card Services $7,702
G.E. Money Bank $7,225
Bank of America $7,000
Modern Luxury $6,800
Patterson Dental Supply $6,498
AHOLD LEASE: S&P Lifts Ratings on Class A-1 and A-2 Trusts
----------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on classes
A-1 and A-2 from Ahold Lease 2001-A Pass Through Trusts to 'BBB-'
from 'BB+'. Concurrently, the outlook on these ratings was
revised to stable from positive.
The upgrades reflect the May 4, 2007, raising of the corporate
credit rating on Koninklijke Ahold N.V. (Ahold; BBB-/Stable/A-3).
The Ahold upgrade followed the recently announced disposal of the
company's U.S. Foodservice division.
The ratings on Ahold Lease 2001-A Pass Through Trusts are
dependent on the rating on Ahold, which guarantees the leases that
serve as the source of payment for the rated securities. U.S.
Foodservice is associated with five leases, and Standard & Poor's
has confirmed with Ahold that the related lease guarantees are
still in place.
AMERICAN TOWER: Earns $22 Million in First Quarter Ended March 31
-----------------------------------------------------------------
American Tower Corporation recorded $22.2 million in net income
for the first quarter ended March 31, 2007, as compared with a
$1.9 million net loss for the quarter ended March 31, 2006. Total
revenues for the quarter ended March 31, 2007, increased to
$352.5 million from $320.4 million for the same quarter a year
earlier. Its rental and management segment revenues increased to
$346 million from $316.3 million for the same quarter a year
earlier.
Jim Taiclet, American Tower's chief executive officer, stated,
"Wireless communications continue to increase in importance for
consumers and business users alike. As a result, our major
customers in both the U.S. and Latin America are enjoying
sustained growth in revenue and profitability. Moreover, wireless
service providers are focusing on improving the quality of their
services and launching new services.
"These two factors, the profitable growth of the wireless industry
and its focus on high quality existing and new services, drive
strong demand for tower space that we believe is sustainable over
time. Our first quarter financial results reflect both this
overarching industry growth trend and American Tower's ability to
consistently deliver the highest operating margins in the tower
sector.
"We are also taking advantage of the size and quality of our tower
portfolio to advance our financial strategy. Our recently
completed $1.75 billion securitization of a portion of our tower
assets increased our financial flexibility while reducing our cost
of financing. With the securitized financing in place, we are in
a solid position to move forward on additional improvements to our
balance sheet while supporting our ongoing share repurchase
program and maintaining our readiness to pursue strategic
opportunities."
Free Cash Flow increased to $139.9 million, consisting of
$171.4 million of cash provided by operating activities, less
$31.4 million of payments for purchases of property and equipment
and construction activities, including $16.6 million of
discretionary capital spending. The company completed the
construction of 22 towers and the installation of 4 in-building
systems during the quarter and spent about $9.9 million on ground
lease purchases.
The company's balance sheet as of March 31, 2007, reflected total
assets of $8.3 billion, total liabilities of $4.3 billion, and
minority interest of $3.5 million, resulting in a total
stockholders' equity of $4 billion.
The company's March 31 balance sheet also reflected strained
liquidity with total current assets of $259.6 million available to
pay total current liabilities of $306.3 million. It recorded an
accumulated deficit of $2.7 billion as of March 31, 2007.
Stock Repurchase Program
During the quarter ended March 31, 2007, the company completed its
$750 million stock repurchase program and commenced repurchases
pursuant to its $1.5 billion stock repurchase program. As of May
2, 2007, the company had repurchased pursuant to its publicly
announced stock repurchase programs an aggregate of 29.3 million
shares of its Class A common stock for about $1 billion since
November 2005. The company expects to complete the remaining
$1,211 million of stock repurchases pursuant to its current $1.5
billion stock repurchase program by February of 2008.
Financing Highlights
On May 4, 2007, the company completed the issuance, in a private
transaction, of $1.75 billion of Commercial Mortgage Pass-Through
Certificates due April 2037 with an interest rate of 5.61%. The
Certificates are backed by debt of two special-purpose
subsidiaries of the company, which are secured primarily by
mortgages on its interests in 5,295 wireless and broadcast
communication towers and the related tower sites.
Net proceeds from the offering of the Certificates were used to
repay about $765 million outstanding under the company's
SpectraSite credit facility, as well as $250 million under its
American Tower revolving credit facility. The company expects to
use the remaining net proceeds to fund the repurchase of about
$325 million of its 7.25% senior subordinated notes due 2011 of
American Towers Inc., to pay other consideration payable, and for
general corporate purposes. The company had about $1 billion of
available liquidity as of May 7, 2007.
About American Tower
Headquartered in Boston, Massachusetts, American Tower Corporation
(NYSE: AMT) -- http://www.americantower.com/-- is an independent
owner, operator and developer of broadcast and wireless
communications sites in the U.S., Mexico and Brazil. American
Tower owns and operates over 22,000 sites and manages about 2,000
revenue producing rooftop and tower sites.
* * *
As reported in the Troubled Company Reporter on Feb. 16, 2007,
Moody's Investors Service upgraded the corporate family rating of
American Tower Corporation to Ba1 from Ba2, and affirmed the
company's SGL-1 liquidity rating. The outlook is stable.
ANDREW CORPORATION: Posts $2 Mil. Net Loss in Second Quarter 2007
-----------------------------------------------------------------
Andrew Corporation reported preliminary results for the second
quarter of fiscal 2007 with total sales of $502.7 million and
a net loss of $2 million. The company had total sales of
$481.7 million and a net income of $3.7 million for the second
quarter ended March 31, 2006. Higher income taxes contributed to
the loss in the quarter, which compared to net income for the
prior year second quarter of $3.6 million.
"As we previously guided, the first half of our fiscal year has
been challenging due to consolidation issues with two significant
North American customers, volatile commodity costs and a number of
important facility start-ups and relocations," said Ralph Faison,
president and chief executive officer, Andrew Corporation. "While
our revenue growth for the quarter was modest in our seasonally
weakest quarter, we are pleased that we have been able to replace
reduced revenues of over $130 million to those two customers in
the first half of our fiscal year 2 with significant increases in
volume with other customers and in other geographies. We also
have been able to recover a significant portion of our higher
commodity costs incurred during the quarter.
"In addition, we have executed well on two significant facility
relocations this year. Our new world-class cable facility in
Joliet is in production, on budget and ahead of our expectations
and our new factory in India is also in production and ramping up
well, helping to serve the unprecedented demand we are
experiencing in India. As we look ahead, we believe that Andrew
is well positioned to continue to be the supplier of choice on a
global basis to serve the needs of wireless operators and
infrastructure original equipment manufacturers. While we believe
that our North American business is starting to improve and should
help drive a stronger second half, we remain cautious about our
prospects in that geography if we do not see meaningful sequential
improvement from the two customers where we have had significant
weakness for the last two quarters. Finally, we continue to
deliver on our goal of improving gross margins consistent with our
previous guidance. We expect higher levels of business in the
June and September quarters and anticipate improved operating
leverage on that seasonal uptick.
The company made significant progress in exiting its Orland Park
facility and transitioning to its new Joliet, Illinois cable
facility during the quarter. About $8 million of relocation and
start-up costs, including unabsorbed overhead for lost production
and duplicate facilities, were incurred during the quarter, which
reduced gross margin by about 160 basis points.
Satellite Communications Business
The company has retained an investment bank, CIBC World Markets
Corp., to help explore strategic alternatives for its Satellite
Communications business and intends to sell the business.
Mr. Faison said, "In exploring strategic alternatives, we have
received several indications of interest for Satellite
Communications. As a result, we have decided to pursue a sale of
the business. Similar to the recent sale of our broadband cable
assets, which we completed subsequent to the end of the second
quarter, this decision allows management to focus all of its time,
attention and resources on our core wireless infrastructure
products and solutions."
The final terms of any divestiture transaction are subject to
board approval, and there can be no assurance as to the terms,
timing or consummation of any such transaction.
Balance Sheet and Cash Flow Highlights
Cash flow from operations was $21.8 million in the second quarter,
compared to $13.4 million in the prior year second quarter. Cash
and cash equivalents were $127 million at March 31, 2007, compared
to $100 million at December 31, 2006. Total debt outstanding was
$366 million at March 31, 2007, as compared with $386 million at
Dec. 31, 2006. During the quarter, the company amended the
operating lease agreement for its new Joliet, Illinois facility,
which served to reduce the amount of debt previously recorded on
the balance sheet by about $30 million.
As of March 31, 2007, the company posted $2.3 billion in total
assets and total liabilities of $842.5 million, resulting in a
total stockholders' equity of $1.5 billion.
Fiscal 2007 Outlook
Sales are anticipated to range from $2.2 billion to $2.3 billion,
excluding any significant rationalization of product lines or
significant acquisitions. The company currently anticipates the
effective tax rate for the year will be in the range of 44% to
46%, based on the anticipated full year results.
About Andrew Corporation
Headquartered in Westchester, Illinois, Andrew Corporation
(NASDAQ: ANDW) -- http://www.andrew.com/-- designs, manufactures
and delivers equipment and solutions for the global communications
infrastructure market. The company serves operators and original
equipment manufacturers from facilities in 35 countries. Andrew
Corporation is an S&P MidCap 400 company founded in 1937.
* * *
As reported in the Troubled Company Reporter on March 13, 2007,
Standard & Poor's Ratings Services affirmed its 'BB' corporate
credit and other ratings on Westchester, Illinois-based Andrew
Corp. and removed the ratings from CreditWatch, where they
originally were placed with positive implications on May 31, 2006.
The outlook is stable.
ASC INC: Inks Pact with Hancock Park to Acquire ASC Holdings' Unit
------------------------------------------------------------------
ASC Incorporated has signed a definitive purchase agreement with
Hancock Park Associates for the automotive "open air" roof-systems
unit and the automotive design-services unit of ASC from its
owner, American Specialty Cars Holdings LLC. Terms of the
transaction were not disclosed.
As a condition of the asset-purchase agreement, the sale of the
two ASC units is to be conducted under the provisions of Chapter
11, Section 363, of the U.S. Bankruptcy Code. Accordingly, ASC
has filed a voluntary petition for reorganization under Chapter 11
with the U.S. Bankruptcy Court for the Eastern District of
Michigan.
American Specialty Cars Holdings believes that a sale in this
fashion will ensure an orderly, strategic sale of ASC's viable
open-air and design units and the liquidation and dissolution of
ASC's other, non-productive assets.
As part of the filing, ASC has arranged for debtor-in-possession
financing from Comerica Bank, which will be used by ASC to fund
normal business operations. The company said the steps it is
taking would help ensure continuity of supply to its customers,
and that it has planned appropriately for these actions and is
operating as normal.
About Hancock Park Associates
Headquartered in Los Angeles, California, Hancock Park Associates
-- http://www.hpcap.com/-- is a private equity investment firm
founded in 1986 which focuses on small to mid-size businesses in
the retail and manufacturing industries and is the principal
shareholder in Irvine, California-based Saleen Inc.
About ASC Incorporated
Headquartered in Southgate, Michigan, ASC Incorporated --
http://www.ascglobal.com/-- is a supplier of highly engineered
roof systems and of design services for the world's automakers.
The company was founded in 1965. The company filed for Chapter 11
protection on May 2, 2007, (Bankr. Case No.: 07-48680 E.D. Mich.)
Gary H. Cunningham, Esq. and Sean M. Walsh, Esq. of Giarmarco,
Mullins & Horton P.C. represent the Debtor in its restructuring
efforts. No Official Committee of Unsecured Creditors has been
appointed in this case. When the Debtor filed for protection from
its creditors, it listed assets and debts from $1 million to
$100 million.
B/E AEROSPACE: Notes Redemption Cues Moody's to Lift Rating to Ba2
------------------------------------------------------------------
Moody's Investors Service has raised the ratings of B/E Aerospace,
Inc., Corporate Family Rating to Ba2 from B1. The ratings on
B/E's senior secured credit facility have been upgraded to Ba1
from Ba3, while the senior unsecured notes' rating was upgraded to
B1 from B2. In addition, the Speculative Grade Liquidity Rating
was raised to SGL-1 from SGL-2. The ratings outlook is stable.
This concludes the review for upgrade commenced on March 19, 2007.
The ratings upgrade was prompted by B/E's May 1, 2007 redemption
of $250 million of senior subordinated notes as well as the
repayment of approximately $100 million of its senior secured term
loan facility through use of proceeds from the company's March
2007 equity offering. Through this re-capitalization, the
company's total debt will be reduced by about 60%.
B/E's Corporate Family Rating reflects the company's modest debt
levels and light leverage that are consequential to substantial
debt repayment amidst a period of strong revenue growth and margin
improvement. Moody's estimates pro forma (March 2007) leverage
(Debt/EBITDA) of about 1.2 times as a result of the de-levering.
Similarly, pro forma EBIT/Interest is estimated at about 11 times.
Leverage and interest coverage metrics are quite strong for the
Ba2 rating level, and are expected to remain so for the near
future. Continued sales growth and margin maintenance over the
next few years is likely in the favorable and still-improving
demand environment in the commercial aircraft sector, both for
suppliers to OEM's as well as in the aftermarket. Ratings remain
constrained, however, by expected limited free cash flow
generation and expectations that current low debt levels will not
be sustained. Moody's estimates that FY 2007 free cash flow will
be less than 50% of EBITDA, affected largely by substantial use of
cash in the first quarter of 2007 for working capital
requirements, primarily in finished goods inventory in its
fasteners distribution segment. Growth, 34% in 2006, is expected
to continue at strong levels. Moody's is concerned that the
capital to fund such growth may come from increases in debt rather
than through equity issuance as experienced over the past three
years.
The ratings continue to consider B/E's concentration risk in what
has historically been a highly cyclical industry. Although over
80% of the company's revenues is derived from three distinct
product segments (seating, cabin interiors, and fasteners
distribution), all three businesses are essentially driven by the
same demand factors in the commercial aviation sector. It should
also be noted that, as recently as FY 2005, while the sector
recovery was well underway, B/E's margins and retained cash flow
levels were much weaker than they are today. As such, upside
potential for B/E's ratings, like those for most suppliers to the
commercial aircraft sector, will continue to be limited by the
potential for substantially weakened credit fundamentals in an
industry downturn.
Also, Moody's is concerned that B/E's credit profile is subject to
a degree of event risk. The company's rapid growth has come from
a combination of organic growth mentioned above and a moderate
pace of acquisitions, using a relatively small amount of debt,
since repaid, for funding. While current debt at historically low
levels has a strong positive influence on the ratings, Moody's
tempers the dramatic drop in leverage with concerns over possible
use of cash and addition debt to fund large increments in growth
(for example, undertaking a large acquisition or the purchase of a
substantial amount of parts inventory in the distribution
segment). The Ba2 CFR should be able to withstand all but a
highly transformational levered acquisition, assuming market
conditions do not deteriorate substantially over the near term.
B/E's SGL-1 speculative grade liquidity rating reflects the
company's very good liquidity (cash and committed credit
availability), with a comfortable cushion to covenant levels as
provided in its sizeable revolving credit facility. The SGL
rating also reflects improving cash flow generation through FY
2007. In addition, liquidity benefits from the repayment of
$250 million in high-coupon subordinated notes in May 2007, which
reduces interest expense by about $22 million annually compared to
FY 2006. Furthermore, B/E Aerospace does not have any significant
near-term maturities of long term debt that would place a call on
cash.
The stable rating outlook reflects Moody's expectations that B/E's
operating performance will remain strong over the next 12-18
months while the company generates better levels of free cash flow
over this period, despite expectations for further heavy
investments in working capital to support continued growth.
Moody's further expects that, over the intermediate to long term,
working capital usage will moderate somewhat as demand growth
decelerates and places less of a burden on the ramp-up
requirements in inventory that come with the addition of new
products and customers.
The ratings or their outlook could be revised upward if the
company's working capital use were to moderate over the near term
to less than 75% of operating cash flow, resulting in free cash
flow of at least 5% of total debt. However, since leverage and
coverage metrics are currently quite strong for a Ba-rated
company, further ratings upgrades would require a substantial
increase in the company's revenue base and diversification without
a material increase in debt levels or risk profile. The ratings
could be subject to downward revision if operating conditions were
to deteriorate substantially, or if the company were to take on a
very high amount of additional debt, possibly for a large
transformational type of acquisition, such that leverage were to
exceed 4.0 times, or if retained cash flow were to fall below 15%
of total debt.
These ratings have been upgraded:
* Senior secured credit facility, to Ba1 (LGD3, 37%) from Ba3
* Senior unsecured notes, to B1 (LGD5, 86%) from B2
* Corporate Family Rating to Ba2 from B1
* Probability of Default Rating to Ba2 from B1
* Speculative Grade Liquidity Rating to SGL-1 from SGL-2
This rating has been withdrawn:
* Senior subordinated notes due 2011, previously rated B3
B/E Aerospace, Inc., headquartered in Wellington, Florida, is the
world's largest manufacturer of commercial and general aviation
cabin interior products and a major independent distributor of
aerospace fasteners.
BANC OF AMERICA: S&P Holds Low-B Ratings on Five Cert. Classes
--------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on eight
classes of commercial mortgage pass-through certificates from Banc
of America Commercial Mortgage Inc.'s series 2003-1.
Concurrently, ratings are affirmed on the remaining 26 classes
from the same series.
The raised ratings on the raked certificates reflect the stable
operating performance of the Emerald Square Mall and the
amortization of the loan. The affirmed ratings on the pooled
certificates reflect credit enhancement levels that provide
adequate support through various stress scenarios. The affirmed
ratings on the raked certificates reflect the fact that 100% of
the cash flow for these classes comes from U.S. Treasuries and
agency bonds.
As of the April 11, 2007, remittance report, the collateral pool
consisted of 111 loans with an aggregate trust balance of
$1.071 billion, compared with 112 loans totaling $1.132 billion at
issuance. The master servicer, Bank of America N.A., reported
primarily full-year 2006 financial information for 98% of the
pool, which excludes $367.5 million (34%) of loans secured by
defeased collateral. Based on this information, Standard & Poor's
calculated a weighted average debt service coverage of 1.56x, down
from 1.68x at issuance. There is only one delinquent loan in the
pool, which is 90-plus-days delinquent (cumulative exposure of
$1.7 million) and is with the special servicer, Midland Loan
Services Inc. To date, the trust has not experienced any losses.
The top 10 loans secured by real estate have an aggregate
outstanding balance of $322.7 million (34%) and a weighted average
DSC of 1.67x, up from 1.61x at issuance. Standard & Poor's
reviewed property inspections provided by the master servicer for
all of the assets underlying the top 10 loans. One property was
characterized as "excellent," while the remaining collateral was
characterized as "good."
Credit characteristics for two of the loans in the pool are
consistent with those of high investment-grade obligations.
Details of these two loans are:
-- The largest exposure in the pool, the Emerald Square Mall,
is encumbered by a $97.8 million class A note and a
$38.5 million class B note. The B note provides 100% of
the cash flow to the raked certificates (noted with an
"ES" prefix in the rating list below). The loan is secured
by a fee interest in 563,715-sq.-ft. of a 1.0 million-sq.-
ft. regional mall in North Attleboro, Massachusetts. The
sponsor of the loan and manager of the property is Simon
Property Group Inc. (A-/Stable/--). Standard & Poor's
adjusted NCF for this loan is stable since issuance.
-- The fourth-largest exposure in the pool, the Rogue Valley
Mall, is encumbered by a $27.1 million whole loan and is
secured by a fee interest in 445,764-sq.-ft. of a 1.0
million-sq.-ft. regional mall in Medford, Ore. The
sponsor of the loan and manager of the property is General
Growth Properties Inc. (BBB-/Stable/--). Standard &
Poor's adjusted NCF for this loan has improved
significantly from its level at issuance.
Bank of America reported a watchlist of 20 loans ($98.0 million,
9%). Sugar Run Apartments, the 10th-largest loan in the pool
secured by real estate, is the largest loan on the watchlist with
an outstanding balance of $19.0 million (2%) and is secured by a
394-unit multifamily property in New Albany, Ohio. The loan
appears on the watchlist because the collateral property reported
a year-end 2006 DSC of 1.48x, down from 2.02x at issuance.
Standard & Poor's stressed the loans on the watchlist and the
other loans with credit issues as part of its analysis. The
resultant credit enhancement levels support the raised and
affirmed ratings.
Ratings Raised (Raked Certificates)
Banc of America Commercial Mortgage Inc.
Commercial mortgage pass-through certificates
series 2003-1
Rating
------
To From Credit enhancement
-- ---- ------------------
ES-A AAA AA N/A
ES-B AA+ AA- N/A
ES-C AA A+ N/A
ES-D AA- A N/A
ES-E A+ A- N/A
ES-F A BBB+ N/A
ES-G A- BBB N/A
ES-H BBB+ BBB- N/A
Ratings Affirmed (Pooled Certificates)
Banc of America Commercial Mortgage Inc.
Commercial mortgage pass-through certificates
series 2003-1
Class Rating Credit enhancement
----- ------ ----------------
A-1 AAA 19.17%
A-2 AAA 19.17%
B AAA 15.60%
C AAA 14.28%
D AA+ 11.77%
E AA 10.58%
F A+ 9.39%
G A 8.20%
H BBB+ 7.14%
J BBB- 4.89%
K BB+ 4.10%
L BB 3.44%
M B+ 2.78%
N B 2.25%
O B- 1.85%
XC AAA N/A
XP-2 AAA N/A
Ratings Affirmed (Raked Certificates)
Banc of America Commercial Mortgage Inc.
Commercial mortgage pass-through certificates
series 2003-1
Class Rating Credit enhancement
----- ------ ----------------
SB-A AAA N/A
SB-B AAA N/A
SB-C AAA N/A
SB-D AAA N/A
SB-E AAA N/A
WB-A AAA N/A
WB-B AAA N/A
WB-C AAA N/A
WB-D AAA N/A
*N/A - Not applicable.
BEAZER HOMES: SEC Investigates Federal Securities Law Violation
---------------------------------------------------------------
Beazer Homes USA Inc. disclosed in a regulatory filing that
the U.S. Securities and Exchange Commission has conducted an
informal inquiry to determine whether any person or entity related
to the company has violated federal securities laws.
Beazer Homes intends to cooperate fully with the SEC's inquiry,
the company's president and chief executive officer Ian J.
McCarthy said.
The company, Mr. McCarthy said, also received notice that a
putative class action complaint was filed on April 30, 2007, on
behalf of a purported class consisting of present and former
participants and beneficiaries of the Beazer Homes 401(K) Plan
naming Beazer Homes, certain of its current and former officers
and directors and the Benefits Administration Committee as
defendants.
The complaint, filed on April 30, 2007 with the United States
District Court for the Northern District of Georgia, Atlanta
Division, alleges that the company breached fiduciary duties,
including those stated in the Employee Retirement Income Security
Act as a result of the investment of retirement monies held by the
401(K) Plan in common stock of Beazer Homes at a time when
participants were allegedly not provided timely, accurate and
complete information concerning Beazer Homes.
At present, the company says it has found no evidence to support
the allegations and intends to vigorously defend the action. The
company adds that it does not intend to file further Current
Reports on Form 8-K describing additional similar actions, if any,
which are based on substantially similar allegations.
About Beazer Homes
Headquartered in Atlanta, Beazer Homes USA Inc., (NYSE: BZH) --
http://www.beazer.com/-- is one of the country's ten largest
single-family homebuilders with operations in Arizona, California,
Colorado, Delaware, Florida, Georgia, Indiana, Kentucky, Maryland,
Mississippi, Nevada, New Jersey, New Mexico, New York, North
Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas,
Virginia and West Virginia and also provides mortgage origination
and title services to its homebuyers.
* * *
As reported in the Troubled Company Reporter on April 11, 2007,
Fitch Ratings affirmed Beazer Homes USA Inc.'s ratings as: (i)
Issuer Default Rating 'BB+'; (ii) $1.56 billion senior unsecured
debt 'BB+'; (iii) $1 billion unsecured bank credit facility 'BB+'.
The Rating outlook has been revised to Negative from Stable.
BROADVIEW NETWORKS: Financial Risk Cues Moody's to Hold B3 Rating
-----------------------------------------------------------------
Moody's Investors Service has affirmed the B3 corporate family
rating, and the upsized $300 million second lien secured notes at
Broadview Networks Holdings, Inc.
The $90 million increase in the notes, along with $30 million in
additional preferred equity will be used to fund the acquisition
of InfoHighway Communications and for general corporate purposes.
In addition, the company has a $25 million revolving credit
facility, which Moody's has not rated. The outlook remains
stable.
According to Gerald Granovsky, Moody's analyst, "The B3 corporate
family rating reflects Broadview's financial risk, historic lack
of free cash flow generation, challenging competitive position as
a CLEC, and the complexity of integrating the InfoHighway
acquisition, while simultaneously integrating ATX, which was
acquired in September 2006." The ratings benefit from the
company's emerging operating scale in the northeast US, and the
expected EBITDA growth driven by merger synergies.
The company's leverage (which includes 50% of preferred stock
accounted as debt, in accordance with Moody's methodology, and
adjusted for operating leases) is expected to be about 5.8x 2006
EBITDA (before syergies) at closing, and is high relative to the
CLECs that Moody's rates. In addition, Moody's expects the
company to commence generating very modest free cash flow in 2007.
Granovsky added, "The stable rating outlook considers the
company's growth plans and the reasonable likelihood of achieving
merger synergies leading to free cash flow growth and deleveraging
over the rating horizon." Although Broadview's credit metrics
exhibit an improving ratings profile, given the company's
acquisitive history and the ongoing consolidation trend in the
CLEC industry, Moody's believes the likelihood of continued
acquisitions, which could delay anticipated deleveraging,
constrains the ratings.
Moody's has taken these ratings actions:
Issuer -- Broadview Networks Holdings, Inc.
* Corporate Family Rating -- Affirmed B3
* Probability of Default Rating -- Affirmed B3
* 2nd Lien Secured Notes -- Affirmed B3, LGD4-54%
Outlook is Stable
Broadview Networks, headquartered in Rye Brook, New York, is a
CLEC serving over 800,000 access line equivalents, pro forma the
acquisition of InfoHighway, of New York, NY. InfoHighway is a New
York City based CLEC, which was created from the merger of Eureka
Networks and InfoHighway. Pro forma for the InfoHighway
acquisition, Broadview generated $509 million in annual revenue in
2006.
BUCYRUS INTL: Completes DBT GMBH Purchase for $731MM Cash & Stake
-----------------------------------------------------------------
Bucyrus International Inc. has completed its acquisition
of DBT GmbH, through its acquisition subsidiary, DBT Holdings
GmbH, for $710 million in cash, subject to certain closing
adjustments, and 471,476 shares of Bucyrus' common stock with a
market value of $21 million.
"The DBT acquisition represents an important event in the
development of the company," Timothy W. Sullivan, president and
chief executive officer of Bucyrus, said. "The company believes
its entry into the underground mining equipment industry will
enhance the company's ability to sell original equipment and
aftermarket support to a larger segment of the global mining
equipment market, and the company is pleased to add DBT's
internationally recognized brand and leading market position to
the company's product portfolio."
On Dec. 18, 2006, Bucyrus has signed a definitive agreement to
acquire DBT GmbH for $710 million in cash and issue to RAG 471,476
shares with a market value of $21 million.
The company believed that the Bucyrus/DBT combination would
provide significant geographic, product and end market
diversification for Bucyrus. The company also added that, DBT
would enhance Bucyrus' market in China well as in the markets of
other developing countries such as Russia and India.
Bucyrus acquired DBT in a two-stage transaction. Bucyrus and the
Hamburg Trust, a private German investor, have formed a holding
company, in the acquisition of DBT. Bucyrus funded the purchase
price and is entitled to 100% of the dividends and cash flow of
DBT.
The parties have also entered into an irrevocable purchase
agreement pursuant to which Bucyrus would acquire all of the
holding company shares held by the Hamburg Trust by no later than
2009 for EUR8MM. Bucyrus and the Hamburg Trust honored the prior
commitments made by DBT with its German workers regarding facility
and employee matters. In addition, Bucy shareholder consent is
not required for the acquisition.
Bucyrus has received a financing commitment from Lehman Brothers
to support the transaction's cash purchase price, well as a
permanent financing structure that included a combination of debt
and equity securities consistent with achieving a conservative
capital structure. Lehman Brothers acted as the sole financial
advisor to Bucyrus in the transaction.
About DBT GmbH
Headquartered in Lunen, Germany, DBT GmbH -- http://www.dbt.de/--
is a designer, manufacturer and marketer of high technology system
solutions for underground coal mining. DBT manufactures equipment
including roof support systems, armored face conveyers, plows,
shearers and continuous miners used primarily by customers who
mine coal. DBT has eight facilities around the world with
approximately 3,200 employees. DBT generates approximately $1
billion in annual revenue.
About Bucyrus International
Headquartered in South Milwaukee, Wisconsin, Bucyrus International
Inc. (Nasdaq: BUCY) -- http://www.bucyrus.com/-- is a global
manufacturer of electric mining shovels, walking draglines and
rotary blasthole drills and provides aftermarket replacement parts
and services for these machines. In 2006, it had sales of $738
million.
* * *
As reported in the Troubled Company Reporter on April 25, 2007,
Moody's Investors Service confirmed the corporate family rating of
Bucyrus International, Inc. at Ba3. Moody's also assigned Ba3
ratings to Bucyrus': (i) $400 million revolving credit facility;
(ii) EUR50 million revolving credit facility; and
(iii) $825 million secured term loan. Bucyrus' rating outlook is
stable. The action concludes the ratings review initiated on
Dec. 18, 2006.
CALPINE CORP: California-Affiliate Gets $377 Mil. Credit Facility
-----------------------------------------------------------------
Calpine Corporation's subsidiary, Otay Mesa Energy Center LLC, has
obtained a $377 million credit facility to finance the
construction of its 596-megawatt Otay Mesa Energy Center near
San Diego, California.
The project finance facility for the indirect, stand-alone
subsidiary is comprised of a construction loan that will
convert to a term loan at commercial operations, expected in
May 2009. The term loan will mature in April 2019. The loan
facilities, jointly arranged by ING Capital LLC and BayernLB, are
non-recourse to Calpine, and therefore neither Calpine nor any of
its affiliates is responsible for the debt or any obligations of
OMEC.
Concurrent with this financing, OMEC has executed a ten-year
tolling agreement with San Diego Gas & Electric for the full
output of the Otay Mesa Energy Center. Under the terms of the
agreement, SDG&E will have the ability to dispatch power from the
Otay Mesa plant to serve its energy customers, and the utility
will supply natural gas to fuel the power plant. The agreement
also provides SDG&E the option to purchase the plant at the end of
the contract term in 2019. If SDG&E does not exercise its
option, under certain circumstances, OMEC has the right to require
SDG&E to purchase the plant.
"As one of California's largest, environmentally responsible power
producers, Calpine is dedicated to developing clean, reliable and
cost-effective energy solutions for its customers," Robert P. May,
Calpine chief executive officer, stated. "This financing will
allow Calpine to complete construction for SDG&E of a needed, low-
carbon energy resource - demonstrating that Calpine's customers,
California and the environment can benefit from the continued
development of new power generation facilities like the Otay Mesa
Energy Center. The company appreciates SDG&E's commitment to the
development of clean, reliable power generation. Calpine also is
pleased with the continued support of two of its key relationship
banks and looks forward to working with them on future
transactions."
Calpine Construction Management Company Inc. will be responsible
for overseeing all aspects of construction for the plant,
including management of the project's general contractor, a joint
venture between ARB Inc. and Barton Malow Company, named Otay Mesa
Power Partners. Calpine plans to re-commence construction of the
plant this month, and will complete start-up, testing and
commissioning by May 2009.
The company will operate and maintain the plant through its
subsidiary, Calpine Operating Services Company, Inc. Comparable to
the majority of Calpine's energy centers, the Otay Mesa Energy
Center will use a combined-cycle design that will enable it to
generate electricity up to 40 percent more efficiently than
traditional natural gas-fueled facilities. The project also will
incorporate best available emissions control technology
significantly reducing emissions.
About Calpine in California
Calpine has made an investment in California's energy
infrastructure through the construction and operation of fuel-
efficient fleet of power plants. Since July 2001, Calpine has
added more than 4,000 megawatts of clean, fuel-efficient capacity
in California. The company's fleet of natural gas-fueled,
combined-cycle power plants is among the cleanest and most fuel-
efficient of its kind, and unlike traditional renewable resources
such as wind and solar, Calpine's renewable geothermal power
plants are capable of generating electricity twenty four hours a
day, seven days a week. Calpine currently operates 41 power
plants in the state, which combined are capable of generating more
than 5,250 megawatts of electricity. This is equivalent to almost
10% of peak California power demand and is enough electricity to
power more than five million Californian households.
About Calpine Corporation
Headquartered in San Jose, California, Calpine Corporation
(OTC Pink Sheets: CPNLQ) -- 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. 47; Bankruptcy
Creditors' Service Inc. http://bankrupt.com/newsstand/or
215/945-7000).
Calpine Corp. has until June 20, 2007, to file a plan, and until
Aug. 20, 2007, to solicit acceptances of that plan.
CANBRAS COMMS: To Pay $5.4MM as Final Distribution to Shareholders
------------------------------------------------------------------
Canbras Communications Corp. has declared a final shareholder
distribution in the amount of $0.0993 per common share --
$5,471,238 in the aggregate -- to common shareholders of record as
of May 11, 2007, which will be payable as of May 28, 2007.
The final distribution represents a distribution to shareholders
of the proceeds received by Canbras upon the sale of all of its
operations, which sale transaction was concluded on Dec. 24, 2003.
The final distribution will be in the form of a return of capital
and will bring total shareholder distributions from the sale
transaction to $0.489 per share (approximately $27 million in the
aggregate).
Immediately following the final distribution, Canbras intends to
delist its shares from the NEX Exchange and to dissolve the
company which will result in the company's website being no longer
operative. After these steps are taken, shareholders will no
longer have a means to trade their shares or to obtain information
about the company from its Web site.
Canada Federal Income Tax Considerations
A. Residents of Canada
The final distribution to shareholders of Canbras who, for
purposes of the Income Tax Act, are residents of Canada,
represents a reduction in the paid-up capital of the Canbras
common shares. No dividend or benefit will be deemed to have been
paid to such resident shareholder as a result of the final
distribution as the amount of the final distribution does not
exceed the paid-up capital of the common shares for tax purposes.
However, resident shareholders receiving the final distribution
will be required to reduce the adjusted cost base of their common
shares by an amount equal to the final distribution. To the extent
that the final distribution on the common shares exceeds the
adjusted cost base of such shares the resident shareholder will
realize a capital gain at that time.
A resident shareholder will also generally be considered to have
disposed of his or her common shares at the time such common
shares are cancelled. It should be noted that the Canada Revenue
Agency considers that there may be a disposition of the shares of
a corporation even though the formal dissolution of the
corporation has not been completed and the shares have not been
cancelled when there is substantial evidence that the corporation
will be dissolved within a short period of time. It is
anticipated that Canbras will cancel the common shares and
formally dissolve shortly after the final distribution.
Upon the disposition of his or her common shares, a resident
shareholder will generally sustain a capital loss equal to the
adjusted cost base of his or her shares at the time of such
disposition. Such adjusted cost base must be adjusted to reflect
the final distribution received by such resident shareholder and
any other previous distributions made by Canbras to such resident
shareholder by way of a reduction in the paid-up capital of the
common shares.
B. Non-Residents of Canada
Subject to the following comments, the summary of Canadian federal
income tax consequences applicable to resident shareholders would
generally apply to holders of the common shares who, for the
purposes of the ITA and any applicable tax treaty, and at all
relevant times, are not residents of Canada. This includes the
comments above with respect to a disposition as a result of the
final distribution or cancellation of their common shares.
The common shares are listed on the NEX board of the TSX Venture
Exchange. The NEX is not currently considered a prescribed stock
exchange for purposes of the ITA and, consequently, the common
shares held by a Non-resident shareholder constitute "taxable
Canadian property" to such a shareholder. As a result, any
capital gain resulting from the final distribution or a
disposition of the common shares will be subject to Canadian tax
to a non-resident shareholder unless the resulting capital gain is
exempt from Canadian tax under a bilateral tax convention entered
into by Canada and another country. However, it should be noted
that the CRA has advised Canbras that the requirements of section
116 of the ITA will not apply to the final distribution.
About Canbras Communications
Canbras Communications Corp. (NEX:CBC.H) -- http://www.canbras.ca/
-- through its subsidiaries, was previously engaged in the
acquisition, development and operation of broadband communications
services in Brazil, including cable television, Internet access
and data services.
On Oct. 8, 2003, the company announced that it had entered into
definitive agreements for the sale of all of its operations to
Horizon Cablevision do Brasil S.A. Subsequently, on Dec. 24,
2003, Canbras announced that following the receipt of the
requisite approval of its shareholders, the company had completed
the sale of all of its operations to Horizon. Canbras ceased all
business activities other than those related to the completion of
the Horizon Sale and the winding up process. The company intends
to apply for a Certificate of Dissolution, after the conclusion of
the winding up process.
CASTLE HARBOR: Fitch Holds BB- Rating on $3 Million Class C Notes
-----------------------------------------------------------------
Fitch has affirmed five classes of notes issued by Castle Harbor
II CLO Ltd.
These rating actions are effective immediately:
-- $21,000,000 class A notes at 'A';
-- $26,000,000 class B-1 notes at 'BBB';
-- $10,000,000 class B-2 notes at 'BBB';
-- $3,000,000 class C notes at 'BB-';
-- $8,350,000 combination notes at 'BBB'.
Castle Harbor II, which closed on Dec. 21, 2004, is managed by
Deerfield Capital Management LLC and has a reinvestment period
that ends in January 2012. Castle Harbor II is a synthetic
collateralized loan obligation (CLO) that provides investors with
leveraged exposure to a diversified portfolio of non-investment
grade leveraged loans. Castle Harbor II entered into a total
return swap with Bank of America, N.A., permitting the issuer to
participate in the total return of a portfolio of leveraged loans
with a notional amount of up to $360 million. Deerfield Capital
Management LLC is currently assigned a 'CAM1' CDO (collateralized
debt obligation) asset manager rating for leveraged loans by
Fitch.
These affirmations are the result of the deal having stable key
performance measures and stable performance of the individual
assets comprising the reference portfolio. Castle Harbor II is
performing as expected and has built excess spread to support the
credit enhancement across all classes of notes. According to the
March 31, 2007 trustee report, the principal account balance has
increased to $58,973,518 from $55,651,675 at the last review on
March 24, 2006. Also during this time, the total threshold value
cushion has increased to $41,761,170 from $37,224,776 at the last
review. The Fitch weighted average rating factor has increased to
23.50 ('B/B+') from 22.04 ('BB-/B+') since the last review, and
remains in compliance with its threshold of 24.91('B/B+'). During
this same period, the weighted average spread has only slightly
decreased to 2.52% from 2.56%. According to the March 31, 2007
trustee report, total impaired assets represent 0.27% of the total
portfolio.
The ratings of the classes A, B-1, and B-2 notes address the
likelihood that investors will receive full and timely payments of
interest and ultimate receipt of principal by the scheduled
maturity date. The ratings of the class C and combination notes
address the return of principal by the final maturity date. The
current rated balance of the class C notes is $2,365,852 and the
current rated balance of the combination notes is $7,008,683.
Fitch will continue to monitor and review this transaction for
future rating adjustments.
CHEMED CORP: Discloses Proposed Offering of $160 Mil. Senior Notes
------------------------------------------------------------------
Chemed Corporation will offer up to $160 million aggregate
principal amount of senior convertible notes due 2014 to qualified
institutional buyers. The company also intends to grant the
initial purchasers an option to purchase an additional $24 million
aggregate principal amount of the senior notes. As this offering
is a private placement, it will not be made to the general public.
The notes will be unsecured, unsubordinated obligations of the
company, will pay interest semi-annually, and will be convertible
upon satisfaction of certain conditions. The notes will be
convertible into cash up to the principal amount of the notes and,
with respect to any excess conversion value, into shares of the
company's capital stock. Holders of the notes will have the right
to require the company to repurchase for cash all or some of their
notes upon the occurrence of certain events. The interest rate,
conversion rate and other terms are to be determined by
negotiations between the company and the initial purchasers.
The company expects to enter into convertible note hedge
transactions with affiliates of the initial purchasers of the
notes and intends to use a portion of the net proceeds from this
offering to pay for the convertible note hedge transactions. The
company also expects to enter into separate warrant transactions
with the hedge counterparties, which would result in additional
proceeds to the company, and would partially offset the cost of
the convertible note hedge transactions.
In connection with the convertible note hedge and warrant
transactions, the hedge counterparties have advised the company
that they or their affiliates may enter into various derivative
transactions with respect to the capital stock of the company,
concurrently with or shortly following pricing of the notes.
These activities could have the effect of increasing or preventing
a decline in the price of the capital stock of the company
concurrently or following the pricing of the notes.
In addition, the hedge counterparties or their affiliates may from
time to time, following the pricing of the notes, enter into or
unwind various derivative transactions with respect to the capital
stock of the company and/or purchase or sell capital stock of the
company in secondary market transactions. These activities could
have the effect of decreasing the price of the capital stock of
the company and could affect the price of the notes during any
averaging period related to the conversion of notes.
The company also expects to use a portion of the net proceeds of
this offering to repurchase approximately $100 million of its
capital stock in negotiated transactions from institutional
investors concurrently with this offering and in open market
transactions after the completion of the offering. On
April 30, 2007, the company announced that its Board of Directors
increased the company's stock repurchase authorization to $163.6
million. On May 3, 2007 and May 4, 2007, respectively, the
company purchased an aggregate of 118,500 shares of its capital
stock for approximately $6.9 million at prices ranging from $57.12
per share to $59.00 per share. As a result of purchases since
April 30, 2007, $156.7 million is available for future Chemed
stock repurchases. The company intends to continue such
repurchases, and to use the remaining net proceeds to repay
borrowings under its revolving credit facility.
If the initial purchasers exercise their over-allotment option, or
if the company otherwise has proceeds remaining, the company may
use a portion of such net proceeds for general corporate purposes,
or to enter into additional convertible note hedge transactions,
or to repurchase additional shares of its capital stock in the
open market or in negotiated transactions.
As reported in the Troubled company Reporter on May 7, 2007, the
company also entered into a new bank credit facility agreement,
consisting of a $100 million five-year term loan and a$175 million
revolving credit agreement. The interest rate on the facility
agreement has a floating rate that is currently LIBOR plus 87.5
basis points. The term loan requires 10% amortization per year
and allows for early termination without any prepayment penalty.
Proceeds from this Facility Agreement will be used to fund the
redemption of Chemed's $150 million of 8-3/4% Senior notes due
2011 on May 4, 2007.
About Chemed Corp.
Based in Cincinnati, Ohio, Chemed Corp. (NYSE: CHE) --
http://www.chemed.com/-- fka Roto-Rooter, Inc., operates two
wholly owned subsidiaries: VITAS Healthcare and Roto-Rooter.
VITAS provides end-of-life hospice care and Roto-Rooter provides
plumbing and drain cleaning services.
* * *
As reported in the Troubled company Reporter on March 29, 2007,
Standard & Poor's Rating Services revised its outlook on the
hospice and plumbing/drain-cleaning services provider Chemed Corp.
to positive, from stable, and affirmed its existing ratings on
Chemed, including the 'BB-' corporate credit rating.
CLAIRE'S STORES: Moody's Puts Corporate Family Rating at B3
-----------------------------------------------------------
Moody's Investors Service assigned first time rating to Claire's
Stores, Inc., including a corporate family rating of B3 as well as
a B1 rating on the senior secured credit facilities. Moody's also
assigned a speculative grade liquidity rating of SGL-3. The
ratings outlook is stable. All ratings are conditioned upon
review of final documentation.
These ratings are assigned:
* Corporate family rating at B3;
* Probability of default rating at B3;
* $200 million senior secured revolving credit facility at
B1 (LGD3,31%)
* $1,450 million senior secured term loan at B1 (LGD3,31%)
Speculative grade liquidity rating at SGL-3.
Claire's Stores, Inc. has signed a definitive agreement to be
acquired by Apollo Management for $33.00 per share or a
transaction value (including fees and expenses) of approximately
$3.3 billion. The transaction is expected to financed with the
proceeds of the new bank facilities (about 44% of the transaction
value), nearly $283 million of excess cash (about 9%),
approximately $935 million of junior debt capital (about 29%), and
approximately $597 million in common equity contributed by Apollo
(about 18%).
The B3 corporate family rating primarily reflects Claire's weak
capital structure pro forma for the company's acquisition by
Apollo. Moody's expects the transaction to be financed
approximately 73% with debt and that the financial sponsor will be
contributing approximately 18% of the transaction value in the
form of common equity. This level of capital contribution is much
lower than the average percentage of financial sponsor investment
in specialty retail LBOs during YTD 2007 and 2006, which Moody's
estimates to be around 35%. This weak capital structure results
in very high leverage with debt/EBITDA of 7.8 times and also
results in debt well exceeding annual revenues, as reflected by
funded debt/revenues of 160%. In addition, coverage metrics would
be weak. Using the company's reported fiscal year numbers and pro
forma for the transaction, EBITDA-capital expenditures/ interest
expense would be 1.0 time and the company's free cash flow would
be modestly negative.
Claire's Stores, Inc. has numerous strong business factors, which
are generally more indicative of a higher rating category.
Claire's has very high brand recognition and is one of a handful
of retailers that is truly internationally diversified with 31% of
its revenues and 22% of its operating income generated outside of
North America. The company's healthy operating margins of 18%
place it well ahead of its specialty retail peers and it has a
track record of broadly matching consumer trends as evidenced by
its average comparable store sales growth. However, upon closing
of the LBO a new CEO will replace the founder's daughters, who
currently serve as co-CEO's. In addition, Moody's is concerned
that the company's implementation of its new POS system, which
will run into its back-to-school season just prior to holiday,
does not leave it adequate time to address any potential issues
with the conversion should they arise. The 16 factors cited in
Moody's Global Retail rating methodology and the company's
financial metrics pro forma for the LBO for the period ended
February 3, 2007, would map to a B1 corporate family rating -- two
notches higher than the actual B3 corporate family rating. This
two notch differential reflects the company's weak capital
structure and the resulting very weak credit metrics which leave
the company little cushion to endure potential margin erosion
while still being able to meet its high interest expense and
likely capital expenditure requirements.
Claire's Stores, Inc., headquartered in Pembroke Pines, Florida,
is the leading specialty retailer of value-price jewelry and
fashion accessories for pre-teens, teenagers, and young adults.
It operates 2,992 stores in North America and Europe. Revenues
for the fiscal year ended February 3, 2007 were approximately
$1.5 billion.
CLEAR CHANNEL: In Talks with Equity Group on Amended Merger Offer
-----------------------------------------------------------------
The board of directors of Clear Channel Communications Inc. is in
discussions with the private equity group co-led by Bain Capital
Partners, LLC and Thomas H. Lee Partners, L.P. regarding a
possible change in the terms and structure of the proposed merger
between an affiliate of the private equity group and Clear
Channel.
Currently under discussion is a proposal that contemplates:
(i) an increase in the merger consideration to be paid to all
shareholders from $39.00 to $39.20 per share and
(ii) the opportunity for each unaffiliated shareholder to elect
between cash and stock in the surviving corporation in the
merger (up to an aggregate cap equivalent to 30% of the
outstanding shares immediately following the merger (or
approximately 6% before the merger)).
The board of directors rescheduled the Special Meeting of
Shareholders to Tuesday, May 22, 2007, at 1:00 p.m., Central
Daylight Savings Time, to allow the board of directors sufficient
time to complete its discussions with the private equity group,
consult with its significant shareholders and further develop the
buyer's proposal to issue in the merger equity in the surviving
corporation.
On May 3, 2007, the board of directors of Clear Channel, with L.
Lowry Mays, Mark Mays, Randall Mays and B.J. McCombs recused from
the vote, determined not to accept a similar proposal from the
private equity group, citing concerns that the change in structure
would require a delay in the date of the special meeting of up to
90 days with no certainty that the merger would be approved by the
company's shareholders. Since that time, a number of shareholders
of Clear Channel, including some of its largest shareholders, have
contacted members of the board or its financial advisor and asked
the board to delay the date of the special meeting in order to
provide them an opportunity to consult with the board on the
proposed change in structure and terms.
Shareholders of record as of March 23, 2007 will remain entitled
to vote at the Special Meeting to be held on May 22, 2007. The
proxy cards previously mailed to shareholders remain valid.
Shareholders with questions about the merger or how to vote their
shares should call the company's proxy solicitor, Innisfree M&A
Incorporated, toll-free at (877) 456-3427.
About Clear Channel
Based in San Antonio, Texas, Clear Channel Communications Inc.
(NYSE:CCU) -- http://www.clearchannel.com/-- is a global media
and entertainment company specializing in "gone from home"
entertainment and information services for local communities and
premiere opportunities for advertisers. The company's businesses
include radio, television and outdoor displays. Outside U.S., the
company operates in 11 countries -- Norway, Denmark, the United
Kingdom, Singapore, China, the Czech Republic, Switzerland, the
Netherlands, Australia, Mexico and New Zealand.
* * *
As reported in the Troubled Company Reporter on April 23, 2007,
Standard & Poor's Ratings Services lowered its corporate credit
and senior unsecured debt ratings on Clear Channel Communications
Inc. to 'B+' from 'BB+'. The ratings remain on CreditWatch with
negative implications, where they were placed on Oct. 26, 2006,
following the company's announcement that it was exploring
strategic alternatives to enhance shareholder value.
CRUM & FORSTER: Completes $330 Million 7-3/4% Sr. Notes Offering
----------------------------------------------------------------
Crum & Forster Holdings Corp., a wholly-owned subsidiary of
Fairfax Financial Holdings Limited, has completed its offering of
$330 million of 7-3/4% Senior Notes due May 1, 2017 at an issue
price of 100%. The 2017 Notes were sold on a private basis in the
United States pursuant to Rule 144A and outside the United States
pursuant to Regulation S under the Securities Act of 1933, with
registration rights.
Net proceeds of the offering, together with available cash on
hand, were used to purchase approximately $295.7 million of the
company's 10-3/8% Senior Notes due 2013, for approximately
$325.7 million, plus accrued and unpaid interest of approximately
$12.1 million, pursuant to the company's tender offer to purchase
for cash any and all of the outstanding 2013 Notes.
The company received consents from holders of approximately
$295.7 million of the outstanding 2013 Notes on or prior to
midnight, New York City time, on May 4, 2007 to adopt amendments
to the indenture governing the 2013 Notes in connection with the
tender offer and related consent solicitation, and such amendments
have become effective.
The pricing information for the tender offer was calculated as of
2:00 p.m., New York City time, on May 4, 2007, and is set forth
in:
-- 10-3/8% Senior Notes due 2013
Maturity Date - June 15, 2013
First Call Date/ Call Price - June 15, 2008
Applicable Spread - 50 bps/ $1,051.88
Reference Security - 4.875% UST due 05/31/2008
Relevant Bloomberg page - PX4
Reference Yield - 4.925%
Tender Offer Yield - 5.425%
Consent payment - $30.00
Total Consideration, including consent payment $1,101.21
The detailed methodology for calculating the total consideration
for validly tendered 2013 Notes is outlined in the company's Offer
to Purchase and Consent Solicitation Statement dated
April 23, 2007, which is available from the information agent.
Holders who validly tender 2013 Notes after the Consent Expiration
Date but on or prior to the Offer Expiration Date will be eligible
to receive as consideration the purchase price, which equals the
total consideration less the $30 consent payment per $1,000
principal amount of 2013 Notes.
In addition, holders of all 2013 Notes accepted for payment are
entitled to receipt of accrued and unpaid interest in respect of
such 2013 Notes from the last interest payment date prior to the
applicable settlement date to, but not including, the applicable
settlement date.
The tender offer will expire at midnight, New York City time, on
May 18, 2007, unless extended or earlier terminated. Consummation
of the tender offer, and payment for tendered notes, is subject to
the satisfaction or waiver of certain conditions described in the
Statement.
Requests for documentation should be directed to the tender and
information agent:
D. F. King & Co. Inc.
Tel: (800) 290-6429 (toll-free)
Questions regarding the tender offer and consent solicitation
should be directed to the dealer manager and solicitation agent
for the tender offer and the consent solicitation:
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Tel: (888) 654-8637 (toll-free), or
(212) 449-4914 (collect)
About Crum & Forster Holdings
Based in Morristown, New Jersey, Crum & Forster Holdings Corp. --
http://www.cfins.com/-- is a wholly owned subsidiary of Fairfax
Financial Holdings Limited (TSX and NYSE: FFH). Through eight
subsidiaries, the company offers an array of property/casualty
insurance products to businesses, including management liability,
automobile, and workers' compensation coverage.
* * *
As reported in the Troubled Company Reporter on April 27, 2007,
Fitch Ratings has assigned a 'B+' rating to Crum & Forster
Holdings Corp.'s $330 million issue of unsecured senior notes due
2017. Fitch has also affirmed C&F's 'BB-' Issuer Default Rating
(IDR) and 'B+' senior unsecured debt rating. The Rating Outlook
is Stable.
DILLARDS INC: Amends & Extends $1.2BB Senior Facility Until 2012
----------------------------------------------------------------
Dillard's Inc. has amended and extended its $1.2 billion senior
secured revolving credit facility an additional year to Dec. 12,
2012.
The company said that the amended facility is available for
general corporate purposes including, among other uses, working
capital financing, the issuance of letters of credit, capital
expenditures and, subject to certain restrictions, the repayment
of existing indebtedness and share repurchases.
The company said that there are no financial covenant requirements
under the credit agreement provided availability exceeds
$100 million.
JP Morgan Securities arranged the credit facility.
Headquartered in Little Rock, Arkansas, Dillards Inc. (NYSE: DDS)
-- http://www.dillards.com/-- is one of the nation's largest
fashion apparel and home furnishing retailers. The company's
stores operate with one name, Dillard's, and span 29 states.
Dillard's stores offer a broad selection of merchandise, including
products sourced and marketed under Dillard's exclusive brand
names.
* * *
As reported in the Troubled Company Reporter on April 18, 2007,
Fitch Ratings has upgraded Dillard's Inc.'s Senior Notes to 'BB'
from 'BB-' and Capital Securities to 'B' from 'B-'.
In addition, Fitch has affirmed its 'BB+' rating on Dillard's
$1.2 billion secured credit facility, which is backed by a pledge
of inventory. Dillard's had $1.3 billion of debt and hybrid
capital securities outstanding as of Feb. 3, 2007. The Outlook
is Stable.
DOMINO'S PIZZA: March 25 Balance Sheet Upside-Down by $561 Million
------------------------------------------------------------------
Domino's Pizza Inc. reported that for the first quarter ended
March 25, 2007, it had total assets valued at $420.7 million and
total liabilities of $981.9 million, resulting in a total
stockholders' deficit of $561.2 million.
Net income was $8.4 million, down 67.9% for the first quarter of
2007, as compared with a net income of $26.2 million for the first
quarter of 2006. The decrease in net income was driven primarily
by expenses incurred in connection with the company's
recapitalization as well as lower domestic franchise same store
sales growth, offset in part by continued strong performance in
our international operations.
Revenues were $339.3 million, down 2.4% for the first quarter of
2007, as compared with revenues of $347.7 million for the first
quarter of 2006. The decrease in revenues was due primarily to
lower international revenues and lower domestic distribution
revenues. Although international same store sales were up 3.8%,
revenues from international operations decreased 14% due to the
third quarter 2006 sale of company-owned operations in France and
the Netherlands to an existing master franchisee. Distribution
revenues decreased 1.4% on lower volumes due to a decrease in
domestic franchise same store sales.
David A. Brandon, Domino's chairman and chief executive officer,
said, "We are very pleased with the outcome of our recent
recapitalization and resulting $13.50 per share special cash
dividend. Shareholders have voiced strong support for our new
capital structure and our subsequent plans regarding the special
dividend and an open market share repurchase program. We believe
that this was the correct corporate finance decision for our
Company, as we leveraged our strong cash flows and created an
exceptional return of capital event for our shareholders."
Mr. Brandon continued, "Turning to the results of our first
quarter, we are still in the process of regaining the positive
domestic sales momentum we lost in 2006. I am encouraged by the
sales trend throughout the quarter, as the programs we have
implemented in our Team USA Company-owned stores are creating some
needed traffic and sales momentum. We expect our franchisees will
continue to implement similar programs and return to positive same
store sales very soon. We are working harder at the store level
to both operate and market more effectively. We are competing in
an environment where consumers are more demanding and more value
conscious. Traditional media channels are not as effective as
they have been in the past. We are addressing these environmental
issues aggressively. On a very positive note, our international
segment continues to perform very well. This quarter marked their
53rd consecutive quarter of positive same store sales comparisons,
again solidifying their position as a strong and steady growth
engine for our business."
Liquidity
As of March 25, 2007, the company had $785.7 million in total
debt, $67.1 million of cash and cash equivalents, no borrowings
under its $100 million revolving credit facility, and letters of
credit issued under its revolving credit facility of
$33.9 million. Retained deficit as of March 25, 2007, stood at
$693.2 million.
In connection with its recapitalization, the company repaid all
borrowings under its 2003 senior credit facility and repurchased
and retired, at a premium, about $273.6 million of the Domino's
Inc. senior subordinated notes due 2011. In order to fund these
repayments, the company borrowed $780 million under a bridge term
loan facility. The company incurred $3.6 million in capital
expenditures during the first quarter of 2007 versus $4.2 million
in the first quarter of the prior year.
Full-text copies of the company's first quarter report for 2007
are available for free at http://ResearchArchives.com/t/s?1ea1
About Domino's Pizza
Headquartered in Ann Arbor, Michigan, Domino's Pizza Inc.
(NYSE: DPZ) -- http://www.dominos.com/-- through its primarily
franchised system, operates a network of 8,190 franchised and
company-owned stores in the U.S. and more than 50 countries.
Founded in 1960, the company has more than 500 stores in Mexico.
The Domino's Pizza(R) brand, named a Megabrand by Advertising Age
magazine, had global retail sales of nearly $5 billion in 2005,
comprised of $3.3 billion domestically and $1.7 billion
internationally.
EASTMAN KODAK: Posts $151 Million Net Loss in First Quarter 2007
----------------------------------------------------------------
Eastman Kodak Company reported financial results for the first
quarter of 2007.
The net loss for the first quarter of 2007 was $151 million,
compared with a net loss for the first quarter of 2006 of
$298 million, representing an improvement in earnings of
$147 million or 49%.
Sales totaled $2.12 billion, a decrease of 8% from $2.29 billion
in the first quarter of 2006. Digital revenue totaled
$1.21 billion, a 3% decrease from $1.25 billion.
Traditional revenue totaled $896 million, a 13% decline from
$1.02 billion in the year ago quarter. New Technologies revenue
was $13 million in the first quarter, compared with $16 million in
the year-ago period.
Kodak held $1.02 billion in cash and cash equivalents as of
March 31, 2007, consistent with the company's goal of maintaining
at least $1 billion in cash on its balance sheet.
As of March 31, 2007, the company's debt level was $2.75 billion.
With the completion of the sale of Kodak's Health Group to an
affiliate of Onex Corporation, the company has now fully repaid
approximately $1.15 billion of secured term debt.
Gross Profit was 20.2%, down from 20.5%, primarily attributable to
approximately $30 million of adverse silver and aluminum costs,
partially offset by the favorable impact of foreign exchange.
"I'm very pleased with our first-quarter performance, in which we
made significant progress on our two key objectives for 2007 --
new product success and cost reduction," Antonio M. Perez,
Chairman and Chief Executive Officer, Eastman Kodak Company, said.
"Thus far the year is proceeding on plan. Both our Consumer
Digital and Film Products groups were well ahead of plan. On the
product side, we successfully launched a revolutionary line of
inkjet products, and at the recent AIIM/On Demand Conference our
Graphic Communications Group introduced several award-winning
products that broadened our portfolio of solutions. We also
significantly reduced our SG&A expenses, improved our receivables
performance, and ended the quarter with more than $1 billion in
cash on our balance sheet. When we conclude the sale of our
manufacturing facility in Xiamen, China, we will have completed
the last, significant step in our manufacturing restructuring."
At this time, the company says it has not yet completed the full
balance sheet and cash flow analysis adjusted for the impact of
discontinued operations. The items will be detailed in the
company's first quarter Form 10Q filing on or before May 10, 2007.
However, the company relates that current estimates suggest that
the company achieved a year-over-year improvement in net cash
generation in the range of $175 million to $200 million. This
corresponds to an estimated improvement in net cash used in
continuing operations from operating activities in the range of
$150 million to $175 million, the company explains.
Updated 2007 Outlook
Kodak remains focused on three financial metrics as it continues
to transform its business:
* net cash generation,
* digital earnings from operations and
* digital revenue growth.
The company has decided to increase its inkjet investment by as
much as $50 million in order to fully capitalize on strong
customer reaction. As a result, the company expects net cash
generation this year of greater than $100 million (after
restructuring cash disbursements of approximately $600 million),
compared with the previous net cash generation estimate of
$100 million to $200 million.
The company also expects 2007 full-year digital earnings from
operations of $150 million to $250 million.
The company further says that it continues to forecast 2007
digital revenue growth of 3% to 5%, with total 2007 revenue
expected to be down between 4% and 7%.
About Eastman Kodak Company
Headquartered in Rochester, New York, Eastman Kodak Company --
http://www.kodak.com/-- is a worldwide vendor of imaging
products and services. The company has operations in India,
Australia, China, Hong Kong, Japan, Korea, Malasia, New Zealand,
Philippines, Singapore, Taiwan and Thailand.
EASTMAN KODAK: Sells China Assets to Xiamen Land for $40 Million
----------------------------------------------------------------
Eastman Kodak Company has agreed to sell its buildings, land use
rights, and public utility equipment located on its Haicang Site
in Xiamen, China, to Xiamen Land Development for approximately
$40 million.
Kodak has also entered into several building and utility equipment
leases with Xiamen Land in order to continue certain operations at
the site.
Kodak said that it expects the transaction will close by June 30,
2007. As a result of the transaction, Kodak will record a non-
cash charge of approximately $220 million in the second quarter
of 2007.
Eastman Kodak said that the sale is part of its restructuring
program.
Headquartered in Rochester, New York, Eastman Kodak Company --
http://www.kodak.com/-- is a worldwide vendor of imaging
products and services. The company has operations in India,
Australia, China, Hong Kong, Japan, Korea, Malasia, New Zealand,
Philippines, Singapore, Taiwan and Thailand.
EASTMAN KODAK: Moody's Affirms B1 Corporate Family Rating
---------------------------------------------------------
Moody's Investors Service has confirmed Eastman Kodak Company's B1
corporate family rating, concluding a review for possible
downgrade, which had been prompted by Kodak's May 2006
announcement of its health business sale.
On April 30, 2007, Kodak sold its health imaging business to Onex
Healthcare Holdings and received about $2.35 billion cash
(excluding Kodak's opportunity to earn an additional $200 million
if Onex realizes an internal rate of return in excess of 25% on
its investment). The rating outlook is stable.
The B1 corporate family rating reflects the significant challenges
that Kodak faces to replace revenue and cash flow from its
declining legacy film businesses, as well as the company's market
position, operating profit margin and free cash flow volatility,
asset returns (net of cash), financial leverage, and liquidity.
The stable rating outlook reflects Moody's expectation that Kodak
will continue to maintain liquidity and generate earnings
sufficient to withstand further secular declines of its legacy
film businesses, lack of substantial profitability in certain of
its digital businesses, and its sizeable new business start up
costs.
The ratings would experience downward rating pressure if the
company were to resume stock purchases, restructuring payments
were to exceed the company's forecast (range of $575 million to
$625 million in 2007), digital earnings were to decline, cash
balances were to fall below $1 billion, or the company's ratio of
debt to EBITDA were to exceed 4.0x. The ratings would experience
upward rating pressure if the company's recurring digital
operating earnings were to grow in excess of $350 million and the
company's ratio of debt to EBITDA were to represent 3.9x or less
on a sustained annual basis. By Moody's estimates, Kodak had an
approximate 2.2x ratio of debt to pre restructuring charge EBITDA
for the twelve months ended March 2007, adjusted for leases, under
funded pensions, the health business sale, and repayment of $1.15
billion term loans.
Rating upgraded:
* $1 billion 5 Yr Revolving Credit Facility (expires 2010),
Secured, Ba3 --> Ba1, LGD2, 18%
Ratings confirmed:
* B1 Corporate Family Rating
* $500 million Senior Notes due 2013, Unsecured, B2 LGD4, 68%
* $3 million Senior Term Note Debenture due 2018, Unsecured,
B2 LGD4, 68%
* $575 million Convertible Senior Notes due 2033, Unsecured,
B2 LGD4, 68%
* $250 million Senior Medium Term Notes due 2008, Unsecured,
B2 LGD4, 68%
* $10 million Senior Notes due 2021, Unsecured, B2 LGD4, 68%
Headquartered in Rochester, New York, the Eastman Kodak Company is
a worldwide provider of imaging products and services.
EDISON INT'L: Unit Closes Private Offering of $2.7 Bil. Sr. Notes
-----------------------------------------------------------------
Edison Mission Energy, an indirect subsidiary of Edison
International, has closed its previously announced private
offering of $2.7 billion in aggregate principal amount of its
Senior Notes.
Edison International also announced an early payment date of
May 7, 2007, in three previously announced cash tender offers and
consent solicitations by its Edison Mission Group subsidiary
companies. The tender offers and consent solicitations are
scheduled to expire on May 15, 2007.
Together with cash on hand, EME used the net proceeds of the
offering of the Senior Notes to:
* purchase approximately $587 million in aggregate principal
amount of its outstanding 7.73% Senior Notes due 2009;
* purchase $999.8 million in aggregate principal amount of the
8.75% Second Priority Senior Secured Notes due 2034 of its
indirect subsidiary, Midwest Generation, LLC;
* repay the outstanding amount of $327.8 million under MWG's
senior secured term loan facility; and
* make a dividend payment of $899 million to its parent,
Mission Energy Holding Company, which enabled MEHC to
purchase approximately $795.7 million of its 13.50% Senior
Secured Notes due 2008.
MEHC and EME expect to record a pre-tax loss of approximately
$242 million ($148 million after tax) on early extinguishment of
debt during the second quarter of 2007.
Amends Indentures to Modify Events of Default
The amendments to the indentures pursuant to which the EME 2009
Senior Notes, the MWG Second Priority Senior Secured Notes and the
MEHC Senior Secured Notes were issued and to the security
agreement for the MEHC Senior Secured Notes, which were proposed
in connection with the tender offers and consent solicitations,
are now operative.
The amendments to the indentures and the security agreement:
-- eliminate substantially all the restrictive covenants;
-- eliminate or modify several events of default;
-- eliminate or modify related provisions contained in each
indenture; and
-- in the case of the MWG Second Priority Senior Secured Notes
and the MEHC Senior Secured Notes, release the collateral
securing such notes.
The Senior Notes have been offered and sold within the United
States only to qualified institutional buyers in compliance with
Rule 144A under the Securities Act of 1933 and outside the United
States in compliance with Regulation S under the Securities Act.
The Senior Notes have not been registered under the Securities Act
or applicable state securities laws, and may not be offered or
sold in the United States absent registration or an applicable
exemption from the registration requirements of the Securities Act
and applicable state laws.
About Edison International
Based in Rosemead, California Edison International (NYSE:EIX) --
http://www.edison.com/-- is a public utility primarily engaged
in the business of supplying electric energy to a 50,000-square-
mile area of central, coastal and southern California, excluding
the City of Los Angeles and certain other cities.
ENTERGY NEW ORLEANS: Judge Brown Confirms Fourth Amended Plan
-------------------------------------------------------------
The Honorable Jerry A. Brown of the U.S. Bankruptcy Court for the
Eastern District of Louisiana has confirmed Entergy New Orleans
Inc.'s Fourth Amended Plan of Reorganization, as modified on
May 2, 2007.
The Modified Fourth Amended Plan provides, among other things,
for full repayment to ENOI's creditors owed as much as
$258,500,000. There will be no change to the company's work
force of approximately 400 employees.
According to ENOI's press statement, Judge Brown is expected to
sign a written order confirming the Modified Plan on May 7, 2007.
Once signed, the actual "effective date" for ENOI's Chapter 11
exit is the next business day, in which the company can then
operate out from under the Court's jurisdiction essentially
signaling that the Debtor has emerged from bankruptcy, the
company said in a press statement.
"[ENOI] emerging from bankruptcy is great news for our customers
and employees who deserved a positive signal that we were on the
road to recovery," Rod West, the company's president and chief
executive officer, said in a company statement. "We could not
have closed this unfortunate chapter in our company's history
without the Herculean efforts and sacrifice of our employees who
together worked tirelessly to rebuild our company, the city's
infrastructure and their own lives.
"This significant step toward returning to financial viability
could not have been achieved without the support of the New
Orleans City Council, Gov. Kathleen Blanco and the Louisiana
Recovery Authority," added Mr. West.
ENOI Plan Satisfies 13 Steps to Confirmation
In a memorandum filed by ENOI on May 2, Elizabeth J. Futrell,
Esq., at Jones, Walker, Waechter, Poitevent, Carrere & Denegre,
L.L.P., in New Orleans, Louisiana, told Judge Brown that ENOI
satisfies the confirmation requirements under Section 1129(a) of
the Bankruptcy Code, in that:
A. the Plan complies with the applicable Section 1129(1)
provisions, which are predominantly directed at compliance
with Sections 1122 and 1123 governing classification of
claims and the Plan contents;
B. ENOI has complied with the disclosure and solicitation
requirements pursuant to Section 1129(a)(2);
C. the Plan complies with Section 1129(a)(3) because it has
been proposed in good faith and not by any means forbidden
by law;
D. the Plan complies with Section 1129(a)(4) because any
payment made or to be made for services, costs and
expenses incurred in relation to ENOI's case or its Plan
has been approved by, or will be approved, by the Court;
E. ENOI complies with Section 1129(a)(5) by disclosing the
identity and affiliations of the proposed officers or
directors and the identity of any insider who will be
employed by the Recognized Debtor;
F. ENOI complies with Section 1129(a)(6) to the extent that
it is subject to the jurisdiction of any regulatory
commission, and any rate change under ENOI's Plan has been
approved or will be approved by that commission;
G. the Plan complies with Section 1129(a)(7) since holders of
Claims or Interests in an Impaired Class have either
accepted ENOI's Plan or they will receive or retain their
Claims or Interests under that Plan;
H. the Plan complies with Section 1129(a)(8) because each
Class of the Claims or Interests has either accepted ENOI's
Plan or is Unimpaired under that Plan;
I. the treatment of Administrative Expense and Priority Claims
complies with the applicable provisions of Section
1129(a)(9);
J. at least one Impaired Class of Claims has accepted the Plan
pursuant to Section 1129(a)(10);
K. confirmation of the Plan is not likely to be followed by
the liquidation or the need for further financial
reorganization of the Debtor as required under Section
1129(a)(11);
L. ENOI's Plan provides for payment on or before the Effective
Date of all quarterly U.S. Trustee's fees as required
under Section 1129(a)(12) and 28 U.S.C. Section 1930; and
M. the Plan satisfies Section 1129(a)(13) by providing for
the continued payment of retiree benefits for the duration
of the period that ENOI has obligated itself to provide
those benefits.
Under the Modified Plan, ENOI further waives three conditions to
the occurrence of the Plan Effective Date:
(a) The Debtor will have received, in cash, at least
$200,000,000 in Community Development Block Grant funds.
(b) The Debtor will have received, in cash, at least
$50,000,000 in Hurricane Katrina insurance proceeds.
(c) No material adverse change will have occurred from and
after the Plan confirmation date.
Specifically, ENOI is prepared to waive receipt of the additional
$28,900,000 in CDBG Funds and to waive actual receipt of the
$53,700,000 Hartford Settlement Proceeds as a condition to the
occurrence of the Effective Date.
ENOI also amends the Plan provisions regarding injunction,
exculpation, and releases by bondholders, the Debtor and the
Reorganized Debtor.
The Reorganized Debtor's Amended and Restated Articles of
Incorporation and Bylaws further provides that it will:
-- no longer provide the Unsecured Debt Provision;
-- prohibit the issuance of non-voting equity securities to
the extent required by Section 1123(a);
-- provide for the restriction of dividends contained in the
Plan; and
-- specify that the dividend restriction is not for the
benefit of, and does not affect the rights of, the
Preferred Interests for any purpose.
A full-text copy of ENOI's Modified Fourth Amended Plan is
available at no charge at:
http://ResearchArchives.com/t/s?1ea5
Grants & Insurance
ENOI previously received $171,700,000 in CDBG funds, which payment
is the first installment of a grant that positions the company to
return to business as usual without burdening its customers with
up to $200,000,000 of Hurricane Katrina storm costs.
According to the company's issued statement, the CDBG funding is
earmarked for reducing costs that would otherwise be borne by
ENOI customers associated with rebuilding the catastrophic damage
caused by Hurricane Katrina to the ENOI electric and gas systems.
In addition to CDBG assistance, Entergy Corp. recently engaged in
a $69,500,000 settlement agreement with Hartford Steam Boiler
Inspection and Insurance, a subsidiary of the AIG, Inc. insurance
company. ENOI will receive about $53,700,000 of the settlement
amount for damage to its facilities.
Much of the money needed to rebuild the natural gas system in the
next 13 years will come from insurance claims, not federal
grants, ENOI Chairman Daniel F. Packer said in an interview,
according to Steven Church of Bloomberg News.
"It will be hard to go back to that trough again," Mr. Packer
said about the prospect of more federal aid, Mr. Church notes.
ENOI will continue to press $250,000,000 worth of insurance
claims related to flood damage, Mr. Church reports, citing Mr.
Packer.
To date, ENOI has incurred more than $213,000,000 in Hurricane
Katrina storm restoration costs. ENOI estimates that it will
incur future storm restoration costs to rebuild its natural gas
system of approximately $465,000,000, according to the company
statement.
About Entergy New Orleans Inc.
Headquartered in Baton Rouge, Louisiana, Entergy New Orleans Inc.
-- http://www.entergy-neworleans.com/-- is a wholly owned
subsidiary of Entergy Corporation. Entergy New Orleans provides
electric and natural gas service to approximately 190,000 electric
and 147,000 gas customers within the city of New Orleans. Entergy
New Orleans is the smallest of Entergy Corporation's five utility
companies and represents about 7% of the consolidated revenues and
3% of its consolidated earnings in 2004. Neither Entergy
Corporation nor any of Entergy's other utility and non-utility
subsidiaries were included in Entergy New Orleans' bankruptcy
filing.
Entergy New Orleans filed for chapter 11 protection on Sept. 23,
2005 (Bankr. E.D. La. Case No. 05-17697). Elizabeth J. Futrell,
Esq., and R. Partick Vance, Esq., at Jones, Walker, Waechter,
Poitevent, Carrere & Denegre, L.L.P., represent the Debtor in its
restructuring efforts. Carey L. Menasco, Esq., Philip Kirkpatrick
Jones, Jr., Esq., and Joseph P. Hebert, Esq., at Liskow & Lewis,
APLC, represent the Official Committee of Unsecured Creditors.
When the Debtor filed for protection from its creditors, it listed
total assets of $703,197,000 and total debts of $610,421,000.
(Entergy New Orleans Bankruptcy News, Issue No. 45 Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
ENTERGY NEW ORLEANS: Fitch Revises Rating on Issuer Default to BB
-----------------------------------------------------------------
Fitch Ratings has revised Entergy New Orleans Inc.'s Issuer
Default Rating to 'BB'. In addition, Fitch has upgraded the
following reinstated security ratings of ENOI upon its emergence
from bankruptcy:
* First mortgage bonds to 'BBB-' from 'CCC';
* Preferred stock to 'BB' from 'CC'.
The Rating Outlook is Stable.
The ratings reflect credit metrics that are appropriate for the
category and business risk as well as lower sustainable operating
cash flows and a weaker operating profile. The ratings also
reflect the considerable capital spending requirements to repair
and restore the gas distribution system and, to a lesser extent,
the electric system.
Re-building of the system will occur as necessary to serve
returning customer load. The 2005 hurricanes destroyed a
significant portion of ENOI's customer base, reducing the number
of electric and gas customers by 50% and 55%, respectively, from
YE2004.
In addition, ENOI's electric customer mix has shifted to
59% commercial/industrial and 24% residential, from 48%
commercial/industrial and 35% residential. Fitch views commercial
and industrial demand as more elastic than residential demand.
Offsetting these concerns are ample cash on hand from insurance
proceeds and Community Development Block Grants, higher authorized
electric rates, the demonstrated commitment to rebuilding ENOI by
its parent, Entergy Corp., and reasonable support from state
lawmakers and city regulators.
In the reorganization plan, financial grants from Federal
agencies, financial support from Entergy Corp., insurance
proceeds, and a tariff adjustment permitted full recovery for
all pre-petition creditors and successful emergence from
bankruptcy. Fitch expects a full year of the rate increase to
result in improvements in credit metrics in 2007.
Changes to ENOI's ratings and Rating Outlook will depend on the
rate of load growth, the timing and amount of cost recovery, as
well as the timing and velocity of the rebuilding of the gas
system relative to receipt of additional insurance proceeds and
customer demand. Event risk from another large hurricane remains.
While ENOI is building a $75 million storm reserve, it will take
10 years to fully fund.
ENOI is an electric and gas utility that serves customers in and
around the city of New Orleans. ENOI is a wholly owned subsidiary
of Entergy Corp.
FORD MOTOR: To Halt Operations of Cleveland Casting Plant in 2009
-----------------------------------------------------------------
Ford Motor Company intends to idle the Cleveland Casting Plant in
2009, as part of the company's Way Forward plan to transform its
North American automotive business. In addition, the company will
defer production at Cleveland Engine No. 1, beginning in two
weeks, for approximately 12 months.
The actions are in line with Ford's commitment to match its
manufacturing capacity with actual customer demand.
"These are difficult actions, and we're approaching them with
great sensitivity because they involve our people," Joe Hinrichs,
Ford's vice president of North America Manufacturing, said.
"However, operating an efficient and competitive manufacturing
business is a key to our Way Forward plan to transform our
business back to sustained profitability."
Cleveland Casting opened in 1952 and employs 1,100 hourly and 118
salaried workers. It produces cast-iron components for engines
for Ford F-Series Super Duty trucks, Ford E-Series vans and Ford
Expedition and Lincoln Navigator SUVs.
Ford's intention to idle Cleveland Casting is consistent with the
company's move away from in-house casting operations. The company
will also end casting production at Ford facilities in Leamington,
United Kingdom and Windsor, Ontario.
Production activities at Cleveland Engine No. 1 are being deferred
for approximately one year to capitalize on production
efficiencies at Ford's Lima Engine Plant, in Ohio, where the
company now can produce all its Duratec 3.5-liter engines for the
Ford Taurus passenger car and Taurus X crossover, as well as other
models. Previously, Cleveland Engine No. 1 produced the Duratec
3.0-liter engine for prior models of the Ford Five Hundred
passenger car and Freestyle crossover. If demand warrants, Ford
says, production activities at Cleveland Engine No. 1 could resume
earlier than the planned 12 months.
Opened in 1951, Cleveland Engine Plant No. 1 currently employs 530
hourly and 47 salaried workers. When it returns to production,
the plant is slated to produce the Duratec 3.5-liter engine and a
variant for the Lincoln MKZ passenger car, Lincoln MKX crossover,
Ford Taurus, Ford Taurus X, Ford Edge crossover and Mercury Sable
passenger car. In addition, the plant will produce engines for
two all-new vehicles, the Lincoln MKS passenger car and Ford Flex
crossover.
Cleveland Engine Plant No. 2 will continue to operate as planned.
Opened in 1955, it currently employs 700 hourly and 85 salaried
workers. It produces two versions of 3.0-liter engines for the
Ford Fusion passenger car and Ford Escape crossover, Mercury Milan
passenger car and Mercury Mariner crossover, Mazda 6 passenger car
and Mazda Tribute crossover, as well as for the Ford Mondeo
passenger car for Europe and various Jaguar models.
25,000 Workers Gone
The company also disclosed that 25,000 factory workers, all of
whom accepted early retirement and buyout offers from Ford, left
the company's payroll, according to various sources.
As reported in the Troubled Company Reporter on Nov. 30, 2006,
Ford confirmed about 38,000 of its United Auto Workers union-
represented hourly workers have accepted package offerings for
voluntary separations from the company.
However, Poornima Gupta of Reuters relates that 2000 of them
withdrew their acceptance of the buyouts, which left 11,000
workers departing under the buyout program.
The buyout program, which was offered to the entire workforce of
Ford and its Automotive Component Holdings subsidiary a year ago,
was in conjunction with the company's four-year turnaround plan to
close 16 plants and cut 45,000 jobs.
About Ford Motor Co.
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles in
200 markets across six continents. With about 260,000 employees
and about 100 plants worldwide, the company's core and affiliated
automotive brands include Ford, Jaguar, Land Rover, Lincoln,
Mercury, Volvo, Aston Martin, and Mazda. The company provides
financial services through Ford Motor Credit Company.
* * *
As reported in the Troubled Company Reporter on Dec. 12, 2006,
Standard & Poor's Ratings Services affirmed its 'B' bank loan and
'2' recovery ratings on Ford Motor Co.
As reported in the Troubled Company Reporter on Dec. 7, 2006,
Fitch Ratings downgraded Ford Motor Company's senior unsecured
ratings to 'B-/RR5' from 'B/RR4'.
As reported in the Troubled Company Reporter on Dec. 6, 2006,
Moody's Investors Service assigned a Caa1, LGD4, 62% rating to
Ford Motor Company's $3-billion of senior convertible notes due
2036.
FOSTER WHEELER: Inks Pact Increasing 5-Year Facility to $100 Mil.
-----------------------------------------------------------------
Foster Wheeler Ltd. has signed an amendment, effective May 4,
2007, to its five-year senior secured domestic credit facility to:
a) increase the facility by $100 million;
b) reduce the pricing applicable to the $150 million synthetic
portion of the facility by 50 basis points per annum; and
c) provide a new option to increase the facility by an
additional $100 million at a later date.
"This amendment to the facility provides the increased bonding
capacity that we require to support the continued growth of our
operations and volume of business," said John T. La Duc, executive
vice president and chief financial officer. "The facility's
improved pricing reflects the recent upgrades to our credit
ratings by Moody's Investors Service and Standard & Poor's."
The company does not intend to borrow under the facility during
2007.
Based in Clinton, New Jersey, Foster Wheeler Ltd. (Nasdaq: FWLT) -
- http://www.fwc.com/-- is a global company offering, through its
subsidiaries, a broad rangeof design, engineering, construction,
manufacturing, project development and management, research and
plant operation services. Foster Wheeler serves the refining,
upstream oil and gas, LNG and gas-to-liquids, petrochemicals,
chemicals, power, pharmaceuticals, biotechnology and healthcare
industries.
* * *
As reported in the Troubled Company Reporter on Mar. 27, 2007,
Standard & Poor's Ratings Services raised its ratings on Foster
Wheeler Ltd., including its corporate credit rating to 'BB' from
'B+'. The Clinton, New Jersey-headquartered engineering and
construction company had total reported debt of approximately
$203 million at Dec. 29, 2006. The outlook is stable.
Asbestos Management Program
The company recorded a net gain from its asbestos management
program in 2006 of $100.1 million, reflecting a $115.6 million
gain from four insurance settlements and the successful appeal of
a court decision in the company's pending asbestos-related
insurance coverage litigation, and a $15.5 million charge in the
fourth quarter of 2006 resulting from the company's year-end
update of its 15-year estimate of its asbestos liabilities and
related assets.
GENCORP INC: Feb. 28 Balance Sheet Upside Down by $64.8 Million
---------------------------------------------------------------
GenCorp Inc.'s balance sheet as of Feb. 28, 2007, showed total
assets of $1 billion and total liabilities of $1.1 billion,
resulting in a $64.8 million stockholders' deficit. At Nov. 30,
2006, the company's stockholders' deficit stood at $96 million.
Sales of $150.8 million for the first quarter 2007 increased 18%
over $128.3 million in the first quarter 2006, reflecting growth
in a variety of space and defense systems programs including
Standard Missile, Orion, and Titan.
Net income for the first quarter 2007 was $28.5 million, compared
to a net loss of $16 million for the first quarter 2006. The
company's improved results were driven by:
(i) a $31.2 million gain in discontinued operations from a
negotiated early retirement of a seller note and an earn-
out payment associated with the divestiture of the Fine
Chemicals business in November 2005;
(ii) improved operating performance of the Aerospace and
Defense segment; and
(iii) lower corporate costs.
"Aerojet's first quarter was marked by sales growth, contract wins
and improvements in operating results and cash flows," Terry Hall,
president and chief executive officer, said. "Our Real Estate
segment is making good progress toward the entitlement of
approximately 6,400 acres of our Sacramento land. Our first
project, Rio Del Oro, is approaching the public hearing phase and
we are working closely with the community and Rancho Cordova
officials to make sure the project stays on schedule."
Total debt increased slightly to $464.8 million at Feb. 28, 2007,
from $462.4 million at Nov. 30, 2006. The cash balance, including
restricted cash, at Feb. 28, 2007 increased to $93.9 million
compared to $81 million at Nov. 30, 2006. Total debt less cash
decreased from $381.4 million at Nov. 30, 2006 to $370.9 million
as of Feb. 28, 2007. The $10.5 million decrease in total debt
less cash is the result of cash generated from a negotiated early
retirement of a seller note and an earn-out payment associated
with the Fine Chemicals business divestiture, offset by cash usage
by the Aerospace and Defense segment, interest payments, and
payments related to legacy business matters.
As of Feb. 28, 2007, the company had $70.5 million in outstanding
letters of credit issued under the $80 million letter of credit
subfacility and the company's $80 million revolving credit
facility was unused.
About GenCorp
Headquartered in Rancho Cordova, California, GenCorp Inc.
(NYSE: GY) -- http://www.GenCorp.com/-- manufactures aerospace
and defense products and systems with a real estate business
segment that includes activities related to the entitlement, sale,
and leasing of the company's excess real estate assets.
GLOBAL POWER: Selects BDO Seidman as Auditors
---------------------------------------------
Global Power Equipment Group Inc. and its debtor-affiliates ask
the U.S. Bankruptcy Court for the District of Delaware for
authority to employ BDO Seidman LLP as their auditors, nunc pro
tunc to April 30, 2007.
BDO Seidman will:
a. perform a consolidated audit of the financial statements of
Global Power and its subsidiaries for the year ended
Dec. 31, 2006, including the consolidated balance sheet of
Global Power and the related consolidated statements of
income and comprehensive income, stockholders' equity, and
cash flows;
b. express an opinion on the financial statements based on its
audit;
c. submit to the Debtors a report containing its opinion as to
whether the consolidated financial statements, taken as a
whole, are fairly presented based on generally accepted
accounting principles; and
d. inform the Debtors of any material errors, fraud, illegal
acts, misstatements, and any other significant deficiencies
or material weaknesses that it identifies.
Documents submitted to the Court did not disclose the Firm's
hourly rates.
To the best of the Debtors' knowledge, the Firm does not hold any
interest adverse to the estate and is disinterested pursuant to
Sec. 101(14) of the Bankruptcy Code.
The Debtors inform the Court that the Firm's retention is subject
to certain indemnity and limitation on liability provisions as
contained in an engagement letter dated April 20, 2007.
Based in Tulsa, Oklahoma, Global Power Equipment Group Inc. aka
GEEG Inc. -- http://www.globalpower.com/-- provides power
generation equipment and maintenance services for its customers in
the domestic and international energy, power and infrastructure
and service industries. The company designs, engineers and
manufactures a range of heat recovery and auxiliary equipment
primarily used to enhance the efficiency and facilitate the
operation of gas turbine power plants as well as for other
industrial and power-related applications. The company has
facilities in Plymouth, Minnesota; Tulsa, Oklahoma; Auburn,
Massachusetts; Atlanta, Georgia; Monterrey, Mexico; Shanghai,
China; Nanjing, China; and Heerleen, The Netherlands.
The company and 10 of its affiliates filed for chapter 11
protection on Sept. 28, 2006 (Bankr. D. Del. Case No 06-11045).
Attorneys at White & Case LLP and The Bayard Firm, P.A.,
represent the Debtors. Adam G. Landis, Esq., and Kerri K.
Mumford, Esq., at Landis Rath & Cobb LLP represents the Official
Committee of Unsecured Creditors. As of Sept. 30, 2005, the
Debtors reported total assets of $381,131,000 and total debts of
$123,221,000.
The Court has entered a second bridge order extending the Debtors'
exclusive period to file a plan until a hearing set for May 17,
2007.
GLOBAL POWER: Wants to Issue EUR1.1 Million L/C from DIP Facility
-----------------------------------------------------------------
Global Power Equipment Group Inc. and its debtor-affiliates seek
authority from the U.S. Bankruptcy Court for the District of
Delaware to amend the debtor-in-possession financing agreement
they entered into with Morgan Stanley Senior Funding Inc. and
Morgan Stanley & Co. as agents to the DIP Financing lenders.
The DIP Financing Agreement, which was approved by the Court on a
final basis on Jan. 9, 2007, permitted the Debtors to borrow up to
$85,000,000 from the DIP Financing Lenders.
Additionally, the DIP Financing Agreement provides for certain
restrictions on the use of the funds available to support
operations of the Debtors' foreign affiliates.
One of the exceptions to the restrictions provides that the
Debtors may issue to Braden-Europe BV, a non-Debtor foreign
affiliate of the Debtors, a synthetic letter of credit to support
obligations of certain of the Debtors and Braden-Europe arising
out of a project for a major customer of the Debtors.
Braden-Europe Credit Pact
Braden-Europe is the borrower under a credit agreement with ABN
AMRO Bank NV dated Feb. 14, 2005.
The BE Credit Agreement contains a covenant that requires Braden-
Europe to maintain a certain level of tangible net worth.
As of Dec. 31, 2006, ABN AMRO has alleged that Braden-Europe is
not in compliance with the tangible net worth covenant, due in
large part to the Debtors' commencement of the chapter 11 cases.
To resolve the issue and bring Braden-Europe back into compliance
under the BE Credit Agreement, Braden-Europe has requested that
the Debtors issue in favor of ABN AMRO an irrevocable standby
letter of credit for EUR1,100,000.
To issue the ABN AMRO L/C, however, the Debtors say they need to
amend the DIP Financing Agreement.
The Debtors believe that the amendment to the DIP Financing
Agreement will prevent disruption to the Braden-Europe operations,
which are integral to the value of the Braden Debtors and to the
efficient administration of the cases.
In addition, the Debtors believe that the Final DIP Order permits
them to enter into an amendment without the need for further Court
approval, however, the Debtors say they are asking the Court's
permission out of an abundance of caution and to provide the
greatest amount of transparency to the Court and all parties-in-
interest.
Furthermore, the Debtors explain that they do not seek in the
motion to increase the amounts they can borrow under the DIP
Facility, rather, they seek only to be permitted to use the
already authorized borrowings to protect the estate assets by
providing credit support for Braden-Europe.
The Debtors tell the Court that the DIP Lenders have consented to
the proposed amendment.
About Global Power Equipment Group Inc.
Based in Tulsa, Oklahoma, Global Power Equipment Group Inc. aka
GEEG Inc. -- http://www.globalpower.com/-- provides power
generation equipment and maintenance services for its customers in
the domestic and international energy, power and infrastructure
and service industries. The company designs, engineers and
manufactures a range of heat recovery and auxiliary equipment
primarily used to enhance the efficiency and facilitate the
operation of gas turbine power plants as well as for other
industrial and power-related applications. The company has
facilities in Plymouth, Minnesota; Tulsa, Oklahoma; Auburn,
Massachusetts; Atlanta, Georgia; Monterrey, Mexico; Shanghai,
China; Nanjing, China; and Heerleen, The Netherlands.
The company and 10 of its affiliates filed for chapter 11
protection on Sept. 28, 2006 (Bankr. D. Del. Case No 06-11045).
Attorneys at White & Case LLP and The Bayard Firm, P.A.,
represent the Debtors. Adam G. Landis, Esq., and Kerri K.
Mumford, Esq., at Landis Rath & Cobb LLP represents the Official
Committee of Unsecured Creditors. As of Sept. 30, 2005, the
Debtors reported total assets of $381,131,000 and total debts of
$123,221,000.
The Court has entered a second bridge order extending the Debtors'
exclusive period to file a plan until a hearing set for May 17,
2007.
GLOBAL POWER: Court Extends Lease Decision Period Until June 2007
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
the time within which Global Power Equipment Group Inc. and its
debtor-affiliates can assume or reject two unexpired leases of
nonresidential property.
Specifically, the Court gave the Debtors until June 15, 2007, to
decide on an April 12, 1994 agreement between Jason Incorporated,
a former affiliate of Global Power, and Metropolitan Life
Insurance Company for the lease of an office space at Two Warren
Place in Tulsa, Oklahoma. The Warren Place Lease expires on
Nov. 1, 2007.
The Debtors say they are currently in negotiations with
Metropolitan regarding further amendments to the Warren Place
Lease.
In addition, the Court gave the Debtors until June 11, 2007, to
decide on an agreement dated Jan. 29, 2001, between Braden
Manufacturing LLC and Braden Investors LLC for the lease of
certain premises at 5199 N. Mingo Road, in Tulsa, Oklahoma. The
terms of the Mingo Road Lease expires on Sept. 30, 2011.
Based in Tulsa, Oklahoma, Global Power Equipment Group Inc. aka
GEEG Inc. -- http://www.globalpower.com/-- provides power
generation equipment and maintenance services for its customers in
the domestic and international energy, power and infrastructure
and service industries. The company designs, engineers and
manufactures a range of heat recovery and auxiliary equipment
primarily used to enhance the efficiency and facilitate the
operation of gas turbine power plants as well as for other
industrial and power-related applications. The company has
facilities in Plymouth, Minnesota; Tulsa, Oklahoma; Auburn,
Massachusetts; Atlanta, Georgia; Monterrey, Mexico; Shanghai,
China; Nanjing, China; and Heerleen, The Netherlands.
The company and 10 of its affiliates filed for chapter 11
protection on Sept. 28, 2006 (Bankr. D. Del. Case No 06-11045).
Attorneys at White & Case LLP and The Bayard Firm, P.A.,
represent the Debtors. Adam G. Landis, Esq., and Kerri K.
Mumford, Esq., at Landis Rath & Cobb LLP represents the Official
Committee of Unsecured Creditors. As of Sept. 30, 2005, the
Debtors reported total assets of $381,131,000 and total debts of
$123,221,000.
The Court has entered a second bridge order extending the Debtors'
exclusive period to file a plan until a hearing set for May 17,
2007.
GRANDE COMM: Posts $141.6 Million Net Loss in Year Ended Dec. 31
----------------------------------------------------------------
Grande Communications Holdings Inc. reported a net loss of
$141.6 million for the year ended Dec. 31, 2006, compared with a
net loss of $89.8 million for the year ended Dec. 31, 2005.
Included in the company's net loss in 2006 is a non-cash goodwill
impairment loss of $93.6 million associated with acquisitions
completed in 2000 and 2002. In 2005, the goodwill impairment test
resulted in an impairment loss of $39.6 million, the entire amount
of goodwill associated with the wholesale reporting unit.
Operating revenues for 2005 and 2006 were $194.7 million and
$189.9 million, respectively, a decrease of $4.8 million, or 2%
primarily as a result of a $15.6 million decrease in operating
revenues from network services, partially offset by growth in
bundled services revenue of $10.8 million.
Adjusted EBITDA was $27.5 million and $31.1 million in 2005 and
2006, respectively, an increase of $3.6 million. The increase was
primarily due the increase in the gain on sale of assets of
$2 million from 2005 to 2006, and to a lesser extent, increasing
revenues from the addition of new customers through the build-out
of the network over such periods.
Adjusted EBITDA, which is EBITDA net of debt issuance costs,
goodwill impairments and non-cash stock-based compensation
charges, is a non-GAAP measure which is used by the company to
measure operating performance.
At Dec. 31, 2006, Grande had total cash and cash equivalents of
$43.9 million and $177.4 million of long-term debt outstanding,
net of current portion, and net of a warrant discount of
$1.9 million.
At Dec. 31, 2006, the company's balance sheet showed $345 million
in total assets, $226.1 million in total liabilities, and
$118.9 million in total stockholders' equity.
About Grande Communications
Headquartered in San Marcos, Tex., Grande Communications Holdings
Inc. -- http://www.grandecom.com/-- is a Texas-based
communications company providing residential and business
customers with high-speed Internet, local and long-distance
telephone and digital cable services over a single network.
* * *
As reported in the Troubled Company Reporter on June 8, 2006,
Standard & Poor's Ratings Services raised the ratings on
Grande Communications Holdings Inc., including its corporate
credit rating and senior secured notes, to 'B-' from 'CCC+'.
GREATER BAY: Moody's Puts Ratings Under Review & May Upgrade
------------------------------------------------------------
Moody's placed the long-term ratings of Greater Bay Bancorp and
its subsidiaries on review for possible upgrade. Greater Bay
Bank, N.A., the company's banking subsidiary, is rated C+ for
financial strength, A2 for long-term deposits, and Prime-1 for
short-term deposits. The action follows the announcement that
Wells Fargo & Company will acquire Greater Bay. The transaction
is valued at approximately $1.5 billion and will be all stock.
In placing Greater Bay's ratings under review for possible
upgrade, Moody's said Greater Bay's creditors and depositors will
benefit from becoming part of Aaa-rated Well Fargo, which has a
larger and more broadly diversified banking franchise in the
Western and Midwestern U.S.
The review will focus on whether the deal will be completed and
the resulting organizational structure.
On Review for Possible Upgrade:
Issuer: Greater Bay Bancorp
* Issuer Rating, Placed on Review for Possible Upgrade,
currently A3
* Senior Unsecured Conv./Exch. Bond/Debenture, Placed on
Review for Possible Upgrade, currently A3
* Senior Unsecured Regular Bond/Debenture, Placed on Review
for Possible Upgrade, currently A3
Issuer: Greater Bay Bank, N.A
* Bank Financial Strength Rating, Placed on Review for
Possible Upgrade, currently C+
* Issuer Rating, Placed on Review for Possible Upgrade,
currently A2
* OSO Senior Unsecured OSO Rating, Placed on Review for
Possible Upgrade, currently A2
* Senior Unsecured Deposit Rating, Placed on Review for
Possible Upgrade, currently A2
Outlook Actions:
Issuer: Greater Bay Bancorp
* Outlook, Changed To Rating Under Review From Stable
Issuer: Greater Bay Bank, N.A
* Outlook, Changed To Rating Under Review From Stable
Greater Bay Bancorp has $7.4 billion in assets and is
headquartered in East Palo Alto, California. Wells Fargo and
Company, headquartered in San Francisco, California, reported
assets of $486 billion at March 31, 2007.
HOVNANIAN ENTERPRISES: Posts $54.6 Million Net Loss in First Qtr
----------------------------------------------------------------
Hovnanian Enterprises Inc. reported a net loss of $54.6 million
for the first quarter ended Jan. 31, 2007, compared with net
income of $84.1 million for the same period a year ago.
Results for the first quarter ended Jan. 31, 2007, included
$41.9 million in inventory impairment charges and a $51.5 million
impairment of intangibles related to the company's Fort Myers-Cape
Coral operations. The company attributed these charges to a
continued decline in sales pace and general market conditions, as
well as increasing cancellation rates, during the quarter.
Total revenues decreased 8.8% to $1.2 billion in the first quarter
of fiscal 2007, from total revenues of $1.3 billion in the first
quarter of fiscal 2006. Excluding unconsolidated joint ventures,
the company delivered 3,266 homes with an aggregate sales value of
$1.1 billion in the first quarter, down 15.1% compared to
deliveries of 3,845 homes with an aggregate sales value of
$1.2 billion in the first quarter of fiscal 2006.
Homebuilding gross margin, before interest expense included in
cost of sales, was 18.0% for the first quarter of fiscal 2007, a
760 basis point decline from 25.6% in the prior year's first
quarter. Total selling, general and administrative expense was
13.3% in the first quarter of fiscal 2007, compared with 12.8% in
the first three months of 2006.
"Our contract pace in the first quarter held steady in most of our
markets with the pace we achieved in the fourth quarter of last
year, as adjusted for normal seasonal factors," commented Ara K.
Hovnanian, president and chief executive officer of the company.
"However, we lowered prices in some of our community locations in
the beginning of the first quarter through additional incentives
and discounts in order to maintain the pace of sales that we were
targeting for those locations. Pricing has generally stabilized
since that time. In addition, conditions in our Fort Myers-Cape
Coral market continued to deteriorate considerably during our
first quarter, which led to further impairments in the first
quarter and contributed to lower expectations for deliveries,
gross margin and earnings for the full year," Mr. Hovnanian
stated.
"Our first quarter is always the slowest seasonal period for new
contracts, so it is difficult to get a good feel for the strength
of the market and what absorption rate to project for the rest of
the year in each of our communities. Most of our markets have
begun to show signs of stabilization, but we are not yet confident
that we have found the bottom of this housing slowdown," Mr.
Hovnanian said.
At Jan. 31, 2007, the company's balance sheet showed $5.3 billion
in total assets, $3.3 billion in total liabilities, $116.8 million
in minority interest from inventory not owned, $1.6 million in
minority interest from consolidated joint ventures, and
$1.9 billion in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Jan. 31, 2007, are available for
free at http://researcharchives.com/t/s?1e8e
About Hovnanian Enterprises
Headquartered in Red Bank, New Jersey, Hovnanian Enterprises Inc.
(NYSE: HOV) was founded in 1959 by Kevork S. Hovnanian, its
chairman. The company is a homebuilder with operations in
Arizona, California, Delaware, Florida, Georgia, Illinois,
Kentucky, Maryland, Michigan, Minnesota, New Jersey, New York,
North Carolina, Ohio, Pennsylvania, South Carolina, Texas,
Virginia, and West Virginia.
* * *
As reported in the Troubled Company Reporter on April 11, 2007,
Fitch Ratings affirmed its BB+ Issuer Default Rating on Hovnanian
Enterprises Inc.
HYDROCHEM INDUSTRIAL: Moody's Revises Outlook Stable from Positive
------------------------------------------------------------------
Moody's Investors Service changed the outlook of HydroChem
Industrial Services, Inc. to stable from positive and affirmed
other ratings. The change in outlook was prompted by the
company's proposed acquisition by Harvest Partners, LLC and the
resulting increase in leverage and effect on other credit metrics.
The proposed transaction will be financed in part through a
combination of first lien bank debt, which consists of:
* a $50 million senior secured revolver,
* a $40 million term loan, and
* a $100 million delayed term loan and,
also, second lien bank debt which comprises a delayed draw term
loan of $50 million.
The company proposes to retain the existing B3-rated $150 million
of 9.25% senior subordinated notes due 2013 in its capital
structure and intends to seek appropriate amendments under the
indenture which includes a change of control put option. The
first and second lien delayed draw term loans would be used to
replace any portion of the notes tendered under the put option.
The proposed financing (not rated by Moody's) also includes a
$35 million 12% PIK term loan at the parent level, HydroChem
Holding, Inc. The purchase price of $330 million represents an
estimated multiple of 8.4 times estimated adjusted EBITDA for the
period ended March 31, 2007.
HydroChem's ratings are constrained by the high proposed initial
leverage, the company's relatively small size, and constrained
long-term revenue growth prospects as the trend toward exporting
US manufacturing continues, and large exposure to the
petrochemical and refining industry. Rating constraints also
include a high percentage of intangibles on the balance sheet
comprising of about 69% of assets. The ratings benefit from the
company's position in the industrial cleaning industry, long-
standing client relationships, a stable underlying business, a
geographically diverse revenue stream, relatively small individual
job size, along with trends toward single-vendor service
relationships and centralized purchasing.
Weak free cash flow generation resulting from a slowdown in
industrial production and associated reduction in cleaning and
maintenance expenditures, declining operating margins,
unanticipated increases in capital expenditures, near-term
dividend payments or dilutive debt-financed acquisitions could
place negative pressure on the ratings.
Moody's expectations for an upgrade include adjusted debt to
EBITDA ratios comfortably below five times, which could be
achieved over a four to five year period. Other requirements
include continuing revenue growth combined with sustainable
adjusted free cash flow to debt ratios in excess of 5% while
maintaining adequate capital expenditures.
Moody's took these rating actions:
* Affirmed the B3 (LGD 4, 62%) rating on the $150 million
9.25% senior subordinated notes, due 2013;
* Affirmed the B2 Corporate Family Rating;
* Affirmed the B2 Probability of Default Rating.
The outlook for the ratings is stable.
To the extent that the subordinated noteholders tender the bulk of
the notes as part of this transaction and the senior secured
delayed draw term loans increase the amount of senior funded debt
by that same amount, the notes could be downgraded. The
affirmation is subject to the receipt of executed documentation in
form and substance acceptable to Moody's.
Headquartered in Deer Park, Texas, HydroChem Industrial Services,
Inc. is a leading North American provider of industrial cleaning
services to a diversified client base of over 800 customers, often
under long-term contracts, including Fortune 500 and S&P Global
1200 companies. The company offers hydroblasting, industrial
vacuuming, chemical cleaning, tank cleaning and related services
at over 90 operating locations, many of which are on the Gulf
Coast. The company's revenues are generated from services to the
petrochemical industry (50.7%), oil refining (28.3%), utilities
(9.3%), pulp and paper mills (3.0%), with the remainder (8.7%)
coming from other industries. Revenue for fiscal 2006 was
$247 million.
INDALEX HOLDINGS: Posts $22.3 Mil. Net Loss in Year Ended Dec. 31
-----------------------------------------------------------------
Indalex Holdings Finance Inc. reported a net loss of $22.3 million
for the year ended Dec. 31, 2006, compared with net income of
$23 million for the year ended Dec. 31, 2005.
For the fiscal year ended December 31, 2006, net sales were
$1.24 billion, compared to $1.02 billion for the fiscal year ended
Dec. 31, 2005. Extrusion shipment volume grew 4.8% as a result of
strong market demand, particularly in the Transportation, and
Commercial Building and Construction end-user markets.
Residential Building and Construction was strong early in the
year, but demand fell during the latter portion of 2006. Net
sales reflect higher base aluminum prices, which were up an
average of 33% in the fiscal year ended Dec. 31, 2006, compared to
the fiscal year ended Dec. 31, 2005.
Timothy R.J. Stubbs, president and chief executive officer, said,
"We had a strong first year as a stand-alone company, with solid
EBITDA growth and improvement in all of our key performance
metrics. However, the fourth quarter was a challenging quarter,
as the market continued to slow. Our focus on cash generation and
share gain paid dividends during the course of 2006, as we were
able to improve cash flow from operations, despite the headwinds
of higher interest costs and higher base metal pricing. The first
part of 2007 will also be challenging, but we continue to focus on
profitable share gain and cash generation going forward."
For the fiscal year ended Dec. 31, 2006, income from operations
was $700,000, compared to income from operations of $10.1 million
in the fiscal year ended Dec. 31, 2005. The decrease was due to a
$6.2 million increase in asset impairments, a $4.9 million
increase in expense related to mark-to-market on derivatives, an
increase of $4.7 million in audit and legal expenses related to
the filing of an SEC registration statement, a $3.4 million
increase in amortization of intangible assets, and an increase of
$1.3 million in restructuring expenses, partly offset by
improvements in underlying business, including higher shipment
volumes and improved margins.
For the fiscal year ended Dec. 31, 2006, Indalex generated cash
flow from operations of $34.6 million compared to cash flow from
operations of $26.8 million in the prior year. This improved
performance occurred despite a $17.9 million increase in cash paid
for interest and a 33% increase in base aluminum costs. The
company had $55.7 million of borrowings under its revolving credit
facility at Dec. 31, 2006.
At Dec. 31, 2006, the company's balance sheet showed
$597.7 million in total assets, $508.3 million in total
liabilities, and $89.4 million in total stockholders' equity.
About Indalex Holdings
Indalex Holdings Finance Inc. -- http://www.indalex.com/--
through its wholly owned subsidiary Indalex Holding Corp., and
Indalex Holding Corp.'s operating subsidiaries Indalex Inc. and
Indalex Ltd., is the largest independent producer of soft alloy
extrusion products and the second largest aluminum extruder in
North America. Indalex Ltd. owns approximately 25% of Asia
Aluminum Group, a Hong Kong-based aluminum extruder selling
products primarily in mainland China.
* * *
Indalex Holding Corp.'s 11-1/2% Second Priority Senior Secured
Notes due 2014 carries Moody's 'Caa1' and S&P's 'B-' ratings.
INTERNATIONAL PAPER: Earns $434 Mil. in First Qtr. Ended March 31
-----------------------------------------------------------------
International Paper Co. reported preliminary first-quarter 2007
net earnings of $434 million, as compared with fourth-quarter net
loss of $1.2 billion in the first quarter of 2006. Amounts in all
periods include special items, including the receipt of proceeds
from the sale of the majority of the company's U.S. forestlands in
the fourth quarter of 2006.
Quarterly net sales were $5.2 billion, compared with $5.3 billion
in the fourth quarter of 2006, and $5.5 billion in the first
quarter of 2006, primarily reflecting lower forestland sales.
Industry segment operating profits continued to rise to
$530 million for the 2007 first quarter versus $425 million in the
2006 fourth quarter and $411 million in the first quarter of 2006.
The increase reflects continued strong average price realizations
and strong manufacturing operations.
"We've hit the ground running in 2007 with our best first quarter
since 2000 and operational margins up nearly 300 basis points
versus the first quarter last year," said chairman and chief
executive officer John Faraci. "Our pricing momentum remains
strong, with volumes flat overall as we took some downtime and
shifted product among global markets to match our supply with our
customers' demand. Our manufacturing operations performed well
and improvements in cost and mix more than offset some overall
increases in input costs. We've also now bought more than $800
million in shares on the open market, which has brought our
outstanding share count down."
Commenting on the second quarter of 2007, Mr. Faraci said, "We
expect somewhat higher earnings from continuing operations in the
second quarter, with seasonally stronger volumes and improvements
in average price realizations. We continue to improve the
performance of our global manufacturing operations, and we'll
realize earnings from our first full quarter of operations from
the Luiz Antonio mill in Brazil. We expect that input costs will
remain high and also expect to have slightly higher maintenance
outage expense in the second quarter."
As of March 31, 2007, the company listed total assets of
$23.8 billion, total liabilities of $15.7 billion, and minority
interest of $236 million, resulting in a total shareholders'
equity of $7.9 billion.
Segment Information
Operating profits for Printing Papers were $231 million, up from
fourth quarter 2006 operating profits of $191 million, excluding
special items. Industrial Packaging operating profits were
$103 million, compared with $130 million in the prior quarter.
Consumer Packaging operating profits were $61 million in the first
quarter, up from $27 million in the 2006 fourth quarter, due to
higher earnings in U.S. and European coated paperboard and
foodservice businesses, as well as contributions from the IP-Sun
Paper joint venture in China. The company's distribution
business, xpedx, reported record first-quarter operating profits
of $29 million compared with operating profits in the prior
quarter of $31 million. Sales revenues were slightly down versus
the fourth quarter of 2006 because of seasonal slowdowns in
volumes.
Forest Products operating profits declined to $100 million from
fourth-quarter operating profits of $162 million. Net corporate
expense totaled $164 million for the quarter, essentially even
with $166 million in the 2006 fourth quarter and well below
$180 million for the 2006 first quarter.
About International Paper
Based in Stamford, Connecticut, International Paper Co.
(NYSE: IP) -- http://www.internationalpaper.com/-- is in the
forest products industry for more than 100 years. The company is
currently transforming its operations to focus on its global
uncoated papers and packaging businesses, which operate and serve
customers in the U.S., Europe, South America and Asia. Its
South American operations include, among others, facilities in
Argentina, Brazil, Bolivia, and Venezuela. These businesses are
complemented by an extensive North American merchant distribution
system. International Paper is committed to environmental,
economic and social sustainability, and has a long-standing policy
of using no wood from endangered forests.
* * *
International Paper Co. carries Moody's Investors Service Ba1
senior subordinate rating and Ba2 Preferred Stock rating.
ION MEDIA: Recapitalization Deal Cues S&P's Developing Watch
------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Ion Media
Networks Inc., including the 'CCC+' corporate credit rating, on
CreditWatch with developing implications. The CreditWatch
placement follows TV broadcaster Ion's announcement that it
entered into an agreement with Citadel Investment Group LLC and
NBC Universal Inc. for a comprehensive recapitalization of Ion.
West Palm Beach, Florida-based Ion owns and operates 60 broadcast
TV stations reaching more than 90 million homes. The company had
total debt (including preferred stock) of approximately
$2.6 billion as of Dec. 31, 2006.
"In resolving the CreditWatch listing," said Standard & Poor's
credit analyst Deborah Kinzer, "we will consider Ion's overall
operating outlook and future business strategies and will assess
the company's financial structure following the recapitalization."
JIA & SONS: Case Summary & Six Largest Unsecured Creditors
----------------------------------------------------------
Lead Debtor: J.I.A. & Sons Enterprises, Inc.
1115 Van Buren Street
Des Plaines, IL 60018
Bankruptcy Case No.: 07-08321
Debtor-affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Akhile & Company, L.L.C. 07-08326
Type of Business: The Debtors are diversified import-export,
e-commerce, and publishing companies. Their
business activities include international and
domestic trade.
See http://www.jiaenterprisesinc.com/
Chapter 11 Petition Date: May 7, 2007
Court: Northern District of Illinois (Chicago)
Judge: Pamela S. Hollis
Debtors' Counsel: Timothy C. Culbertson, Esq.
Morgan & Bley, Ltd.
900 West Jackson Boulevard, Suite 4
East Chicago, IL 60607
Tel: (847) 913-5945
Fax: (847) 639-0336
Estimated Assets Estimated Debts
---------------- ---------------
JIA & Sons Enterprises, Inc $1 Million to $1 Million to
$100 Million $100 Million
Akhile & Company, LLC $1 Million to $1 Million to
$100 Million $100 Million
A. JIA & Sons Enterprises, Inc's Four Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
S.M.R. Enterprises, Inc. $450,000
1110 West Lake Cook Road,
Suite 290
Buffalo Grove, IL 60089
People's Energy $120,733
1455 North Milwaukee Avenue
Chicago, IL 60622
City of Chicago unknown
Law Department
30 North LaSalle, Suite 700
Chicago, IL 60604
City of Chicago water at $18,303
Water Management Dept. multiple
locations
B. Akhile & Company, LLC's Two Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
People's Energy $12,336
1455 North Milwaukee Avenue
Chicago, IL 60622
City of Chicago $1,071
Water Management Dept.
333 South State Street
Chicago, IL 60604
KANSAS CITY MALL: Wyandotte County Gets OK to Pursue Condemnation
-----------------------------------------------------------------
A bankruptcy judge ruled in favor of Wyandotte County's Unified
Government permitting the County to proceed with its efforts to
condemn Indian Springs Marketplace shopping center in Kansas City,
Mark Wiebe of The Kansas City Star reports.
In his decision, Judge Robert D. Berger noted that the negligence
of the mall's owners -- Kansas City Mall Associates -- complicated
plans to turn the site into a business park.
The source relates that the County previously obtained a favorable
ruling from a Wyandotte County District Court judge stating that
the County had authority to conduct eminent-domain proceedings
against the mall.
Based in Beverly Hills, Calif., Kansas City Mall Associates Inc.
filed a chapter 11 petition on March 22, 2007 (Bankr. D. Kans.
Case No. 07-20581) following a mall demolition dispute with
the Unified Government of Wyandotte County. Carl R. Clark, Esq.,
at Lentz & Clark, P.A., represents the Debtor. When the Debtor
filed for protection from its creditors, it listed estimated
assets and debts between $1 million and $100 million.
KATUN CORP: Weak Performance Cues S&P to Cut Credit Rating to B-
----------------------------------------------------------------
Standard & Poor's Rating Services lowered its corporate credit
rating on Minneapolis, Minnesota-based Katun Corp. to 'B-' from
'B+', and placed it on CreditWatch with developing implications.
"The downgrade reflects weak operating performance and cash flow
from operations, and limited financial flexibility, because of
existing bank loan agreements, said Standard & Poor's credit
analyst Martha Toll-Reed.
Privately held Katun distributes copier and laser printer
replacement parts and supplies, and had fiscal 2006 revenues of
about $400 million. S&P will meet with management and discuss the
company's operating and financial strategy before resolving the
CreditWatch placement. Ratings could be lowered if the company
fails to satisfactorily address near-term liquidity constraints.
However, the renegotiation or refinancing of the existing bank
loans could lead to ratings improvement.
KIK CUSTOM: Moody's Junks Rating on $240 Million Second-Lien Loan
-----------------------------------------------------------------
Moody's Investors Service assigned KIK Custom Products Inc. a B2
corporate family rating.
Moody's also assigned a Ba3 rating to KIK's proposed first lien
senior secured credit facilities and a Caa1 rating to its second
lien term loan. Proceeds from the credit facilities combined with
$160 million of preferred and common equity will be used to fund
Caxton-Iseman Capital, Inc.'s proposed acquisition of the company
for approximately $725 million, which includes the redemption of
investors' interests in KCP Income Fund. This transaction is
expected to close in May. Proceeds from the financing will also
be used to refinance existing debt and fund an acquisition. The
ratings outlook is stable. This is a first time rating for the
company. The ratings are subject to review of final
documentation.
These ratings were assigned:
KIK Custom Products Inc.
* Corporate family rating at B2;
* Probability-of-default rating at B2;
* $55 million senior secured revolving credit facility due
2013 at Ba3 (LGD3, 32%);
* $400 million first lien senior secured term loan due 2014
at Ba3 (LGD3, 32%);
* $240 million second lien senior secured term loan due 2014
at Caa1 (LGD5, 80%).
The B2 rating is primarily driven by KIK's high leverage, thin
interest coverage, and modest cash flows relative to debt. The
ratings also consider the company's exposure to volatile raw
material costs within the private label bleach business,
acquisition risk as the company seeks to expand its contract
manufacturing business, and the uncertain response of its retail
customers to potential bleach price increases. The rating also
reflects the company's thin operating margins and some product
concentration with bleach accounting for roughly 20% of revenues.
Notwithstanding these risks, the rating is supported by the
company's approximately 40% share of the domestic bleach market,
its position as the largest contract manufacturer for major
consumer product companies, a diverse customer base, the vertical
integration of its bleach manufacturing facilities, the relative
stability of its end markets, some pricing flexibility with bleach
customers as evidenced by past price increases, and significant
barriers to entry.
The stable outlook reflects Moody's expectation that KIK will
sustain the current volume of business and continue to offset any
further raw material inflation in the private label bleach
business with price increases, such that Debt/EBITDA will not
exceed 7.0 times and EBITA/Interest Expense will be at least 1.0
times (including implied interest from debt component of the
preferred equity) twelve months following the transaction. The
stable outlook also reflects Moody's expectation that the company
will not encounter any unforeseen challenges as it unwinds the
Canadian income trust legal structure.
Headquartered in Ontario, Canada, KIK Custom Products Inc.
manufactures a variety of household cleaning, laundry, personal
care, over-the-counter and prescription drug product lines. The
company reported sales of $1.1 billion for the twelve months ended
December 31, 2006.
LAKESIDE CARE: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Lakeside Care Inc.
dba Brighten at Lakeside
One Fallsington Avenue
Tullytown, PA 19007
Bankruptcy Case No.: 07-12658
Chapter 11 Petition Date: May 4, 2007
Court: Eastern District of Pennsylvania (Philadelphia)
Judge: Bruce I. Fox
Debtor's Counsel: Albert A. Ciardi, III, Esq.
Ciardi & Ciardi, P.C.
One Commerce Square
2005 Market Street Suite 2020
Philadelphia, PA 19103
Tel: (215) 557-3550
Fax: (215) 557-3551
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
James F. Connor $449,940
Brighten Health Group
956 East Railroad Avenue
Bryn Mawr, PA
Mark Worthington $384,386
26 Beidler Drive
Washington Crossing, PA
18977
Raymond H. Miley, III $384,386
1126 Ellen Court
Schwenksville, PA 19473
Larry Burford $192,193
1403 Meadow View Way
Lady Lake, FL 32159
Laverne Clemens $192,193
644 Yoder Road
Harleysville, PA 19438
Stanley L. Worthington $192,193
83 Main Street
Fallsington, PA 19054
P.E.P.P. Unlimited $106,000
Helen Doderer $7,137
John Flynn $7,108
Stanley Hesko $6,427
Helen Russell $6,361
Irene Higgins $6,201
Hazel McIhenny $5,988
Edward Eyring $5,868
Frank Ramminger $5,863
Eleanor Wills $5,748
Jen MacElroy $5,598
Germanine Kalte $5,572
Helen Rubincam $5,455
Rosina Brown $5,488
LBI MEDIA: Incurs $1.3 Mil. Net Loss in Fourth Qtr. Ended Dec. 31
-----------------------------------------------------------------
LBI Media Inc. recognized a net loss of $1.3 million for the
fourth quarter 2006, as compared with a loss of $1.8 million for
the same period in 2005, a $500,000 improvement, primarily due to
a decrease in broadcast license impairment charges, partially
offset by increased deferred compensation expense and selling,
general and administrative expenses.
The company reported that for the quarter ended Dec. 31, 2006,
net revenues increased by $2.8 million, to $27.5 million from
$24.7 million for the same quarter last year. This increase is
attributable to revenue growth at the company's television
stations in Los Angeles and Texas and its newly acquired Dallas
radio stations. Operating expenses increased to $18.4 million
in the fourth quarter of 2006 from $12.5 million in the fourth
quarter of 2005.
Results for the Year 2006
The company recognized net income of $11 million for the year
ended Dec. 31, 2006, as compared with $6.9 million in 2005, an
increase of $4.1 million.
Net revenues increased $10.5 million, to $108 million for the year
ended Dec. 31, 2006, as compared with $97.5 million in 2005. This
increase is attributable to revenue growth at the company's
television stations and a slight increase in its radio division,
which was primarily the result of the performance of its Dallas
radio stations some of which were acquired in November 2006.
Television division net revenues increased $9 million, to $56.6
million for the year ended Dec. 31, 2006, from $47.6 million for
the same period last year. Radio division net revenues were up by
$1.5 million, to $51.4 million for the year ended Dec. 31, 2006,
from $49.9 million for the same period last year.
Operating expenses increased by $10.5 million, to $59.8 million in
2006 versus $49.3 million in 2005. This growth in operating
expenses was primarily due to increases in deferred compensation
expense, selling, general and administrative expenses and the
incremental costs associated with producing additional in-house
television programming.
Commenting on the company's results, Lenard Liberman, executive
vice president and chief financial officer of the company said,
"2006 was a great year for our company. Our organic revenue
growth of 11% was industry leading when compared to publicly
traded Hispanic-broadcasting companies. Our television station
revenues continue to benefit from a wider acceptance by our
viewers and by our advertisers for our programming line-up. Also
we have begun to see better revenue growth in our radio division
and we are very optimistic about radio in 2007. The addition of
four FM stations and one AM station in Dallas is particularly
exciting given our success in that market over the years."
The company's balance sheet as of Dec. 31, 2006, showed total
assets of $480.7 million and total liabilities of $388.3 million,
resulting in a total stockholders' equity of $92.4 million.
The company's December 31 balance sheet also showed strained
liquidity with total current assets of $21.1 million available to
pay total current liabilities of $28.4 million.
A full-text copy of the company's 2006 annual report is available
for free at http://ResearchArchives.com/t/s?1e95
Recent Developments
On March 30, 2007, affiliates of Oaktree Capital Management LLC
and Tinicum Capital Partners II, L.P. purchased about 113 shares
of Class A common stock of the company's parent, Liberman
Broadcasting Inc. for an aggregate purchase price of $155 million.
The investors will own about 39% of the economic interest Liberman
as a result of the purchase.
Liberman intends to use a portion of its net proceeds to repay its
junior subordinated notes due 2014 and related warrants primarily
held by affiliates of Alta Communications L.P. and to contribute
the remainder of the net proceeds to the LBI Media. LBI Media
intends to use the net proceeds to repay about $47.9 million of
its outstanding indebtedness under its senior revolving credit
facility. After giving effect to the repayment with the net
proceeds from this offering, it will have about $54.1 million
outstanding under its senior revolving credit facility as of March
30, 2007.
Commenting on this transaction, Mr. Liberman said, "I am extremely
excited to have such outstanding institutions as Oaktree and
Tinicum as partners in our business. This is the third investment
Oaktree has made in LBI over the years and we have always valued
that relationship. I am confident that this transaction will put
LBI Media in a strong position to capitalize on future growth in
the Hispanic broadcasting sector."
About LBI Media
LBI Media, Inc. owns and operates Spanish-language radio and
television stations in the U.S. The company owns sixteen radio
stations and four television stations serving the Los Angeles, CA,
Houston, TX, Dallas-Ft. Worth, TX and San Diego, CA markets. The
company also owns a television production facility in Burbank,
California.
* * *
LBI Media Inc. carries Moody's Investors Service's B1 corporate
family rating.
LE NATURES: Committees File Joint Amended Ch. 11 Liquidation Plan
----------------------------------------------------------------
The Official Committee of Unsecured Creditors, the Ad Hoc
Committee of Secured Lenders, and the Ad Hoc Committee of Senior
Subordinated Noteholders, filed with the U.S. Bankruptcy Court for
the Western District of Pennsylvania their Joint Amended Chapter
11 Plan of Liquidation for Le-Nature's Inc. and its debtor-
affiliates.
Overview of the Plan
The Plan Proponents tell the Court that the Plan's primary
objectives are to:
-- liquidate the assets of the estates and prosecute causes of
action;
-- maximize the value of the ultimate recovery to all
creditors on a fair and equitable basis, compared to the
value they would receive if the assets of the Debtor was
liquidated under chapter 7 of the Bankruptcy Code; and
-- settle, compromise or otherwise dispose of certain disputes
and claims.
Treatment of Claims
Under the Plan, Administrative, Priority Non-Tax and Fee Claims
will be paid in full, in cash.
Holders of Priority Tax Claims will receive, either:
a. cash on the effective date of the Plan; or
b. deferred cash payments in equal annual installments
through the fifth anniversary of the Debtors' bankruptcy
filing, plus interest at 6% per annum.
Holders of Secured Claims will receive, in full satisfaction,
settlement, release, and discharge of and in exchange for their
claims:
a. tier one trust beneficial interest;
b. additional tier one trust beneficial interest, as a
result of the disallowance of any disputed claim; and
c. all proceeds distributed under the terms of the Plan and
the liquidation trust agreement.
Other Secured Claims holders will receive, in full satisfaction of
their claims, at the option of the Liquidation Trust:
(a) payment in cash from proceeds from the sale or disposition
of the collateral securing their claims, to the extent of
the value of any holder's lien on the property;
(b) surrender of the collateral securing their claims; or
(c) other distributions as that will satisfy the requirements
stated in Section 1129 of the Bankruptcy Code.
Subordinated Litigation Claims are entitled to:
(a) a pro-rata share of the tier three trust beneficial
interests;
(b) additional pro-rate share of the tier three trust
beneficial interests, as a result of the disallowance of
any disputed claim in this class; and
(c) all proceeds distributed pursuant to the terms of
the Plan and the Liquidation Trust Agreement.
Interest Holders will receive:
(a) Tier Four Trust Beneficial Interests;
(b) additional pro-rate share of the Tier Four Trust
Beneficial Interests, as a result of the disallowance of
any Disputed Interest in this Class; and
(c) all proceeds distributed pursuant to the terms of
the Plan and the Liquidation Trust Agreement.
Unsecured Claims
The Plan Proponents disclose that Unsecured Claims are divided
into three sub-classes:
* Lenders Unsecured Claims;
* General Unsecured Claims; and
* Unsecured Subordinated Notes Claims.
Under the Plan, Holders of Lenders Unsecured Claim will receive:
(a) Tier Two Trust Beneficial Interests;
(b) an additional pro-rata share of the Tier Two Trust
Beneficial Interests, as a result of disallowance of any
Disputed Claim under this class;
(c) and additional pro-rata share of the Tier Two Trust
Beneficial Interests, as a result of Turnover Enforcement
of Unsecured Subordinated Notes Claims distributions; and
(d) all proceeds distributed pursuant to the terms of the Plan
and the Liquidation Trust Agreement.
Creditors holding General Unsecured Claims will receive:
(a) Tier Two Trust Beneficial Interests;
(b) an additional pro-rata share of the Tier Two Trust
Beneficial Interests, as a result of disallowance of any
Disputed Claim under this class;
(c) all proceeds distributed pursuant to the terms of the Plan
and the Liquidation Trust Agreement.
Holders of Unsecured Subordinated Notes Claims will receive:
(a) Tier Two Trust Beneficial Interests;
(b) an additional pro-rata share of the Tier Two Trust
Beneficial Interests, as a result of disallowance of any
Disputed Claim under this class;
(c) all proceeds distributed pursuant to the terms of the Plan
and the Liquidation Trust Agreement, provided, however,
that the distributions will be deemed reallocated and
distributed on account of Lenders Unsecured Claims, as a
settlement of potential claims by Lenders for enforcement
of contractual subordination provisions in Senior
Subordinated Notes Indenture, in accordance with the
"Turnover Enforcement."
A full-text copy of the Joint Chapter 11 Plan of Liquidation for
Le-Nature's Inc. is available for free at:
http://www.researcharchives.com/bin/download?id=070508040242
About Le-Nature's Inc.
Headquartered in Latrobe, Pennsylvania, Le-Nature's Inc. --
http://www.le-natures.com/-- makes bottled waters, teas, juices
and nutritional drinks. Its brands include Kettle Brewed Ice
Teas, Dazzler fruit juice drinks and lemonade, and AquaAde
vitamin-enriched water.
Four unsecured creditors of Le-Nature's filed an involuntary
chapter 7 petition against the company on Nov. 1, 2006 (Bankr.
W.D. Pa. Case No. 06-25454). On Nov. 6, 2006, two of Le-Nature's
subsidiaries, Le-Nature's Holdings Inc., and Tea Systems
International Inc., filed voluntary petitions for relief under
chapter 11 of the Bankruptcy Code. Judge McCullough converted Le
Nature's Inc.'s case to a chapter 11 proceeding. The Debtors'
cases are jointly administered. The Debtors' schedules filed with
the Court showed $40 million in total assets and $450 million in
total liabilities.
Douglas Anthony Campbell, Esq., Ronald B. Roteman, Esq., and
Stanley Edward Levine, Esq., at Campbell & Levine, LLC, represents
the Debtors in their restructuring efforts. The Court appointed
R. Todd Neilson as Chapter 11 Trustee. Dean Z. Ziehl, Esq.,
Richard M. Pachulski, Esq., Stan Goldich, Esq., Ilan D. Scharf,
Esq., and Debra Grassgreen, Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub LLP, represent the Chapter 11 Trustee.
David K. Rudov, Esq., at Rudov & Stein, and S. Jason Teele, Esq.,
and Thomas A. Pitta, Esq. at Lowenstein Sandler PC, represent the
Official Committee of Unsecured Creditors. Edward S. Weisfelner,
Esq., Robert J. Stark, Esq., and Andrew Dash, Esq., at Brown
Rudnick Berlack Israels LLP, and James G. McLean, Esq., at Manion
McDonough & Lucas represent the Ad Hoc Committee of Secured
Lenders. Thomas Moers Mayer, Esq., and Matthew J. Williams, Esq.
at Kramer Levin Naftalis & Frankel LLP, represent the Ad Hoc
Committee of Senior Subordinated Noteholders.
MCCLATCHY COMPANY: Earns $9 Million in First Quarter Ended April 1
------------------------------------------------------------------
The McClatchy Company reported net income of $9 million for the
first quarter ended April 1, 2007, compared with net income of
$27.7 million for the same period ended March 26, 2006.
Revenues from continuing operations in the first quarter of 2007
were $566.6 million, compared to revenues from continuing
operations of $194.5 million in 2006. The increase in revenues
reflects the addition of 20 newspapers in the acquisition of
Knight Ridder on June 27, 2006.
Earnings from continuing operations of $14.5 million, compared to
earnings from continuing operations of $21.8 million in the first
quarter of 2006. A loss from discontinued operations of
$5.5 million reflects the results of the (Minneapolis) Star
Tribune newspaper, which was sold on March 5, 2007.
Earnings from continuing operations included a loss from its
investments in unconsolidated companies of $9.7 million, compared
to income in the first quarter of 2006 of $400,000. The company
attributed the loss to the operating results of its newsprint
investments and to seasonally low profitability at CareerBuilder,
Classified Ventures and the Seattle Times Company.
Interest expense from continuing operations of $53.8 million for
the first quarter of 2007 includes $5.7 million related to
$530 million in debt repaid from the proceeds of the sale of the
Star Tribune on March 5, 2007.
Commenting on first quarter results, Gary Pruitt, chairman and
chief executive officer, said, "In the first quarter of 2007 we
faced the toughest advertising climate we have seen in a number of
years. In particular, real estate and automotive advertising were
hurt by the continuing declines in sales of both homes and
domestic vehicles. Internet revenues were up 5.4%, as our online
employment revenues are being affected by the revised
CareerBuilder affiliate agreement. However, we continue to see
strong growth in other online advertising categories. Excluding
online employment advertising, our online advertising revenues
grew 17.0% in the quarter.
"We continued to focus on cost controls to help offset the impact
of the revenue challenges and reduced cash operating expenses by
6.3% on a pro forma basis in the quarter. As a result, our
operating cash flow grew slightly on a pro forma basis. Few
newspaper operations can make that claim.
"On April 16, we announced that we had joined an important
alliance with Yahoo! and 11 other newspaper companies. This
partnership presents opportunities for McClatchy and other
newspaper companies to grow online by boosting traffic, bolstering
search efforts and creating a state-of-the-art online ad network.
We examined many alternatives in determining that this represents
the right deal, with the right partners, at the right time. The
partnership has emerged as the newspaper industry's preferred
solution, and as more companies join, we expect that gravitational
pull will become even stronger."
About The McClatchy Company
The McClatchy Company (NYSE: MNI) -- http://www.mcclatchy.com/--
is the third largest newspaper company in the United States, with
31 daily newspapers and approximately 50 non-dailies. McClatchy-
owned newspapers include The Miami Herald, The Sacramento Bee, the
(Fort Worth) Star-Telegram, The Kansas City Star, The Charlotte
Observer, and The (Raleigh) News & Observer.
MCCLATCHY CO: Fitch Downgrades Issuer Default Rating to BB+
-----------------------------------------------------------
Fitch Ratings has downgraded McClatchy's issuer default rating and
senior unsecured notes (assumed as part of its acquisition of
Knight Ridder in June 2006) to 'BB+' and affirmed the bank
facility rating at 'BBB-'.
The Rating Outlook is Stable.
The McClatchy Company
-- Issuer default rating to 'BB+' from 'BBB-';
-- Senior unsecured bank credit facility affirmed at 'BBB-';
-- Senior unsecured term loan affirmed at 'BBB-';
-- Commercial paper to 'B' from 'F3'.
Knight-Ridder, Inc.
-- Issuer default rating to 'BB+' from 'BBB-';
-- Senior unsecured notes/debentures to 'BB+' from 'BBB-'.
The rating action reflects the implications of recent credit
rating downgrades which will result in the credit facility and
term loan receiving an unsecured guarantee from material operating
subsidiaries; providing it priority over unsecured claims under a
default scenario (assuming the court would not force
consolidation). As stated in our press release on June 27, 2006,
'Fitch recognizes that features of credit facility could have
implications for the KRI bonds that MNI assumed as part of the
acquisition as rating triggers in the facility could result in the
borrower guaranteeing the facility.'
Also, the rating action incorporates the risk that given the
company's depressed stock price and credit ratings, management may
extend its debt repayment time frame by taking some modest
shareholder friendly actions in the coming years. Even without a
shift in financial policy, operating performance has been weaker
than anticipated and Fitch believes that barring further asset
sales it could take longer than initially anticipated to restore
its balance sheet to investment grade levels.
However, Fitch notes that operating weakness has largely stemmed
from elements of the company's business that Fitch understood were
volatile; particularly classified advertising (and California and
Florida real estate classifieds specifically). McClatchy has met
Fitch's expectations on the elements of its plan that Fitch
believes it has more explicit control over: retail (local)
advertising growth, expense containment and exclusive dedication
of asset sale proceeds and free cash flow toward debt repayment.
Fitch remains focused on these three elements in evaluating the
company's financial policies and its performance as a sound
operator.
The company has ample liquidity. It has $264 million available on
its five-year $1 billion revolving credit facility due 2011 at
Dec. 31, 2006. Under its credit facility (as amended Apr. 2,
2007), the financial leverage covenant is 4.75 times (x) debt-to-
rolling latest 12-month EBITDA through Sept. 28, 2008, stepping
down to 4.25x from Dec. 28, 2008 through Sept. 27, 2009 and 4x
from Dec. 28, 2009 and thereafter.
MEDIA GENERAL: Moody's Withdraws Ba1 and Ba2 Ratings
----------------------------------------------------
Moody's Investors Service has withdrawn Media General, Inc.'s Ba1
Corporate Family rating and Ba2 Probability of Default rating.
Moody's has withdrawn these ratings for business reasons.
Withdrawals:
Issuer: Media General, Inc.
* Corporate Family Rating, Withdrawn, previously rated Ba1
* Probability of Default Rating, Withdrawn, previously rated Ba2
Outlook Actions:
Issuer: Media General, Inc.
* Outlook, Changed To Rating Withdrawn From Stable
Media General, headquartered in Richmond, VA, operates newspapers,
television stations and online enterprises, primarily in the
southeastern United States. Publishing assets include three
metropolitan, 22 daily and more than 100 weekly newspapers and
other publications. Broadcast assets include 22 network-affiliated
television stations.
MORGAN STANLEY: Moody's Lifts Rating on $20.8 Mil. Class H Certs.
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of two classes and
affirmed the rating of one class of Morgan Stanley Capital I Inc.,
Commercial Mortgage Pass-Through Certificates, Series 1997-C1 as:
* Class X-1, Notional, affirmed at Aaa
* Class G, $5,997,113, Fixed, upgraded to Aaa from Baa2
* Class H, $20,821,000, Fixed, upgraded to Baa3 from B1
As of the April 15, 2007 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 92.6%
to $47.3 million from $640.7 million at securitization. The
Certificates are collateralized by 19 mortgage loans ranging in
size from less than 1.0% to 23.0% of the pool with the top 10
loans representing 91.6% of the pool.
Four loans have been liquidated from the pool, resulting in
aggregate realized losses of approximately $5.4 million. There
are currently no loans in special servicing. Four loans,
representing 12.4% of the pool, are on the master servicer's
watchlist.
Moody's was provided with year-end 2005 operating results for
100.00% of the pool and partial-year 2006 operating results for
71.1% of the pool. Moody's loan to value ratio is 62.4%, compared
to 63.1% at last review and compared to 81.0% at securitization.
Moody's is upgrading Classes G and H due to increased
subordination levels from loan payoffs.
The top three loan groups represent 52.6% of the outstanding pool
balance. The largest loan group is the Manors Rollup Loan ($10.9
million - 23.0%), which is secured by three congregate care
facilities located in Lathem, Rochester and Vestal, New York. The
portfolio contains 235 beds and is 81.0% occupied, compared to
79.8%, at last review and compared to 96.7% at securitization.
The loan has amortized by approximately 18.6% and matures in
December 2016. Moody's LTV is 84.2%, compared to 94.0% at last
review and compared to 93.8% at securitization.
The second largest loan group is another Manors Rollup Loan
($8.6 million - 18.3%), which is secured by two congregate care
facilities located approximately 14 miles northeast of Buffalo in
Williamsville, New York. The portfolio contains 185 beds and is
79.0% occupied, compared to 80.0% at last review and compared to
84.8% at securitization. The loan has amortized by approximately
18.6% and matures in December 2016. Moody's LTV is 66.6%,
compared to 81.40% at last review and compared to in excess of
100.0% at securitization.
The third largest loan group is the Long Island Hebrew Living
Center Loan ($5.3 million -- 11.3%), which is secured by a
congregate care facility totaling 226 beds in the Far Rockaway
section of New York City. The loan has amortized by approximately
17.1% and matures in January 2012. Moody's LTV is 34.6%, compared
to 36.0% at last review and compared to 83.4% at securitization.
The pool's collateral is a mix of healthcare (52.6%), retail
(25.6%), lodging (10.9%), industrial and self storage (6.3%) and
multifamily (4.7%). The collateral properties are located in 11
states. The top five state concentrations are New York (52.6%),
Texas (10.0%), Illinois (9.0%), Virginia (8.8%) and Maryland
(8.0%). All of the loans are fixed rate.
MOUNTAINEER GAS: Fitch Downgrades Issuer Default Rating to BB-
--------------------------------------------------------------
Fitch Ratings has downgraded Mountaineer Gas Co. as:
-- Issuer Default Rating to 'BB-' from 'BB+';
-- Senior unsecured to 'BB' from 'BBB-';
-- Short-term debt to 'B' from 'F3'.
MGC's ratings also remain on Rating Watch Negative by Fitch.
MGC's downgrade reflects the lack of resolution of accounting
software implementation problems which have led to the company's
inability to produce audited financial statements in time to meet
reporting covenant requirements in its revolving credit facility
and senior unsecured notes. The ratings action also reflects
Fitch's expectation that actual results will be lower than
management projections.
Management attributes the accounting system problems to financial
software issues related to the introduction of an independent
accounting system in June 2006. Since the introduction, MGC has
been unable to submit financial statements in a timely basis for
subsequent quarterly and annual reporting periods.
MGC received waivers for the technical default that resulted from
the reporting covenant violation for the period ending Sept. 30,
2006. MGC is currently requesting a covenant waiver for the
reporting year ended Dec. 31, 2006.
While Fitch believes it is likely that MGC will obtain covenant
relief, accounting system implementation issues at MGC are viewed
by Fitch as a significant operational risk that may impair the
ability of MGC to continue financing its working capital needs
going forward. If credit metrics are below Fitch's expectations
and the accounting system issues are unresolved, then additional
negative rating actions are possible.
MGC is a local gas distribution company that serves 223,500
customers in West Virginia. MCG was purchased by a private
partnership between an affiliate of ArcLight Energy Partners Fund
II and IGS Utilities LLC in 2005.
MQ ASSOCIATES: Dec. 31 Balance Sheet Upside-Down by $281 Million
----------------------------------------------------------------
MQ Associates Inc. had a resulting from total assets of
$175.4 million, total liabilities of $386.7 million, and
redeemable preferred stock of $70 million, resulting in a total
stockholders' deficit of $281.3 million as of Dec. 31, 2006.
The company reported net revenue of $273.5 million for the year
ended Dec. 31, 2006, representing a decrease of $19.5 million from
net revenue of $293 million for the year ended Dec. 31, 2005. For
the year ended Dec. 31, 2006, the decrease in net revenue was
driven by the discontinuance of certain wholesale contracts, fewer
lower modality procedures, lower scan volumes generally and a net
reduction in centers.
Income from operations was $19.4 million for the year ended
Dec. 31, 2006, representing an increase of $4.9 million from
income from operations of $14.5 million for the year ended
Dec. 31, 2005. Income from operations for the year ended Dec. 31,
2006, includes a gain on the sale of three centers of
$2.3 million.
Net loss for the year 2006 was $23 million, down from a net loss
for the year 2005 of $29.2 million.
Capital expenditures were $28.3 million for the year ended
Dec. 31, 2006, as compared with $17.4 million for the year ended
Dec. 31, 2005. Cash provided by operating activities was
$25.1 million for the year ended Dec. 31, 2006, as compared with
$34.5 million for the year ended Dec. 31, 2005. The decrease was
primarily due to changes in cash flows provided by working capital
assets and liabilities.
At Dec. 31, 2006, the company had $341.9 million of indebtedness
outstanding, as compared with $337.7 million at Dec. 31, 2005.
The company's indebtedness primarily consists of $177.3 million
due under its 11-7/8% Notes due 2012, $112.1 million of accreted
value due under its 12-1/4% Notes and $51 million due under its
Tranche B term facility. The company would have been able to
borrow an additional $79.5 million, after giving effect to
$500,000 of outstanding letters of credit, under the revolving
credit facility to fund its working capital requirements and
future acquisitions at Dec. 31, 2006.
A full-text copy of the company's 2006 annual report is available
for free at http://ResearchArchives.com/t/s?1e94
About MQ Associates
MQ Associates, Inc. is a holding company and has no material
assets or operations other than its ownership of 100% of the
outstanding capital stock of MedQuest Inc. Headquartered in Salt
Lake City, Utah, MedQuest Inc. operates independent, fixed- site,
outpatient diagnostic imaging centers in the U.S. These centers
provide high quality diagnostic imaging services using a variety
of technologies, including magnetic resonance imaging, computed
tomography, nuclear medicine, general radiology, bone
densitometry, ultrasound and mammography. MedQuest Inc. operates
a network of 90 centers in thirteen states located primarily
throughout the southeastern and southwestern U.S.
NEW CENTURY: Gets Final OK to Obtain $150,000,000 DIP Financing
---------------------------------------------------------------
The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware authorized New Century Financial Corporation
and its debtor-affiliates to borrow up to $150,000,000, on a final
basis, from Greenwich Capital Financial Products Inc. in its
capacity as lender and administrative agent, and The CIT
Group/Business Credit Inc. in its capacity as lender and
documentation agent.
The terms and conditions of the DIP Loan Agreement are approved
in all respects.
The Debtors are authorized and directed to pay fees as they come
due under the DIP Loan Agreement to the secured parties without
further Court order, including the commitment fee, facility fee
and all reasonable out-of-pocket costs and expenses of the
Secured Parties, as provided under the DIP Loan Agreement. The
Official Committee of Unsecured Creditors' rights to challenge
the costs and expenses for reasonableness are reserved.
In providing for the advancement of postpetition financing under
the DIP Loan Agreement, each of the Debtors and the Secured
Parties stipulate that in entering into the DIP Loan Agreement,
until the time all DIP obligations are indefeasibly paid in full
in cash and the commitments are terminated in accordance with the
DIP Loan Agreement:
-- the Debtors will not in any way prime or otherwise
adversely affect the Secured Parties' liens by offering a
subsequent lender or party-in-interest a superior or pari
passu lien or claim;
-- the Debtors will not in any way grant junior encumbrances
on the collateral upon which the Secured Parties possess
liens. The Debtors will not otherwise encumber otherwise
unencumbered assets.
DIP obligations will have the status of allowed superpriority
administrative expense claims.
For the benefit of the Secured Parties, the Administrative Agent
will have a valid, binding and enforceable perfected security
interest in and to and lien on all the collateral, excluding
avoidance actions and their recoveries.
The enforceable first priority perfected security interest in and
to and lien on all the collateral:
-- is included in the Borrowing Base, subject as to priority,
in the case of the security interest in and to and lien on
all the collateral included in the Tranche B Borrowing
Base, only to the liens securing the obligations; and
-- except for collateral subject to liens existing on the
Petition Date securing the senior claims; provided,
however that should any lien securing a senior claim be
voided, extinguished or determined to be invalid, the
liens granted to the Secured Parties will be deemed
perfected first priority liens without any further action
by the Secured Parties or the Court.
The liens and security interests granted to the Secured Parties
will continue to be at all times first and senior in priority to
all other liens or security interest of every kind and will not
be subordinate or pari passu with any other liens or security
interest or right of set off, and no lien or security interest
will be permitted, which will be senior to or pari passu with the
liens and security interests. However, the Secured Parties'
liens will be junior and will subject to the valid, binding and
enforceable liens securing and set off, netting and recoupment
rights with respect to the senior claims as of the Petition Date.
The automatic stay is lifted to grant the Secured Parties' liens
and security interests to the Secured Parties contemplated by the
DIP Loan Agreement.
The Court also approves the carve-out for:
(a) amounts payable pursuant to 28 U.S.C. Section 1930(a)(6)
and any fees payable to the Court clerk; and
(b) allowed fees and expenses of attorneys, accountants and
other professionals retained in the Debtors' Chapter 11
cases pursuant to Sections 327 and 1103 of the Bankruptcy
Code. The amount entitled to priority will not exceed the
carve-out amount of $7,000,000 in the aggregate. The
sublimits are:
* priority professional expenses accruing after an event
of default will not exceed $4,000,000 in the
aggregate;
* unpaid priority professional expenses accrued before
the event of default will not exceed $3,000,000 in the
aggregate;
* Union Bank of California fees will not exceed
$440,000, conditioned upon UBC promptly allowing the
Debtors immediate access to their accounts.
So long as the event of default have not occurred, the Debtors
will be permitted to pay the priority professional expenses of
the kind specified in Section 503(b) of the Bankruptcy Code
allowed under Sections 330 and 331, as the same may be due and
payable; provided that the aggregate of payments made on or after
the occurrence of a default will not exceed the carve-out amount.
The Secured Parties will not consummate foreclosure on the
collateral or otherwise seize control of assets of the Debtors'
estates absent five business days' prior written notice of an
event of default to the Debtors, any official committee appointed
and the Office of the United States Trustee.
Neither the collateral nor Secured Parties will be subject to
surcharge, pursuant to Sections 506(c) or 105 or otherwise, by
any of the Debtors or any other party-in-interest, until all DIP
obligations are indefeasibly paid in full to the Secured parties
in cash.
The Debtors are authorized to maintain their cash management
system in a manner consistent with the DIP Loan Agreement and any
Court order.
The terms and conditions of the Final DIP Order and the DIP Loan
Agreement, and the Secured Parties' liens and security interests,
superpriority status of the administrative claims and payment
provisions will continue in full force and effect until the DIP
obligations are indefeasibly paid in full in cash, and the DIP
Loan Agreement is terminated.
Objections that have not been withdrawn, waived or settled, and
all reservations of rights included are denied and overruled.
About New Century
Founded in 1995 and headquartered in Irvine, California, New
Century Financial Corporation (NYSE: NEW) -- http://www.ncen.com/
-- is a real estate investment trust, providing mortgage products
to borrowers nationwide through its operating subsidiaries, New
Century Mortgage Corporation and Home123 Corporation. The company
offers a broad range of mortgage products designed to meet the
needs of all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. When the
Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a chapter 11 plan expires on July 31,
2007. (New Century Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
The Debtors' exclusive period to file a plan expires on July 31,
2007.
NEW CENTURY: Ellington's $58,000,000 Bid to Buy 2,000 Loans Wins
----------------------------------------------------------------
Ellington Management Group LLC emerged as the winning bidder for
the remaining mortgage portfolio of New Century Financial
Corporation, with its $58,000,000 bid topping five other offers
for 2,000 mortgage home-mortgage loans and related securities
offered for sale.
The assets sold to Ellington include a portfolio of mortgage
loans with a face value of $170,000,000 and rights to receive
streams of payment from some loans New Century sold off in past
deals.
Ellington's bid amounted to only 30 cents on the dollar with
respect to the face value of loans, but exceeded the 50,000,000
offered by Royal Bank of Scotland unit Greenwich Capital
Financial Products Inc.
Ellington's vice chairman, Larry Penn, told Bloomberg News that
many of the loans are delinquent, and others are "second-lien"
loans that may be worthless after the first priority mortgages
are satisfied. "It was a long auction and there were a number of
bidders," Mark S. Indelicato, Esq., at Hahn & Hessen, in New
York, on behalf of the Official Committee of Unsecured Creditors,
said.
The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware has approved the asset purchase agreement
between the Debtors and Ellington, dated as of May 2, 2007.
Judge Carey said in his sale order that the $58,000,000 offered
by Ellington represents the fair market value of, and constitutes
the highest and best offer for, the purchased assets, and will
provide a greater recovery for the Debtors' creditors than would
be provided by any other available alternative.
The Court previously authorized the Debtors to sell the mortgage
loans to Greenwich, subject to better and higher offers for the
mortgage loans at the auction, which was held on the week of
April 30. As a result of the sale transaction with Ellington,
the Court has authorized and directed the Debtors to pay a
$945,000 break-up fee to Greenwich.
The Court has determined that Ellington has negotiated the terms
and conditions of the Sale in good faith and at arm's length, and
is entering into the Sale in good faith and is a good faith
purchaser within the meaning of Section 363(m) of the Bankruptcy
Code. Ellington may close the Sale at any time after entry of
the order, including immediately after its entry.
The Debtors have been granted approval to sell the mortgage loans
free and clear of all liens, encumbrances, set off rights and
other interests against them or their estates.
All persons and entities holding liens or interests in all or any
portion of the Purchased Assets arising under or out of, in
connection with, or in any way relating to the Debtors, the
Purchased Assets, the operation of the Debtors' business prior to
the closing date, the transfer of the Purchased Assets to
Ellington, are forever barred, estopped and permanently enjoined
from asserting against Ellington or its successors or assigns,
their property, Purchased Assets, and an entity's liens or
interests in and to the Purchased Assets.
U.S. Bank National Association is directed to recognize on its
books and records the transfer to Ellington of any Purchased
Assets consisting of certified securities, which will constitute
proof of Ellington's authority to transfer, pledge or release the
certified securities following consummation of the Sale.
In the event any of the Purchased Assets consist of certified
securities that have been stolen, lost, destroyed or mutilated,
upon Ellington's delivery of a customary letter of indemnity or
similar assurance in accordance with the terms of the applicable
indenture in a form satisfactory to U.S. Bank, U.S. Bank is
directed to issue replacement certificates for the securities
notwithstanding any provisions to the contrary in any pooling and
servicing agreement or indenture related to the securities.
All entities, on or before the closing date, in possession of
some or all of the Purchased Assets to be transferred are
directed to surrender possession of the Purchased Assets to
Ellington on the closing date at the entity's sole expense.
All persons and entities are forever prohibited and enjoined from
taking any action that would adversely affect or interfere with
the ability of the Debtors to transfer the Purchased Assets to
Ellington.
The Court noted that:
-- to the extent any of the Purchased Assets consist of an
interest in a consumer credit transaction subject to the
Truth in Lending Act or an interest in a consumer credit
contract, Ellington will remain subject to the same claims
and defenses related to the consumer credit transaction or
contract to the same extent as Ellington would be subject
to the claims and defenses of the consumer the interest
had not been purchased pursuant to Section 363; any
-- any LNFA Mortgage Loans subject to the terms of the
stipulated preliminary injunction entered between the
State of Ohio, ex re. Marc Dann, Attorney General and New
Century Financial, New Century Mortgage Corporation, and
Home 123 Corporation on March 28, 2007, will not be sold,
assigned or transferred to Ellington or any third party
purchaser and will not constitute a Purchased Asset unless
Ohio consents in writing to the sale, assignment or
transfer of any LNFA Mortgage Loans, or the sale,
assignment or transfer of any LNFA Mortgage Loans is made
in accordance with the terms of the preliminary
injunction; and
-- the residuals to be transferred to Ellington or any third
party purchaser will not be sold or otherwise transferred
free and clear of, and will remain subject to, all the
terms and conditions of the relevant indenture or pooling
and servicing agreement and related securitization
documents that govern the residuals.
About New Century
Founded in 1995 and headquartered in Irvine, California, New
Century Financial Corporation (NYSE: NEW) -- http://www.ncen.com/
-- is a real estate investment trust, providing mortgage products
to borrowers nationwide through its operating subsidiaries, New
Century Mortgage Corporation and Home123 Corporation. The company
offers a broad range of mortgage products designed to meet the
needs of all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. When the
Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a chapter 11 plan expires on July 31,
2007. (New Century Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
The Debtors' exclusive period to file a plan expires on July 31,
2007.
NEW CENTURY: No Bids Received for Loan Origination Biz as of May 2
------------------------------------------------------------------
Brad A. Morrice, president and chief executive officer of New
Century Financial Corporation, said in a filing with the
Securities and Exchange Commission that New Century and its
debtor-affiliates have not received formal bids for the loan
origination platform assets by the May 2, 2007 deadline.
In a conference call covered by The Associated Press, Mr. Morrice
said that despite a number of potential buyers for the company's
wholesale and consumer-direct operations, "none of those
potential deals have come to pass."
The procedures set by the Debtors and duly approved by the U.S.
Bankruptcy Court for the District of Delaware did not set
minimum bids for the Loan Origination Platform assets, but
required purchasers to resume the Debtors' loan origination
business. Bidders were also required to provide cash deposit of
at least $3,000,000, and waiver of any breakup fee, expense
reimbursement or any similar type of payment.
The Court had authorized the Debtors to proceed with an auction
on May 9, contingent on the Debtors receiving at one or more
qualified bid for the Loan Origination Platform assets.
The Debtors have sought an extension to the bidding deadline,
but, according to AP, the Official Committee of Unsecured
Creditors did not support an extension.
New Century Financial had requested for a "prompt" sale of the
Loan Origination Platform assets through an absolute auction to
avoid further deterioration of the value of the assets. The
Debtors have ceased operation of their loan origination business
but wanted buyers to resume operations of the business.
New Century Financial said that it is considering its
alternatives for the Loan Origination Platform assets.
About New Century
Founded in 1995 and headquartered in Irvine, California, New
Century Financial Corporation (NYSE: NEW) -- http://www.ncen.com/
-- is a real estate investment trust, providing mortgage products
to borrowers nationwide through its operating subsidiaries, New
Century Mortgage Corporation and Home123 Corporation. The company
offers a broad range of mortgage products designed to meet the
needs of all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. When the
Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a chapter 11 plan expires on July 31,
2007. (New Century Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
The Debtors' exclusive period to file a plan expires on July 31,
2007.
NEW CENTURY: To Cut 2,000 Jobs Amid Lack of Bids for Key Assets
---------------------------------------------------------------
New Century Financial Corporation, New Century Mortgage
Corporation, and Home123 Corporation will lay off 2,000
employees, constituting 73% of their workforce in the United
States, as a result of lack of bids to purchase New Century
Financial's loan origination platform assets as a continuing
business.
On April 25, 2007, the U.S. Bankruptcy Court for the District of
Delaware approved the Debtors' request to set bidding procedures
in connection with a potential auction of the loan origination
platform assets. The deadline to submit bids for the assets
expired on May 2, 2007.
No bids, however, were received by the May 2 deadline, Brad A.
Morrice, president and chief executive officer of NCFC, said in a
filing with the Securities and Exchange Commission.
As a result, the Debtors, on May 3, announced the workforce
reductions. "This reduction in workforce is effective May 4,"
Mr. Morris said.
The vast majority of the employees included in this reduction in
workforce were associated with the operations included in the
loan origination platform assets. The company expects to incur
severance pay expenses and make related cash expenditures of
approximately $7,000,000 in connection with the reduction in its
workforce.
About 1,150 of the workers being laid off work in the wholesale
division and about 575 work in the retail, consumer-direct unit.
Another 275 support employees also are being laid off, spokesman
Ron Low said, according to AP.
Only personnel from New Century's loan servicing unit and about
250 members of the corporate team will remain as the bankruptcy
process winds down, Mr. Morrice said.
On April 2, when it sought Chapter 11 protection, New Century
also announced immediate reductions of its workforce by
approximately 3,200, or 54%.
About New Century
Founded in 1995 and headquartered in Irvine, California, New
Century Financial Corporation (NYSE: NEW) -- http://www.ncen.com/
-- is a real estate investment trust, providing mortgage products
to borrowers nationwide through its operating subsidiaries, New
Century Mortgage Corporation and Home123 Corporation. The company
offers a broad range of mortgage products designed to meet the
needs of all borrowers.
The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416). Suzzanne Uhland, Esq., Austin K. Barron, Esq., and Ana
Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors. When the
Debtors filed for bankruptcy, they listed total assets of
$36,276,815 and total debts of $102,503,950. The Debtors'
exclusive period to file a chapter 11 plan expires on July 31,
2007. (New Century Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
The Debtors' exclusive period to file a plan expires on July 31,
2007.
NORTHROP GRUMMAN: Earns $387 Million in Quarter Ended March 31
--------------------------------------------------------------
Northrop Grumman Corporation reported net income of $387 million
for the first quarter ended March 31, 2007, compared with net
income of $358 million for the same period ended March 31, 2006.
Sales for the 2007 first quarter increased 4 percent to
$7.3 billion from $7.1 billion in the 2006 first quarter.
"In the first quarter we increased sales, operating margin and
earnings per share, improved our cash from operations, and
generated robust funded contract acquisitions. All our businesses
continue to perform well," said Ronald D. Sugar, Northrop Grumman
chairman and chief executive officer.
"Although results were slightly impacted by a strike in
Pascagoula, our employees are now back at work building great
ships. With this quarter's sound operating performance and strong
cash from operations, we are well positioned to achieve our 2007
financial targets. Our performance continues to support a
balanced cash deployment strategy, which in the first quarter
included a 23 percent increase in our dividend and a $600 million
accelerated share repurchase, retiring approximately 8 million
shares," Sugar concluded.
Total operating margin for the 2007 first quarter increased 13
percent to $681 million from $604 million for the 2006 first
quarter, reflecting growth in segment sales and margin rate, as
well as lower net pension cost.
Cash provided by operations in the 2007 first quarter totaled
$400 million, an increase of $515 million over the same period a
year ago. The year-over-year improvement includes higher net
collections on programs in progress and less cash expended for
discontinued operations.
First quarter 2007 capital spending totaled $158 million and
included $17 million for Hurricane Katrina damage repair, compared
with capital spending of $173 million in the first quarter of
2006, which included $54 million for Hurricane Katrina damage
repair.
Cash and cash equivalents totaled $362 million at March 31, 2007,
compared with $1 billion at Dec. 31, 2006, principally reflecting
the $578 million acquisition of Essex Corporation in January 2007
and the $600 million accelerated share repurchase agreement
executed in February 2007, partially offset by the effect of
additional borrowings during the quarter. Essex Corp. provides
signal processing services and products, and advanced
optoelectronic imaging for U.S. government intelligence and
defense customers.
Total debt increased to $4.4 billion at March 31, 2007, from
$4.2 billion at Dec. 31, 2006.
At March 31, 2007, the company's balance sheet showed $32 billion
in total assets, $15.7 billion in total liabilities, and
$16.3 billion in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended March 31, 2007, are available for
free at http://researcharchives.com/t/s?1eaa
About Northrop Grumman
Headquartered in Los Angeles, Northrop Grumman Corporation (NYSE:
NOC) -- http://www.northropgrumman.com/--is a $30 billion global
defense and technology company whose 122,000 employees provide
innovative systems, products, and solutions in information and
services, electronics, aerospace and shipbuilding to government
and commercial customers worldwide.
* * *
As reported in the Troubled Company Reporter on May 8, 2007,
Moody's Investors Service placed the debt ratings of Northrop
Grumman Corporation under review for possible upgrade. Among the
debt ratings under review are the company's Multiple Seniority
Shelf, currently at (P)Ba1, and the company's Senior Unsecured
Regular Bond/Debenture, currently at Baa2.
NRG ENERGY: Pursues Refinancing to Support Capital Allocation Plan
------------------------------------------------------------------
NRG Energy Inc. is pursuing a refinancing plan along with
amendments to its senior credit facility to support and facilitate
its capital allocation strategy. The company says this comes as a
result of the successful implementation of its hedging strategy,
and the creation of a strong and stable earnings and cash flow
profile.
Under the planned refinancing, NRG will become a wholly owned
operating company subsidiary of a newly created holding company.
The holding company will borrow up to $1 billion from the Term B
market and pay the net proceeds to the operating company as an
equity contribution. The operating company will use the net
proceeds for the prepayment of a portion of its existing Term B
loan resulting in no change to the company's consolidated debt
levels. Upon completion, the restricted payments capacity under
the company's high yield bond indentures will increase by an
amount equal to the equity contribution from the holding company
to the operating company.
Planned amendments to the senior credit facility include a
reduction in pricing, a $150 million per year carve out enabling a
recurring common share cash dividend, additional flexibility to
invest in Repowering NRG projects, and a commitment from the
lenders to fund the holding company loan. The company has
obtained commitments for the holding company financing from a
number of financial institutions.
Further, in order to provide additional liquidity to the company's
common stock, the company's Board of Directors has approved a
2-for-1 stock split effected in the form of a stock dividend
payable on May 31, 2007. The stock split will entitle each
stockholder of record at the close of business on May 22, 2007, to
receive one additional share for every common share held. The
number of common shares outstanding upon completion of the stock
split will be approximately 242 million shares, excluding the
impact of any additional share repurchases which the company may
complete.
Contingent upon the successful implementation of the holding
company financing, which requires certain regulatory approvals,
and sufficient cash resources the company plans to commence an
annual common share cash dividend of $0.50 per share, paid
quarterly beginning in the first quarter 2008. In addition to the
cash dividend, the company plans to continue with common share
repurchase programs from time to time even after the completion of
the current share buyback.
In light of the company's projected earnings and cash flow
profile, the company plans to target an annual return of capital
to shareholders, consisting of both fixed (dividend) and variable
(share repurchase) components, of approximately 3% per annum. In
connection with the company's previously announced share
repurchase program, $103 million of common share repurchases were
completed during the first quarter 2007 at an average price of
$68.74 per share, leaving $165 million of authorized repurchases
to be completed. The company expects to complete the remaining
share repurchases in 2007.
"The Capital Allocation Plan announced today reflects steadfast
confidence in our business model and our unwavering commitment to
capital discipline," commented Robert C. Flexon, NRG's Executive
Vice President and Chief Financial Officer. "All elements of our
capital allocation philosophy-reinvestment, debt management,
returning capital to shareholders, and RepoweringNRG-are covered
by this plan."
About NRG Energy
Headquartered in Princeton, New Jersey, NRG Energy, Inc. --
http://www.nrgenergy.com/-- owns and operates power generating
facilities, and trades energy, fuel, capacity and related products
primarily in Texas and the northeast, south central and western
regions of the United States. NRG also owns generating facilities
in Australia, Brazil, and Germany.
As of Dec. 31, 2006, NRG owned 24,175 MW of generating capacity
and had about $8.7 billion in debt.
* * *
As reported in the Troubled Company Reporter on May 7, 2007,
Standard & Poor's Ratings Services raised its rating on NRG Energy
Inc.'s $4.7 billion unsecured bonds to 'B' from 'B-' and assigned
its 'B-' rating to the proposed $1 billion delayed-draw term loan
B at NRG Holdings Inc., a newly created holding company that would
own 100% of NRG's equity. In addition, Standard & Poor's affirmed
the 'B+' corporate credit rating on NRG and affirmed the 'BB-'
rating on NRG's $3.148 billion term loan B; the 'CCC+' rating on
the company's preferred stock, and the 'B-2' short-term rating.
The outlook on all ratings is stable.
OHIO CASUALTY: Inks Deal Selling $2.7BB Stake to Liberty Mutual
---------------------------------------------------------------
Ohio Casualty Corporation has entered into a definitive agreement
selling all of the company's outstanding shares of common stock
to Liberty Mutual Group for $44 per share or $2.7 billion in cash.
Liberty Mutual will fund the purchase with cash on hand and short-
term debt; the transaction is not subject to any financing
contingencies. The proposed transaction, approved by the boards
of directors of both companies, is subject to approval by Ohio
Casualty shareholders and customary regulatory approvals and
conditions, and is expected to close in the third quarter of 2007.
Ohio Casualty will be part of Liberty Mutual Group's Agency
Markets business unit, after the acquisition.
"I am proud of the accomplishments of the company's employees,
agents and management at Ohio Casualty in creating a leading
super-regional property and casualty insurance company,
Dan Carmichael, president and chief executive of Ohio Casualty,
said. The company looks forward to being an important component
of Liberty Mutual Agency Markets' continuing success. The company
believes this transaction will benefit the company's key
constituents and enable its shareholders to realize significant
value for their investment in Ohio Casualty."
"Under Dan Carmichael's leadership, Ohio Casualty has been
transformed into a premier regional property and casualty company
and is a great fit with the Agency Markets business," Edmund F.
Kelly, Liberty Mutual Group chairman, president and chief
executive officer, said. "Through the addition of Ohio Casualty,
the company's regional-company independent agency business is
significantly stronger and the company's agency relationships are
strengthened. With combined net written premium exceeding
$7.3 billion following this transaction, the company will become
the largest regional provider of property and casualty products
distributed through independent agents in the United States."
"I look forward to working with Dan and the leadership of Ohio
Casualty, who will play a key role in the joint integration team
tasked with combining the best of both organizations to create a
stronger Liberty Mutual Agency Markets," Gary Gregg, president of
Liberty Mutual Agency Markets, said. The company shares Ohio
Casualty's commitment to employees, customers and agents. The
combined organization intends to maintain a significant presence
in the Cincinnati area and will continue to support local
charities in the communities in which we do business."
About Liberty Mutual Group
Headquartered in Boston, Liberty Mutual Group --
http://www.libertymutual.com-- is a diversified global insurer
and a property and casualty insurer in the United States. The
company also ranks 95th on the Fortune 500 list of largest
corporations in the United States based on 2006 revenue of
$23.5 billion. As of Dec. 31, 2006, Liberty Mutual Group had
$85.5 billion in consolidated assets.
The company employs over 39,000 people in more than 900 offices
throughout the world. The 11 companies in Liberty Mutual Agency
Markets have more than 6,800 employees and approximately 6,500
appointed agencies. In 2006, Liberty Mutual Agency Markets' net
written premium was $5.9 billion.
About Ohio Casualty Corporation
Headquartered in Fairfield, Ohio, Ohio Casualty Corporation (NASD:
OCAS) -- http://www.ocas.com/-- is the holding company of The
Ohio Casualty Insurance Company and five other subsidiary
insurance companies. Founded in 1919, the company has
approximately 2,100 employees in five major locations countrywide,
Ohio Casualty Group is ranked among the top 50 U.S.
property/casualty insurance groups based on net premiums written.
The Group has written premiums of approximately $1.42 billion as
of Dec. 31, 2006. OCG products are marketed through approximately
3,400 independent agencies. The Ohio Casualty Insurance Company,
West American Insurance Company, American Fire and Casualty
Company, Ohio Security Insurance Company, Avomark Insurance
Company or Ohio Casualty of New Jersey Inc. may underwrite
policies.
OHIO CASUALTY: Liberty Mutual Deal Cues Moody's to Review Ratings
-----------------------------------------------------------------
Moody's has placed the debt ratings (senior at Baa3) of Ohio
Casualty Corporation (NASDAQ: OCAS) and the A3 insurance financial
strength ratings of its operating subsidiaries on review for
possible upgrade, following an announcement that Liberty Mutual
Insurance Company has agreed to acquire all outstanding shares of
Ohio Casualty's common stock. OCAS' ratings had been on positive
outlook prior to this rating action. LMIC has an insurance
financial strength rating of A2, a long-term issuer rating of
Baa1, and surplus notes rated Baa2, all with a stable outlook.
Under the terms of the agreement, LMIC will acquire all common
shares of OCAS for $44.00 per share in cash, or $2.7 billion, at
which point LMIC will take OCAS private. LMIC will assume
responsibility for repayment of OCAS' outstanding debt. OCAS will
pay LMIC a termination fee of $62 million under certain
circumstances if the proposed transaction isn't completed.
Moody's review will focus on several items including:
1) Liberty Mutual's plans for incorporating and integrating
OCAS within its organization,
2) additional operational flexibility, if any, provided to
OCAS as a result of this transaction,
3) the resources of LMIC available to OCAS in times of stress,
and
4) the collective credit profile of OCAS and any LMIC
subsidiaries that it is pooled with.
Moody's current ratings on OCAS reflect the group's established
regional presence, particularly in niche markets for contractors;
solid risk-adjusted capitalization due to good reserve strength
and historically modest exposure to peak natural catastrophe
perils; lower debt leverage than similarly-rated peers; and ample
provisions for liquidity. These credit strengths are tempered by
a relatively high expense structure, which makes it difficult for
the company to compete with larger competitors on price alone;
weak product strength in its personal lines offerings; potential
exposure to litigiousness in the construction industry; and
persistently unprofitable workers' compensation business.
The last rating action on OCAS took place on March 7, 2007 when
Moody's assigned provisional ratings to OCAS' unlimited shelf
registration.
These ratings have been placed on review for possible upgrade:
Ohio Casualty Corporation
* senior unsecured debt at Baa3,
* provisional senior unsecured debt at (P)Baa3,
* provisional subordinated debt at (P)Ba1,
* provisional preferred stock at (P)Ba2;
Ohio Casualty Capital Trust I
* provisional preferred securities at (P)Ba1;
Ohio Casualty Capital Trust II
* provisional preferred securities at (P)Ba1;
Ohio Casualty Insurance Company
* insurance financial strength at A3;
Ohio Security Insurance Company
* insurance financial strength at A3;
West American Insurance Company
* insurance financial strength at A3;
American Fire & Casualty Company
* insurance financial strength at A3; and
Avomark Insurance Company
* insurance financial strength at A3.
Ohio Casualty Corporation (NASDAQ: OCAS), based in Fairfield,
Ohio, is engaged through its subsidiaries in property and casualty
insurance, including personal, commercial and specialty commercial
lines. For the first quarter of 2007, OCAS reported net income of
$63 million. As of March 31, 2007, OCAS had shareholders' equity
of approximately $1.6 billion and statutory surplus at its
operating subsidiaries of approximately $1.1 billion.
Liberty Mutual Group Inc., based in Boston, Massachusetts is a
mutual holding company that provides personal and commercial
insurance products both domestically and internationally. On a
GAAP basis, for the first quarter of 2007, the group reported net
income of $350 million on earned premiums of $5.2 billion. As of
March 31, 2007, LMGI reported consolidated GAAP policyholders'
equity of $11.3 billion and total assets of $88.1 billion.
PACIFIC LUMBER: Can Employ Xroads Solutions as Financial Advisor
----------------------------------------------------------------
The United States Bankruptcy Court for the Southern District of
Texas has authorized Pacific Lumber and its debtor-affiliates to
employ Xroads Solutions Group LLC as their financial advisors,
effective as of March 12, 2007.
The Debtors disclosed that they selected XRoads based on the
firm's experience in the bankruptcy field.
As the Debtors' financial advisors, XRoads is expected to:
(a) provide financial and accounting support as needed by the
Debtors to comply with the reporting requirements of third
party constituents and the U.S. Trustee;
(b) assist in the development and review of cash flow
management, forecasting and reporting;
(c) assist the Debtors' accounting and finance departments,
including providing bankruptcy reporting guidance, advice
on improvement of processes and procedures, development of
financial models and business plans and responding to due
diligence requests; and
(d) assist the Debtors' management and professionals with
bankruptcy and restructuring matters, including but not
limited to evaluation and negotiation of executory
contracts, vendor management and claims resolution.
The Debtors will pay XRoads in accordance with the firm's hourly
rates:
Professional Hourly Rate
------------ -----------
Principals $450
Managing Directors, $350
Directors and Consultants $350
The Debtors will also reimburse XRoads for its necessary out-of-
pocket expenses.
Nathaniel Peter Holzer, Esq., at Jordan, Hyden, Womble & Culbreth
& Holzer, P.C., in Corpus Christi, Texas, told the Court that
Xroads has agreed to discount the hourly rate to be charged by
John Young, an XRoads managing director, by more than 25% for the
first 200 hours of work he performs for each calendar month.
Mr. Young's rate will be at $250 per hour, and hours worked in
excess of the 200 hours in each calendar month will be billed at
$300 per hour. Mr. Young's expenses in traveling to or from the
Debtors' offices will not be billed.
Travel expenses spent by other XRoads personnel will be billed at
one-half the hourly rate charged by the applicable person.
XRoads will maintain detailed, contemporaneous records of time
and any necessary expenses incurred in connection with the
contemplated professional services and will separately bill the
PALCO Debtors for services rendered to The Pacific Lumber
Company, Britt Lumber Co., Inc., Salmon Creek LLC and Scotia Inn;
and Scotia Pacific Company LLC for services rendered to Scopac.
Alexander Stevenson, a partner at Xroads, assured the Court that
the firm does not represent interests adverse to the Debtors, and
is a "disinterested person" under Section 101(14) of the
Bankruptcy Code.
About Pacific Lumber
Headquartered in Oakland, California, The Pacific Lumber Company
-- http://www.palco.com/-- and its subsidiaries operate in
several principal areas of the forest products industry,
including the growing and harvesting of redwood and Douglas-fir
timber, the milling of logs into lumber and the manufacture of
lumber into a variety of finished products.
Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber
Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned
subsidiaries of Pacific Lumber.
Scotia Pacific, Pacific Lumber's largest operating subsidiary, was
established in 1993, in conjunction with a securitization
transaction pursuant to which the vast majority of Pacific
Lumber's timberlands were transferred to Scotia Pacific, and
Scotia Pacific issued Timber Collateralized Notes secured by
substantially all of Scotia Pacific's assets, including the
timberlands.
Pacific Lumber, Scotia Pacific, and four other subsidiaries filed
for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case
Nos. 07-20027 through 07-20032). Jeffrey L. Schaffer, Esq.,
William J. Lafferty, Esq., and Gary M. Kaplan, Esq., at Howard
Rice Nemerovski Canady Falk & Rabkin, A Professional Corporation
is Pacific Lumber's lead counsel. Nathaniel Peter Holzer, Esq.,
Harlin C. Womble, Jr. , Esq., and Shelby A. Jordan, Esq., at
Jordan Hyden Womble Culbreth & Holzer PC, is Pacific Lumber's co-
counsel. Kathryn A. Coleman, Esq., and Eric J. Fromme, Esq., at
Gibson, Dunn & Crutcher LLP, acts as Scotia Pacific's lead
counsel. John F. Higgins, Esq., and James Matthew Vaughn, Esq.,
at Porter & Hedges LLP, is Scotia Pacific's co-counsel.
When Pacific Lumber filed for protection from its creditors, it
listed estimated assets and debts of more than $100 million.
Scotia Pacific listed total assets of $932,000,000 and total debts
of $765,978,335. The Debtors' exclusive period to file a chapter
11 plan expires on May 18, 2007. (Scotia/Pacific Lumber
Bankruptcy News, Issue No. 15, http://bankrupt.com/newsstand/or
215/945-7000).
PERSONA COMMUNICATIONS: Bragg Deal Cues S&P's Developing Watch
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
the 'B' long-term corporate credit rating, on Newfoundland-based
cable TV operator Persona Communications Corp. on CreditWatch with
developing implications following the announcement by Halifax-
based privately held cable TV provider Bragg Communications Inc.
that it had entered into a purchase and sale agreement with the
current owners of Persona to acquire the company. The transaction
requires regulatory approvals, including approval from the
Canadian Radio-television and Telecommunications Commission, for
the transfer of Persona's broadcast licenses. Details of the
transactions are undisclosed.
"The CreditWatch placement is due to the fact that Bragg is a
private unrated company," said Standard & Poor's credit analyst
Madhav Hari. "Persona's bank loan agreements governing its
$230 million first lien bank credit facilities and the
$130 million second lien bank credit facility state change of
control as an event of default. It is S&P's current understanding
that these facilities will be redeemed upon close of the
acquisition. If the company is taken private, the ratings could
be withdrawn without resolving the CreditWatch."
PETER HANSEN: Case Summary & Largest Unsecured Creditor
-------------------------------------------------------
Debtor: Peter Thomas Hansen
dba OSA Development, Inc.
P.O. Box 2756
Mount Vernon, WA 98273
Bankruptcy Case No.: 07-12018
Chapter 11 Petition Date: May 4, 2007
Court: Western District of Washington (Seattle)
Judge: Samuel J. Steiner
Debtor's Counsel: Steven C. Hathaway, Esq.
115 West Magnolia, Suite 211
P.O. Box 2147
Bellingham, WA 98227-2147
Tel: (360) 676-0529
Total Assets: $5,320,695
Total Debts: $2,650,000
Debtor's Largest Unsecured Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
The James Co. 7115 Birch Bay $2,000,000
114 West Magnolia, Suite 419 Drive
Bellingham, WA 98225 Blaine, WA
98230; value of
security:
$1,300,000;
value of senior
lien: $650,000
PILGRIM'S PRIDE: Incurs $40 Mil. Net Loss in Second Quarter 2007
----------------------------------------------------------------
Pilgrim's Pride Corporation reported a net loss of $40.1 million
on total sales of $2 billion for the second quarter ended
March 31, 2007. For the second quarter of fiscal 2006, the
company reported a net loss of $32 million on total sales of
$1.27 billion.
Results for the second quarter of 2007 include, for the first
time, the acquisition of Gold Kist Inc., which was completed
Dec. 27, 2006. The results also include charges of $14.5 million,
$9.1 million, net of tax, related to the early extinguishment of
debt incurred by the company in connection with the financing for
the acquisition.
"Our financial performance in the second quarter of fiscal 2007
reflects some of the significant operating challenges faced by
U.S. chicken processors during that period," said O.B. Goolsby,
Jr., Pilgrim's Pride president and chief executive officer.
"Feed-ingredient prices remain at very high levels amid rapidly
growing demand for corn-based ethanol. While we have succeeded in
passing along some of these higher costs to our customers this
year, most of the benefit from those price increases was not fully
realized in the second quarter. Additionally, we are continuing
to address pricing opportunities in a number of below-market
customer contracts we acquired through the Gold Kist transaction."
Mr. Goolsby noted, however, that the company's U.S. operations
returned to profitability late in the second quarter -- and the
Company is currently profitable in the third quarter -- as
production cutbacks in the United States helped strike a better
balance between production and demand. In addition, U.S. market
prices for chicken products have strengthened heading into the
summer as well. Mr. Goolsby also said the company's Mexico
operations have returned to profitability in the third quarter to
date. He said current U.S. production at Pilgrim's Pride is "in
line" with the company's previously announced 5% reduction target
when compared to year-ago levels. The cuts will stay in place
throughout the third quarter of fiscal 2007 before leveling off in
the fourth quarter, when the company cycles through the first
anniversary of its production cutback from last summer.
"We are cautiously optimistic about the second half of the fiscal
year. We believe that the combination of lower industry
production levels year-over-year, should they remain in place, and
stronger pricing heading into the summer months will lead to
continuing improvement in our financial results for the remainder
of the year," Mr. Goolsby said. "On the Gold Kist integration
front, our employees are investing a lot of time and effort in the
integration, and I'm excited by the tremendous opportunities they
have uncovered for improving our combined businesses. They are
clearly focused on our common goal of delivering the best possible
service and value to our customers every day and are making good
progress toward achieving our previously announced estimate of
$100 million in synergy savings."
For the six months ended March 31, 2007, the company reported a
net loss of $48.8 million on total sales of $3.3 billion. For the
first six months of fiscal 2006, Pilgrim's Pride reported a net
loss of $6.3 million on sales of $2.61 billion. Included in the
2007 six-month period results were charges of $14.5 million,
$9.1 million, net of tax, related to the early extinguishment of
debt incurred by the company in connection with the financing for
the Gold Kist acquisition.
As of March 31, 2007, the company's balance sheet showed total
assets of $4.1 billion, total liabilities of $3 billion, and
minority interest of $2 million, resulting in a total
stockholders' equity of $1.1 billion.
Full-text copies of the company's 2007 second quarter report are
available for free at http://ResearchArchives.com/t/s?1ea2
About Pilgrim's Pride
Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation
(NYSE: PPC) -- http://www.pilgrimspride.com/-- produces,
distributes and markets poultry processed products through
retailers, foodservice distributors and restaurants in the U.S.,
Mexico and in Puerto Rico. Pilgrim's Pride employs about 40,000
people and has major operations in Texas, Alabama, Arkansas,
Georgia, Kentucky, Louisiana, North Carolina, Pennsylvania,
Tennessee, Virginia, West Virginia, Mexico and Puerto Rico, with
other facilities in Arizona, Florida, Iowa, Mississippi and Utah.
* * *
Pilgrim's Pride Corp. carries Moody's Investors Service's B1
senior unsecured credit rating, B2 senior subordinated notes, and
Ba3 corporate family ratings. PPC's planned new $250 million
senior unsecured notes also bears Moody's B1 rating and its new
$200 million senior subordinated notes bears Moody's B2 rating.
The outlook on all ratings is stable.
Standard & Poor's Ratings Services gave Pilgrim's Pride Corp. a
'BB-' corporate credit rating.
POPULAR INC: Fitch Lowers Individual Rating to B/C
--------------------------------------------------
Fitch Ratings has downgraded these ratings of Popular, Inc.:
-- Long-term Issuer Default Rating to 'A-' from 'A';
-- Senior unsecured to 'A-' from 'A';
-- Preferred stock to 'BBB+ from 'A-';
-- Individual to 'B/C' from 'B'.
Fitch has revised the Rating Outlook to Stable from Negative and
affirmed the Short-Term Rating at 'F1'.
The downgrade reflects continued pressure on core profitability
and asset quality. In 2006, Popular's net profits were pressured
by lower operating results combined with restructuring charges.
Operating results diminished as a consequence of net interest
margin pressure and higher loan loss provisions. Popular recorded
restructuring charges in the fourth quarter of 2006 following its
decisions to exit the wholesale subprime mortgage origination
business and consolidate support functions in its mainland-U.S.
operations. In the first quarter of 2007, Popular's results
benefited from gains from the sale of Popular's stake in
Telecomunicaciones de Puerto Rico. This gain more than offset
charges for residual interests associated with mortgage
securitizations, valuation adjustments on mortgages held for sale,
and additional restructuring charges.
Popular's non-performing asset ratio increased in 2006 and in the
first quarter of 2007. Its level of NPAs remained higher-than-
average among major U.S. banks. The bulk of NPA growth in recent
periods emanated from higher subprime mortgage delinquencies on
the mainland U.S. combined with growing problems in Puerto Rico
(reflecting a more difficult local economy). While certainly a
concern, Popular's subprime exposure appears manageable. Its
diversified operations give it greater flexibility to absorb
subprime losses. W hile Popular's Tier I ratio remains better-
than-average among major U.S. banks, Fitch views Popular's higher
capital ratios as appropriate due to greater-than-average credit
risk and its relatively lower earnings performance.
Popular's ratings are supported by its leading position in Puerto
Rico, diverse business mix, and sound overall financial condition.
The Stable rating outlook incorporates a stabilization of earnings
and asset quality measures in future periods and the maintenance
of solid capitalization.
These ratings have been downgraded with a Stable Outlook:
Popular North America, Inc.
-- Long-term IDR to 'A-' from 'A';
-- Senior unsecured to 'A-' from 'A';
-- Individual to 'B/C' from 'B'.
Banco Popular de Puerto Rico
-- Long-term IDR to 'A-' from 'A';
-- Long-term deposits to 'A' from 'A+';
-- Individual to 'B/C' from 'B'.
Banco Popular North America
-- Long-term IDR to 'A-' from 'A';
-- Long-term deposits to 'A' from 'A+';
-- Individual to 'B/C' from 'B'.
BanPonce Trust I
-- Trust preferred to 'BBB+' from 'A-'.
Popular Capital Trust I
-- Trust preferred to 'BBB+' from 'A-'.
Popular Capital Trust II
-- Trust preferred to 'BBB+' from 'A-'.
Popular North America Capital Trust I
-- Trust preferred to 'BBB+' from 'A-'.
These ratings have been affirmed with a Stable Outlook:
Popular, Inc.
-- Support at '5'.
Popular North America, Inc.
-- Short-term Issuer at 'F1';
-- Support at '5'.
Banco Popular de Puerto Rico
-- Short-term Issuer at 'F1';
-- Short-term Deposits at 'F1';
-- Support at '4';
-- Support Floor at 'B'.
Banco Popular North America
-- Short-term Issuer at 'F1';
-- Short-term Deposits at 'F1';
-- Support at '5'.
QUIKSILVER INC: Weak Credit Measures Cue S&P to Cut Rating to BB-
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on global lifestyle apparel marketer and designer
Quiksilver Inc., to 'BB-' from 'BB'. At the same time,
Standard & Poor's lowered the rating on the Huntington Beach,
California-based company's $400 million senior unsecured notes due
2015, to 'B+' from 'BB-'. All ratings were removed from
CreditWatch with negative implications, where they were placed on
March 12, 2007, following the company's announcement of much-
weaker-than-expected operating results for the first quarter ended
January 2007, and the resulting downward guidance revision. The
outlook is negative.
"The rating actions reflect Quicksilver's weakened credit
measures," said Standard & Poor's credit analyst Susan Ding, "and
our uncertainty regarding the company's ability to improve
operating performance and restore credit measures to levels that
are in line with the former 'BB' rating, given current challenges
facing the company."
Poor first quarter results were driven primarily by a very weak
snow season that negatively impacted operating results in the
company's Rossignol ski business, which accounted for about 20% of
the company's total revenues. Because of the exceptionally warm
winter, in-season sales were well below the company's expected
levels. Reorders for the next snow season are expected to be
lower as well. As a result, there was some inventory build-up,
which will require liquidation at lower margins. "We expect this
will impact financial measures in the next several quarters," said
Ms. Ding.
R&G FINANCIAL: Financial Filing Delay Cues Moody's to Cut Ratings
-----------------------------------------------------------------
Fitch Ratings downgraded the long-term issuer default rating of
R&G Financial Corporation to 'BB-' from 'BB'.
This downgrade reflects a longer-than-expected delay in releasing
its audited financials, regulatory and legal issues, deteriorating
operating results in 2006 and ongoing concerns regarding the mix
and level of capitalization. The Rating Outlook remains Negative.
A complete list of ratings follows this release.
R&G is lagging its Puerto Rican peers in the resolution of its
accounting issues. In late March 2007, R&G announced that it will
not file its 2004 10-K/A in 1Q07 as previously expected.
Reports for subsequent years will not be filed until after the
2004 10-K/A. R&G reports that it has made substantial progress on
the restatement process, but continues to not express a view
regarding the completion of this process. In the aftermath of its
accounting and regulatory issues, new management is in place,
including a new CEO and CFO, among others.
In 2006, R&G reported after-tax losses (based on its regulatory
filings) versus profits in the prior year. Performance was
hampered by NIM pressure, lower non-interest income, and
accounting and legal costs. Capital ratios declined substantially
in 2006, following estimated accounting restatement charges and
the unwinding of its mortgage sales. Capital ratios still exceed
regulatory minimums, but high portions of trust preferred
securities and preferred stock are in the capital structure.
Unless R&G is able to issue additional common equity, its capital
position will likely remain comparatively weak.
Resolution of the Negative Rating Outlook will be driven by the
following factors: the establishment of timely audited financial
statements, resolution of regulatory issues, as well as greater
clarity regarding the potential negative impact of an SEC
investigation and shareholder class action suit. Furthermore, a
stabilization of operating performance and an improvement in the
level and mix of capitalization would have to be attained.
Fitch downgrades these ratings with a Negative Outlook:
R&G Financial Corporation
-- Long-term IDR to 'BB-' from 'BB';
-- Preferred stock to 'B-' from 'B'.
R-G Premier Bank
-- Long-term IDR to 'BB-' from 'BB';
-- Long-term deposits to 'BB' from 'BB+';
-- Individual to 'D' from 'C/D'.
R-G Crown Bank
-- Long-term IDR to 'BB-' from 'BB';
-- Long-term deposits to 'BB' from 'BB+';
-- Individual to 'D' from 'C/D'.
R&G Mortgage
-- Long-term IDR to 'BB-' from 'BB'.
Fitch affirms these ratings:
R&G Financial Corporation
-- Individual at 'D';
-- Support at '5'.
R-G Premier Bank
-- Short-term Issuer at 'B';
-- Short-term Deposits at 'B';
-- Support at '5'.
R-G Crown Bank
-- Short-term Issuer at 'B';
-- Short-term Deposits at 'B';
-- Support at '5'.
RHODES COMPANIES: High Debt Leverage Cues Moody's to Cut Ratings
----------------------------------------------------------------
Moody's Investors Service lowered the ratings of The Rhodes
Companies, LLC, including the:
* corporate family rating to B2 from B1,
* probability-of-default rating to B2 from B1,
* rating on the senior secured first-lien term loan to B2 from
B1, and
* rating on the senior secured second-lien term loan to Caa1
from B3.
The Loss-Given-Default assessment and rate on the first-lien term
loan changed to LGD 3, 43% from LGD 3, 44%, and on the second-lien
term loan changed to LGD 6, 92% from LGD 6, 93%. The company's
outlook was revised to negative from stable.
The downgrade was triggered by the company's significant financial
underperformance during the 4th quarter of 2006 compared with
prior Moody's expectations, by the continued weakness of the Las
Vegas residential housing market, and by the company's need to
request amendments to its existing credit agreement in order to
comply with its financial covenants.
The ratings reflect the company's high debt leverage, relatively
small size and scale, limited geographic reach and product
diversity, oversupply of inventory in the Las Vegas housing
market, and the cyclical nature of the homebuilding and land
development industries. At the same time, the ratings recognize
the significant collateral in the structure (as represented by a
recent Cushman & Wakefield undiscounted asset appraisal of $1.326
billion), the low cost basis of the majority of its owned land,
the ongoing long-term strength of the Las Vegas housing market,
the company's reasonably strong historical track record, and the
considerable infrastructure spending completed to date in the
Rhodes Homes' master planned communities.
The negative outlook reflects Moody's expectation that:
1) weakness in the Las Vegas residential housing market will
continue through at least 2008,
2) that Rhodes will see a narrowing of the headroom being
built in to the proposed new financial covenants, and
3) although Rhodes will maintain generally level collateral
coverage throughout 2007 and 2008, the company will not
begin to significantly reduce debt/total net value until
the end of 2009, which is well beyond its original
projections.
The ratings and outlook could be stressed further by a significant
narrowing of the current headroom under the company's financial
covenants, especially interest coverage, a material increase in
debt leverage, or use of the estimated $95 million current cash
balances for anything other than seasonal working capital needs
and/or additional land purchases that would be added to the
collateral package. Going forward, the ratings and outlook could
be stabilized by the company's building additional headroom in its
financial covenants, particularly interest coverage; by a
significant build-up in its equity base; by successful
diversification into the Golden Valley, AZ market; and by a
permanent reduction in the company's debt leverage metrics.
Headquartered in Las Vegas, Nevada, The Rhodes Companies, LLC and
its co-borrowers (Heritage Land Company, LLC and Rhodes Ranch
General Partnership) comprise the largest private community
developer and homebuilder in Las Vegas. Revenues and net income
(essentially pretax income, since the company pays no income
taxes) for the year ended December 31, 2006 were $337.6 million
and $69.3 million, respectively.
RICHARD YOCK: Case Summary & 12 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Richard Mearl Yock
5290 North Lake Drive
Whitefish Bay, WI 53217
Bankruptcy Case No.: 07-71105
Chapter 11 Petition Date: May 4, 2007
Court: Northern District of Illinois (Rockford)
Judge: Manuel Barbosa
Debtor's Counsel: Stephen G Balsley, Esq.
Barrick, Switzer, Long, Balsley & Van Evera
6833 Stalter Drive
Rockford, IL 61108
Tel: (815) 962-6611
Total Assets: $5,490,703
Total Debts: $3,414,495
Debtor's 12 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Etta Pullen residential $87,000
71 County Road 533 condominium
Poplar Bluff, MO 63901 located at
5958 Allerton
Drive,
Rockford, IL
61114; value
of security:
$100,000;
value of
senior lien:
$49,500
Visa-Citi Cards business $31,887
P.O. Box 6000 operating
The Lakes, NV 89163-6000 expenses
$33,137
Bank of America business $21,070
P.O. Box 15026 operating
Wilmington, DE 19850-5026 expenses
Whitehead Realtors commission for $12,000
lease
Mastercard-GM Business Card business $9,034
operating
expenses
American Express business $7,390
operating
expenses
Mastercard/A.T.&T. Universal business $5,969
Card operating
expenses
May Griggs loan for $5,000
business
operating capital
Bank of America $4,720
City of Industry, CA
G&O Landscaping, Inc. M. Ann Karlberg $4,460
snow plowing at
rental
properties
Norstar Heating & Cooling M. Ann Karlberg $3,637
mechanical
services at
rental properties
Chase/Visa (Priority Club) $1,600
SAFENET INC: High Debt Leverage Prompts Moody's B2 Rating
---------------------------------------------------------
Moody's Investors Service assigned a B2 corporate family rating to
SafeNet, Inc. and also assigned ratings to the credit facilities
to be used to finance the acquisition of SafeNet by the private
equity firm Vector Capital.
The first lien credit facilities were assigned a B1 rating and the
second lien term loan was assigned a Caa1 rating. The outlook is
negative, which reflects the overhang due to SEC/DOJ
investigations, pending class action litigation, accounting
restatements, material weakness of internal controls for financial
reporting, and unaudited historical financial statements.
The B2 corporate family rating reflects SafeNet's very high debt
leverage relative to its small business scale (total revenue of
$291 million, with pro forma debt/adjusted EBITDA of 6.6 times),
as well as its significant customer concentration, declining
EBITDA margins, and its modest but significant acquisition
appetite. SafeNet's good market position in niche product
segments supports the rating, as do the relatively high barriers
to entry in the classified government business due to the Type 1
certification required for this business. Further, SafeNet has
established long-term relationships with government agencies as a
trusted provider of security products, which has enabled it to
secure a $400 million IDIQ contract from the Department of
Defense. SafeNet also has a somewhat diversified product
portfolio that spans several industries and end markets.
These ratings were assigned:
* Corporate family rating: B2
* Probability of default rating: B2
* $25 million 6-year First lien Revolving Credit Facility:
B1, LGD3, 32%
* $250 million 7-year First Lien Senior Secured Term Loan:
B1, LGD3, 32%
$125 million 8-year Second Lien Senior Secured Term Loan: Caa1,
LGD5, 84%
The outlook could change to stable if the company files its
audited financial statements and resolves its pending SEC/DOJ
investigation without material impact to the company's financial
profile, and modestly grows revenues and EBITDA.
The ratings could see downward pressure if the company:
1) experiences no growth or declines in revenues and EBITDA;
and
2) engages in sizable debt-financed acquisitions.
With revenues of $291 million for the twelve months ended March
31, 2007, SafeNet Inc, which is headquartered in Belcamp,
Maryland, is a provider of network security solutions to
government, financial institutions, and global enterprises.
SCOTTISH RE: MssMutual Deal Completion Cues A.M Best to Up Ratings
------------------------------------------------------------------
A.M. Best Co. has upgraded the financial strength rating to B+
(Good) from B (Fair) and the issuer credit ratings to "bbb-" from
"bb+" for the primary operating insurance subsidiaries of Scottish
Re Group Limited (Cayman Islands) [NYSE: SCT].
A.M. Best has also upgraded the ICR to "bb-" from "b" and the
various debt ratings of Scottish Re.
All ratings have been removed from under review with positive
implications and assigned a stable outlook.
These rating actions follow the completion of the previously
announced agreement in which MassMutual Capital Partners, LLC and
Cerberus Capital Management, LP each would invest $300 million
into Scottish Re. Under the agreement, Scottish Re will issue
convertible preferred shares, which is the equivalent of a 68.7%
ownership interest in the company. The capital investment is
permanent and enables Scottish Re to meet both its short-term and
longer-term capital and cash flow needs.
A.M. Best notes the support demonstrated by its new ownership and
expects financial and risk management controls will improve as a
result of this change. Capital levels at the insurance entities
currently support a "Secure" rating.
However, Scottish Re recorded a substantial loss in 2006 on both a
statutory and GAAP basis. Moreover, A.M. Best expects that
improvement in earnings may be slow to emerge in the near term, as
costs related to operational and corporate governance measures are
incurred. In addition, rebuilding its brand in the reinsurance
market will likely take time. The generation of new business has
been negatively impacted by rating downgrades and Scottish Re's
financial difficulties, and retention of current treaties will
need to be monitored. Operating leverage also remains at a high
level.
The stable outlook reflects A.M. Best's opinion that Scottish Re
will benefit from the discipline from its new Board of Directors
and the stability provided by its investors. A.M. Best will
closely monitor the profit emergence of its inforce business as
well as the ability to generate new business profitably.
The FSR has been upgraded to B+ (Good) from B (Fair) and the ICRs
to "bbb-" from "bb+" for the following subsidiaries of Scottish Re
Group Limited:
* Scottish Annuity & Life Insurance Company (Cayman) Ltd.
* Scottish Re (U.S.), Inc.
* Scottish Re Life Corporation
* Scottish Re Limited
* Orkney Re, Inc.
The ICR has been upgraded to "bb-" from "b" for Scottish Re Group
Limited.
These debt ratings have been upgraded:
Scottish Re Group Limited-
* to "b" from "ccc+" on $125 million non-cumulative preferred
shares
Stingray Pass-thru Trust-
* to "bbb-" from "bb" on $325 million 5.902% senior secured
pass-thru certificates, due 2012
These indicative ratings for debt securities have been upgraded:
Scottish Re Group Limited-
* to "bb-" from "b" on senior unsecured debt
* to "b+" from "b-" on subordinated debt
* to "b" from "ccc+" on preferred stock
* Scottish Holdings Statutory Trust II and III-to "b+" from
"b-" on preferred securities
Founded in 1899, A.M. Best Company is a full-service credit rating
organization dedicated to serving the financial services
industries, including the banking and insurance sectors.
SEA CONTAINERS: Wants Court to Set July 16 as Claims Bar Date
-------------------------------------------------------------
Sea Containers Ltd. and its debtor-affiliates ask the Honorable
Kevin J. Carey of the U.S. Bankruptcy Court for the District of
Delaware to establish July 16, 2007, 5:30 p.m., as the deadline
for all persons and entities holding or wishing to assert a claim
against any of the Debtors to file a proof of claim in these
Chapter 11 cases.
In the event a Debtor rejects an executory contract or unexpired
lease pursuant to Section 365 of the Bankruptcy Code, the Debtors
anticipate that a claim may be asserted in connection with that
rejection. Accordingly, the Debtors propose that the bar date
for filing any proof of claim relating to their rejection of an
executory contract or unexpired lease pursuant to a Court order
entered prior to the applicable Debtor's plan of reorganization
will be the later of:
(i) the general bar date; or
(ii) 30 calendar days after the effective date of that Court
order, unless otherwise provided.
Persons or entities who need not file proofs of claim include:
* any person or entity that already has filed a signed proof
of claim against the applicable Debtor with either BASIC or
the Clerk of the Bankruptcy Court for the District of
Delaware in a form substantially similar to Official
Bankruptcy Form No. 10;
* any person or entity who does not dispute its Claim as
listed on the Debtors' Schedules of Assets and Liabilities;
* any holder of a claim that previously has been allowed by a
Court order;
* any holder of a claim that has been paid in full by any of
the Debtors in accordance with the Bankruptcy Code or a
Court order;
* any holder of a claim for which a specific deadline
previously has been by the Court;
* any Debtor asserting a claim against another Debtor;
* any direct or indirect non-debtor wholly-owned subsidiary of
a Debtor asserting a claim against a Debtor;
* any holder of a claim allowable under Section 503(b) and
507(a)(2) as an expense of administration;
* any professional retained by the Debtors or Court-approved
Committees who asserts administrative claims for fees and
expenses;
* any current officer or director of any Debtor asserting
indemnification, contribution or reimbursement claims;
* any holder of a claim arising with respect to any of
these issuances of Sea Containers Ltd. public notes:
-- 10 3/4% notes due October 15, 2006,
-- 7 7/8% notes due February 15, 2008,
-- 12 1/2% notes due December 1, 2009,
-- 10 1/2% notes due May 15, 2012;
* any individual participant in the Sea Containers 1983 and
1990 Pension Schemes asserting a claim arising under or in
respect of those pension plans; and
* any holder of equity securities of, or other interests in,
the Debtors solely with respect to that holder's ownership
interest in or possession of those equity securities or
other interests.
About Sea Containers
Based in Hamilton, Bermuda, Sea Containers Ltd. --
http://www.seacontainers.com/-- provides passenger and freight
transport and marine container leasing. Registered in Bermuda,
the company has regional operating offices in London, Genoa, New
York, Rio de Janeiro, Sydney, and Singapore. The company is
owned almost entirely by United States shareholders and its
primary listing is on the New York Stock Exchange (SCRA and
SCRB) since 1974. On Oct. 3, the company's common shares and
senior notes were suspended from trading on the NYSE and NYSE
Arca after the company's failure to file its 2005 annual report
on Form 10-K and its quarterly reports on Form 10-Q during 2006
with the U.S. Securities and Exchange Commission.
Through its GNER subsidiary, Sea Containers Passenger Transport
operates Britain's fastest railway, the Great North Eastern
Railway, linking England and Scotland. It also conducts ferry
operations, serving Finland and Estonia as well as a commuter
service between New York and New Jersey in the U.S.
Sea Containers Ltd. and two subsidiaries filed for chapter 11
protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156).
Edmon L. Morton, Esq., Edwin J. Harron, Esq., Robert S. Brady,
Esq., Sean Matthew Beach, Esq., and Sean T. Greecher, Esq., at
Young, Conaway, Stargatt & Taylor, represent the Debtors in their
restructuring efforts.
The Official Committee of Unsecured Creditors and the Financial
Members Sub-Committee of the Official Committee of Unsecured
Creditors of Sea Containers Ltd. is represented by William H.
Sudell, Jr., Esq., and Thomas F. Driscoll, Esq., at Morris,
Nichols, Arsht & Tunnell LLP. Sea Containers Services, Ltd.'s
Official Committee of Unsecured Creditors is represented by
attorneys at Willkie Farr & Gallagher LLP.
In its schedules filed with the Court, Sea Containers Ltd.
disclosed total assets of $62,400,718 and total liabilities of
$1,545,384,083. (Sea Containers Bankruptcy News, Issue No. 14;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
The Debtors' exclusive period to file a chapter 11 plan of
reorganization expires on June 12, 2007.
SIGNAL SECURITIZATION: Fitch Holds Rating on 1998-2 Class A Certs.
------------------------------------------------------------------
Fitch Ratings has taken rating action on these Signal
Securitization Corporation manufactured housing transactions:
Series 1997-3
-- Class A upgraded to 'AAA' from 'AA+';
-- Class B affirmed at 'BB'.
Series 1998-1
-- Class A upgraded to 'AA-' from 'A'.
Series 1998-2
-- Class A affirmed at 'BB-'.
The upgrades, affecting approximately $14.5 million of the
outstanding certificates, reflect an improved relationship between
credit enhancement and expected loss. The affirmations, affecting
approximately $17.8 million of the outstanding certificates,
reflect a stable relationship between credit enhancement and
expected loss.
The collateral of the above transactions consists of fixed-rate
manufactured housing contracts. Signal Bank, N.A purchased the
manufactured housing contracts through Mobile Consultants, Inc.,
who originated and sub-serviced manufactured housing contracts for
Signal Bank and a group of twenty-five other lenders. In the
manufactured housing business for over twenty years, MCI was
acquired by Signal Bank's parent, First Federal Savings Financial
Services, in April 1996. In December 2003, Vanderbilt Mortgage
and Finance, a subsidiary of Clayton Homes Inc., assumed the
servicing responsibilities for the Signal portfolio.
As of the April 2007 distribution date, series 1997-3 has a pool
factor (i.e., current mortgage loans outstanding as a percentage
of the initial pool) of 29% and is seasoned 116 months. Series
1998-1 has a pool factor of 26% and is seasoned 111 months.
Series 1998-2 has a pool factor of 35% and is seasoned 108 months.
SONIC CORP: Feb. 27 Balance Sheet Upside-Down by $26 Million
------------------------------------------------------------
Sonic Corp. reported financial results for the second quarter
and first half of fiscal 2007, which ended Feb. 28, 2007.
At Feb. 28, 2007, the company's balance sheet showed total assets
of $719 million and total liabilities of $745 million, resulting
in a $26 million stockholders' deficit.
Net income totaled $6.2 million versus $12.9 million last year.
Net income totaled $21.5 million versus $29.3 million in the
first half of 2006.
"Second quarter results reflected continued strength in our
business and operating results, especially considering the harsh
weather conditions we encountered across many of our markets,"
Clifford Hudson, Chairman, Chief Executive Officer and
President, said. "Despite the weather's impact in January, which
restrained overall same-store sales growth for the quarter and
temporarily delayed some drive-in openings, it was good to see
same-store sales above the upper end of our 2% to 4% long-term
target range in December and February. We are encouraged by the
continuation of this positive trend in March."
Sonic's revenues for the second fiscal quarter rose 8% to
$161.5 million from $148.9 million in the year-earlier period,
with the year-over-year increase reflecting higher same-store
sales, new unit growth, higher franchising income related to new
drive-in development, and the benefit of the recent acquisition
of eight franchise drive-ins effective Jan. 1, 2007. Revenues
for the first half of 2007 increased 9% to $336.2 million from
$308.7 million in the same period last year.
During the second quarter, Sonic opened 29 new drive-ins,
including 22 franchise drive-ins, compared with a total of 33 in
the year-earlier period, which included 26 by franchisees.
Through the first half of the year, the total number of drive-in
openings was 66, equal to the number opened during the year-
earlier period. Sonic anticipates opening a total of 180-190
new drive-ins in fiscal 2007, including approximately 150-160 by
franchisees.
In the second quarter, the company continued to implement its
new retrofit program, which Sonic began testing in 2003.
Testing and the final determination of prototype elements were
completed late last summer. Through the first half of fiscal
2007, Sonic retrofitted 54 partner drive-ins, including 41 in
the second quarter. The company also extended the rollout of
this program to its franchisees, who completed the retrofit of
five drive-ins during the second quarter. The reception of
Sonic's new look by customers and franchisees has been very
encouraging, providing momentum for this multi-year retrofit
program. The company plans to retrofit a total of 150 partner
drive-ins this fiscal year, along with 250 to 300 franchise
drive-ins.
The company noted that it recently has offered franchisees the
option of converting to a newer form of license agreement that
will extend the franchisees' license agreement term for 20 years
from the date of conversion. The new agreement went into
effect on April 1, 2007. Based upon the initial indications of
intent to convert, the company expects incremental franchise
royalty income of more than $1 million in the second half of
fiscal 2007 and an additional $1.5 million to $2 million
in fiscal 2008.
Headquartered in Oklahoma City, Oklahoma, Sonic Corp. (Nasdaq:
SONC) -- http://www.sonicdrivein.com/-- is America's Drive-In.
It originally started as a hamburger and root beer stand in 1953
in Shawnee, Oklahoma, called Top Hat Drive-In, and then changed
its name to Sonic in 1959. The first drive-in to adopt the Sonic
name is still serving customers in Stillwater, Oklahoma. Sonic
has more than 3,200 drive-ins coast to coast and in Mexico, where
more than a million customers eat every day.
SPECTRX INC: Eisner LLP Raises Going Concern Doubt
--------------------------------------------------
Eisner LLP, in New York, expressed substantial doubt about SpectRx
Inc.'s ability to continue as a going concern after auditing the
company's consolidated financial statements for the year ended
Dec. 31, 2006. The auditing firm pointed to the company's
recurring losses, negative working capital position and capital
deficit. The auditing firm also cited that the company is in
default on payments due under its settlement with Abbott
Laboratories Inc. regarding its redeemable preferred stock
agreement.
SpectRx Inc. reported a net loss of $4.9 million on sales of
$977,000 for the year ended Dec. 31, 2006, compared with a net
loss of $2.2 million on sales of $983,000 for the year ended
Dec. 31, 2005.
At Dec. 31, 2006, the company's balance sheet showed $1.2 million
in total assets and $12.6 million in total liabilities, resulting
in an $11.3 million total stockholders' deficit.
The company's balance sheet at Dec. 31, 2006, also showed strained
liquidity with $1.2 million in total current assets available to
pay $10.7 million in total current liabilities.
Full-text copies of the company's consolidated financial
statements for the year ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?1e9e
SpectRx Inc. (OTCBB: SPRXE.OB) -- http://www.spectrx.com/-- is a
medical technology company providing innovative detection,
monitoring and treatment solutions for the diabetes and cancer
markets.
STRATOS GLOBAL: Pending CIP Deal Cues Moody's to Hold Ratings
-------------------------------------------------------------
Moody's Investors Service confirmed Stratos Global Corporation's
B1 corporate family, Ba2 senior secured and B3 senior unsecured
ratings and lowered the company's speculative grade liquidity
rating to SGL-4 from SGL-3. The outlook is negative. The long
term ratings reflect a B1 probability of default and loss-given
default assessments of LGD 2, 24% on the senior secured debt and
LGD 5, 77% on the senior unsecured notes.
The rating action follows Moody's review of the pending
transaction in which CIP Canada Investment Inc plans to acquire
Stratos with indirect funding from a subsidiary of Inmarsat plc.
Inmarsat will have a call option to acquire Stratos from CIP
Canada beginning in April 2009, prior to which time Stratos will
be controlled by an independent trust and expected to retain its
existing debt capital structure.
The ratings confirmation reflects Moody's belief that Inmarsat
(Ba2/ Negative) is likely to exercise its call option once it is
able to do so in 2009 and that Stratos' operating prospects and
debt capital is unlikely to be negatively impacted by the
transaction in the interim period. The rating also considers the
reduction in risk associated with the renewal of the distribution
agreement in 2009 and Moody's expectation that Stratos is likely
to improve its cash flow generation through the next couple of
years, which may reduce its adjusted leverage ratio towards 4.3x
by the end of 2008 and produce free cash flow to adjusted debt of
roughly 3% in that year.
The negative outlook considers Moody's view that Stratos' key
credit metrics position the company weakly within the B1 rating
category and risks exist to the continued improvement in operating
performance required to sustain the current rating. Specifically,
while the intensely competitive pricing environment which
persisted through much of 2005 and the first half of 2006 has
shown signs of stabilizing, the potential for future results to
again become volatile remains possible, in Moody's opinion. Should
a shortfall to Moody's current expectations occur, Stratos' rating
is likely to be lowered. Additionally, the negative outlook and
SGL-4 liquidity rating signal Moody's view that Stratos' liquidity
is weak. While the company has sufficient cash and operating
lines to cover modest expected cash consumption through the next
year, Moody's believes there is an elevated possibility that the
company will not be able to maintain compliance with financial
maintenance covenants through the 12 month horizon of the SGL
rating.
Downgrades:
Issuer: Stratos Global Corporation
* Speculative Grade Liquidity Rating, Downgraded to SGL-4
from SGL-3
* Senior Secured Bank Credit Facility, Downgraded to 24 - LGD2
from 23 - LGD2
Outlook Actions:
Issuer: Stratos Global Corporation
* Outlook, Changed To Negative From Rating Under Review
Confirmations:
Issuer: Stratos Global Corporation
* Probability of Default Rating, Confirmed at B1
* Corporate Family Rating, Confirmed at B1
* Senior Secured Bank Credit Facility, Confirmed at Ba2
* Senior Unsecured Regular Bond/Debenture, Confirmed at B3
Stratos Global Corporation is a global provider of mobile and
fixed satellite-based communications services, headquartered in St
John's, Newfoundland, Canada, with executive offices in Bethesda,
Maryland.
STRUCTURED ASSET: Moody's Rates Class II-B-6 Certificates at Ba2
----------------------------------------------------------------
Moody's Investors Service has assigned Aaa ratings to the senior
certificates issued by Structured Asset Mortgage Investment II
Trust 2007-AR3, and ratings ranging from Aa1to Ba2 to the
mezzanine and subordinate certificates in the deal.
The securitization is backed by first lien, adjustable-rate,
negative amortization Alt-A mortgage loans. The collateral in
Group I was originated by Countrywide Home Loans, Inc. The
collateral in Group II was originated by Aegis Mortgage
Corporation and Opteum Financial Services, LLC., and various other
originators, none of which originated more than 10% of the initial
mortgage loans in this pool. The ratings are based primarily on
the credit quality of the loans and on protection against credit
losses from subordination, excess spread, overcollateralization,
interest rate cap and swap agreements. Moody's expects collateral
losses to range from 1.15% to 1.35% for Group I and collateral
losses to range from 1.00% to 1.20% for Group II.
EMC Mortgage Corporation and Countrywide Home Loans Servicing LP
will service the mortgage loans and Wells Fargo Bank, National
Association will act as master servicer. Moody's has assigned EMC
its servicer quality rating of SQ2 as a primary servicer of prime
mortgage loans. Furthermore, Moody's has assigned Wells Fargo its
top servicer quality rating of SQ1 as a master servicer of
mortgage loans.
The complete rating actions are:
Structured Asset Mortgage Investment II Trust 2007-AR3
Mortgage Pass-Through Certificates, Series 2007-AR3
* Cl. I-A-1, Assigned Aaa
* Cl. I-A-2, Assigned Aaa
* Cl. I-A-3, Assigned Aaa
* Cl. I-A-4A, Assigned Aaa
* Cl. Grantor Trust I-A-4B, Assigned Aaa
* Cl. I-A-5, Assigned Aaa
* Cl. I-X-1, Assigned Aaa
* Cl. I-X-2, Assigned Aaa
* Cl. I-B-1, Assigned Aaa
* Cl. I-B-2, Assigned Aa1
* Cl. I-B-3, Assigned Aa1
* Cl. I-B-4, Assigned Aa2
* Cl. I-B-5, Assigned Aa3
* Cl. I-B-6, Assigned A1
* Cl. I-B-7, Assigned A3
* Cl. I-B-8, Assigned Baa2
* Cl. I-B-9, Assigned Baa3
* Cl. Underlying I-A-4B, Assigned Aaa
* Cl. II-A-1, Assigned Aaa
* Cl. II-A-2, Assigned Aaa
* Cl. II-A-3A, Assigned Aaa
* Cl. Grantor Trust II-A-3B, Assigned Aaa
* Cl. II-B-1, Assigned Aa1
* Cl. II-B-2, Assigned Aa3
* Cl. II-B-3, Assigned A2
* Cl. II-B-4, Assigned A3
* Cl. II-B-5, Assigned Baa1
* Cl. II-B-6, Assigned Ba2
* Cl. Underlying II-A-3B, Assigned Aaa
TALLAHASSEE 99-FL: Case Summary & Two Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Tallahassee 99-FL, L.L.C.
c/o Klein & Solomon
275 Madison Avenue
11th Floor New York, NY 10016
Bankruptcy Case No.: 07-11342
Chapter 11 Petition Date: May 4, 2007
Court: Southern District of New York (Manhattan)
Judge: James M. Peck
Debtor's Counsel: Mark A. Frankel, Esq.
Backenroth Frankel & Krinsky, L.L.P.
489 Fifth Avenue
New York, NY 10017
Tel: (212) 593-1100
Fax: (212) 644-0544
Estimated Assets: $4,950,000
Estimated Debts: $3,900,314
Debtor's Two Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Twin Action Properties 2910 Kerry $270,488
2915 Kerry Forest Parkway, Forrest Parkway,
Suite 101 Tallahassee, FL
Tallahassee, FL 32309 32308 46,000
square foot
vacant anchor
store in shopping
center (formerly
leased to Winn
Dixie as groc.);
value of
security:
$3,750,000; value
of senior lien:
$3,500,000
Jamarco Realty $129,826
144 June Road
North Salem, NY 10560
TENFOLD CORP: Posts Net Loss of $932,000 in Quarter Ended March 31
------------------------------------------------------------------
TenFold Corporation reported a net loss of $932,000 on total
revenues of $1.8 million for the first quarter ended March 31,
2007, compared with a net loss of $3.7 million on total revenues
of $599,000 for the same period last year.
At March 31, 2007, the company's balance sheet showed $4 million
in total assets, $2.4 million in total liabilities, and
$1.6 million in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended March 31, 2007, are available for
free at http://researcharchives.com/t/s?1e99
Going Concern Doubt
As reported in the Troubled Company Reporter on March 5, 2007,
Tanner LC in Salt Lake City, Utah, expressed substantial doubt
about Tenfold Corp.'s ability to continue as a going concern after
auditing the company's financial statements for the years ended
Dec. 31, 2006, and 2005. The auditing firm cited that the company
used significant balances of its cash in operating activities
and at present levels of cash consumption will not have sufficient
resources to meet operating needs.
About TenFold Corporation
TenFold Corporation (OTC BB: TENF) -- http://www.tenfold.com/--
licenses its patented technology for applications and services
development, EnterpriseTenFold SOA, to organizations that face the
daunting task of replacing obsolete applications or building
complex SOA-compliant applications systems.
TRUMP ENTERTAINMENT: Posts $8 Mil. Net Loss in Qtr. Ended March 31
------------------------------------------------------------------
Trump Entertainment Resorts Inc. reported a net loss of
$8.1 million for the quarter ended March 31, 2007, as compared
with a net loss of $9.7 million for the three months ended March
31, 2006. The company generated total revenues of $295.3 million
for the first quarter of 2007, as compared with $299.4 million for
the first quarter of 2006.
Mark Juliano, the company's chief operating officer, said, "The
operational improvements that we have focused on executing over
the past 18 months are showing positive effects. While our first
quarter results were certainly impacted by the introduction of new
regional competition, our plan to decrease promotional costs,
eliminate unprofitable business and run our operations more
efficiently allowed us to keep EBITDA flat year over year. The
benefits of these efforts are clear because, although gaming
revenue declined, our cash room, food and beverage revenues
increased 12% over the first quarter of last year, and our
property level payroll expense declined by over $4 million or
nearly 5%.
"The company's capital improvement program during 2007 has
included the opening of a variety of new venues at the Taj Mahal
and the debut of Finestra, a new gourmet Italian restaurant, at
Trump Marina. Specifically, at the Taj Mahal, the restaurant
portion of the Spice Road promenade redevelopment project is
nearly complete, and new outlets Burger, Freeze and Candy are open
for business. Plate, a new 24-hour restaurant, opened April 30th
and, Go, a new quick service eatery is expected to open by mid-
May. We expect Starbucks, as well as new specialty flower and
retail outlets to open during the second quarter, which will
complete the Spice Road project.
"Also at the Taj Mahal, the casino floor renovation is in
progress, and the company expects approximately half of the floor
to be complete by the end of the second quarter. The remainder of
the Taj Mahal casino floor renovation is scheduled for completion
by the end of 2007. In addition, the newly renovated super suites
at the Taj Mahal are expected to be completed by the end of the
second quarter.
"The redevelopment efforts at all three properties are designed to
capture market position and appeal to our target customers. At the
Marina, the Company will debut several capital improvements during
the second quarter, including a new high-end slots area, a new 24-
hour restaurant and a new steakhouse.
"Additionally, we continue to improve our slot product on the
casino floor through an aggressive replacement and machine
conversion program."
Mr. Juliano continued, "We will launch Trump One, our new unified
players' club, in June of this year. We are particularly excited
about this debut as we have specifically designed this program to
encourage more frequent visitation from existing customers and to
attract new, more profitable business through the introduction of
a compelling rewards program, which will introduce new features
for club members and by jointly marketing the assets of our three
properties.
"We are also beginning to utilize our revenue management system
across our three properties, and have recently added Ravneet
Bhandari, who has extensive experience in both the gaming and
lodging industries, as Senior Vice President of Revenue
Management. We believe that this effort will help us to more
efficiently yield our hotel rooms to maximize overall revenues and
increase our profitable group sales and convention business."
James B. Perry, chief executive officer and president stated, "The
programs that were put in place last year to improve our operating
margins showed positive results for the third consecutive quarter.
The revenue decline due to new competition provided a minor
setback, and our management team continues to work hard in a very
competitive promotional environment to lower marketing and general
administrative expenses in order to bring our margins closer in
line with our Atlantic City competitors.
We are confident in the plan we put in place nearly two years ago
to improve the company's operating margins, renovate our Atlantic
City properties, operate more effectively and efficiently, and
create value for our shareholders. We believe that the clear
signs of progress during the past three quarters have resulted
from our focus on executing our strategic plan."
Capital Structure
As of March 31, 2007, the company had cash and cash equivalents of
$ 83.1 million excluding $27.3 million of cash restricted in use
by the agreement governing the sale of Trump Indiana. The company
indicated total debt had decreased by $4.9 million since Dec. 31,
2006, to $1,402.5 million at March 31, 2007, due to repayments of
capital lease obligations. Capital expenditures for the quarter
ended March 31, 2007, were about $58 million, consisting of
$9 million maintenance capital, $39 million renovation capital,
and $10 million for the Taj Mahal Tower. Capitalized interest in
the first quarter of 2007 was $800,000, as compared with an
insignificant amount during the first quarter of 2006.
The company had total assets of $2.2 billion, total liabilities of
$1.7 billion, and minority interest of $123 million, resulting in
a total stockholders' equity of $405.4 million as of March 31,
2007.
Annual Meeting Election Results
At the company's Annual Meeting held on May 2, 2007, shareholders
reelected Donald J. Trump, Morton E. Handel and James B. Perry as
directors and ratified the appointment of Ernst & Young as the
company's independent registered public accounting firm for the
year ending Dec. 31, 2007. About 39.7 million shareholders
participated in the election, representing over 98% of those
eligible to vote.
About Trump Entertainment
Based in Atlantic City, New Jersey, Trump Hotels & Casino Resorts,
Inc., now known as Trump Entertainment Resorts Inc. (Nasdaq: TRMP)
-- http://www.trumpcasinos.com/-- through its subsidiaries, owns
and operates four properties and manages one property under the
Trump brand name. The company and its debtor-affiliates filed for
Chapter 11 bankruptcy protection on Nov. 21, 2004 (Bankr. D. N.J.
Case No. 04-46898 through 04-46925). The Court confirmed the
Debtors' Second Amended Plan of Reorganization on Apr. 5, 2005.
The Plan took effect on May 20, 2005.
* * *
As reported in the Troubled Company Reporter on March 13, 2007,
Standard & Poor's Ratings Services placed its ratings for Trump
Entertainment Resorts Holdings L.P., including the 'B' corporate
credit rating, on CreditWatch with developing implications.
VIASPACE INC: Singer Lewak Expresses Going Concern Doubt
--------------------------------------------------------
Singer Lewak Greenbaum & Goldstein LLP, in Los Angeles, Calif.,
raised substantial doubt about VIASPACE Inc.'s ability to continue
as a going concern after auditing the company's financial
statements as of Dec. 31, 2006, and 2005. The auditing firm
reported that the company has suffered recurring losses from
operations and its total liabilities exceed its total assets.
Singer Lewak added that the company has an accumulated deficit of
$11,032,000 and a shareholders' deficit of $3,199,000.
Revenue for the year ended Dec. 31, 2006, was $962,000, as
compared with $432,000 in 2005, an increase of $530,000. Gross
profit in 2006 was $196,000, as compared with $77,000 for 2005.
Net loss was $9,601,000 in 2006, as compared with a net loss of
$2,311,000 in 2005.
Fourth Quarter Results
Revenue for the fourth quarter of 2006 was $292,000, as compared
with $103,000 in the same quarter of 2005, an increase of
$189,000. Gross profit for the fourth quarter of 2006 was $53,000
compared with $6,000 for the comparable quarter of 2005. Net loss
was $5,259,000 for the fourth quarter of 2006, compared to net
loss of $1,052,000 for the same quarter of 2005.
Debenture Restructuring
The convertible debenture transaction was restructured on March 8,
2007 whereby the existing convertible debentures were converted to
common stock and additional cash proceeds of $910,800 were
received. As a result of the restructuring, the company expects
to record an increase to stockholders' equity of about $5,900,000
during the first quarter of 2007.
Commenting on fourth quarter and year-end results, Dr. Carl
Kukkonen, chief executive officer of VIASPACE Inc., said, "The
fourth quarter and full year of 2006 marks increased revenue for
VIASPACE primarily due to our subsidiary VIASPACE Security Inc.
reporting revenues on its contract with L-3 Communications,
Security and Detection Systems (L-3). This contract is to provide
sensor data fusion software and VIASPACE Security's SHINE
inference engine technology for the Advanced Container Security
Device (ACSD) project, under a contract awarded to L-3 by the US
Department of Homeland Security. The ACSD project aims to develop
the next generation of maritime cargo container security.
Dr. Kukkonen continued, "In addition, during 2006, our subsidiary
Direct Methanol Fuel Cell Corporation (DMFCC) achieved milestones
and recognized revenues related to the design, production and test
of prototype fuel cell cartridges. Revenue was also generated
from our subsidiary Ionfinity's continuing fulfillment of US Navy,
US Air Force and US Army contracts."
Dr. Kukkonen added, "We also continue to invest in R&D for
commercial products. We have also increased spending in sales and
marketing expenses to improve customer awareness of our products.
It has been announced that direct methanol fuel cells are being
developed for portable electronic applications by leading OEMs.
Industry sources are expecting these products to be in the
marketplace in 2007/2008."
As of Dec. 31, 2006, the company listed total assets valued at
$4 million, total liabilities of $6.6 million, and minority
interest of $556,000, resulting in a total stockholders' deficit
of $3.2 million.
A full-text copy of the company's 2006 annual report is available
for free at http://ResearchArchives.com/t/s?1e9b
About VIASPACE
VIASPACE Inc. (OTC BB: VSPC) -- http://www.viaspace.com/--
commercializes space and defense technologies from NASA and the
department of defense into hardware and software products in the
U.S. The company provides disposable fuel cartridges and
intellectual property protection for manufacturers of direct
methanol and other liquid hydrocarbon fuel cells; and develops
products and services based on inference and sensor data fusion
technology. It also develops mass spectrometry technology for
industrial process control and environmental monitoring, and
produces detection systems for homeland security, as well as holds
patents and various patent applications in the areas of
interactive radio technology.
YUKOS OIL: Slovakia Wants Russian Help Over Transpetrol Stake
-------------------------------------------------------------
Slovakian Prime Minister Robert Fico has sought the help of
Russian officials in resolving the fate of OAO Yukos Oil Co.'s 49
percent stake in Transpetrol a.s., The St. Petersburg Times
relates citing reports from the Associated Press.
In a meeting with Russian President Vladimir Putin and Prime
Minister Mikhail Fradkov, Mr. Fico asked Russia for "comprehensive
support in the elimination of all barriers in the transfer of
Yukos property and shares to Transpetrol," St. Petersburg Times
reports citing Itar-Tass as its source.
As reported in the Troubled Company Reporter on March 20, the
Economy Ministry of Slovakia sought to extend its veto power
against any possible sale of Yukos' minority stake.
The Slovakian government sold these shares to Yukos Finance BV,
the Dutch subsidiary of bankrupt OAO Yukos Oil Co., in 2002.
Under terms of the deal, Slovakia retains the right to block the
sale of these shares until April 2007.
The state, which holds the remaining 51% in Transpetrol,
indicated last year that it is trying to reinforce its position
over the company by repurchasing the 49% stake it sold to Yukos.
About Transpetrol
Transpetrol a.s. -- http://www.transpetrol.sk/-- operates the
Slovak part of the Druzhba oil pipeline through which about 10
million tons of Russian oil flow to western Europe annually.
About Yukos Oil
Headquartered in Moscow, Yukos Oil -- http://yukos.com/-- is an
open joint stock company existing under the laws of the Russian
Federation. Yukos is involved in energy industry substantially
through its ownership of its various subsidiaries, which own or
are otherwise entitled to enjoy certain rights to oil and gas
production, refining and marketing assets.
The Company filed for Chapter 11 protection on Dec. 14, 2004
(Bankr. S.D. Tex. Case No. 04-47742), but the case was
dismissed on Feb. 24, 2005, by the Hon. Letitia Z. Clark. A
few days later, the Russian Government sold its main production
unit Yugansk to a little-known firm Baikalfinansgroup for
$9.35 billion, as payment for $27.5 billion in tax arrears for
2000-2003. Yugansk eventually was bought by state-owned Rosneft,
which is now claiming more than US$12 billion from Yukos.
On March 10, 2006, a 14-bank consortium led by Societe Generale
filed a bankruptcy suit in the Moscow Arbitration Court in an
attempt to recover the remainder of a $1 billion debt under
outstanding loan agreements. The banks, however, sold the claim
to Rosneft, prompting the Court to replace them with the state-
owned oil company as plaintiff.
On April 13, 2006, court-appointed external manager Eduard
Rebgun filed a chapter 15 petition in the U.S. Bankruptcy Court
for the Southern District of New York (Bankr. S.D.N.Y. Case No.
06-0775), in an attempt to halt the sale of Yukos' 53.7%
ownership interest in Lithuanian AB Mazeikiu Nafta.
On May 26, 2006, Yukos signed a $1.49 billion Share Sale and
Purchase Agreement with PKN Orlen S.A., Poland's largest oil
refiner, for its Mazeikiu ownership stake. The move was made a
day after the Manhattan Court lifted an order barring Yukos from
selling its controlling stake in the Lithuanian oil refinery.
On Aug. 1, 2006, the Hon. Pavel Markov of the Moscow Arbitration
Court upheld creditors' vote to liquidate OAO Yukos Oil Co. and
declared what was once Russia's biggest oil firm bankrupt.
YUKOS OIL: Shell & BP Set to Join Auction for Petrol Stations
-------------------------------------------------------------
Royal Dutch Shell and TNK-BP Holding Ltd. will participate in
tomorrow's auction for OAO Yukos Oil Co.'s 537 petrol stations in
Russia, published reports say.
OAO Rosneft and Unitex are also expected to bid for the petrol
station network, which carries a RUR7.7 billion starting price.
As widely reported, TNK-BP submitted a bid to acquire Yukos' 9.44%
stake in Rosneft during the first series of Yukos auctions on
March 27. However, RN-Razvitiye, a Rosneft subsidiary, outbid
TNK-BP when it offered RUR197.8 billion for the assets. Analysts
criticized the sell-off accusing TNK-BP of participating in the
auction only to appease the Kremlin as two bidders would
legitimize the sale process, Russell Hotten writes for
Telegraph.co.uk.
Published reports say TNK-BP and Shell have confirmed their
interest in joining the bidding race. TNK-BP, Steve Hawkes of
Times Online notes, already runs 1,600 petrol stations across
Russia.
About Yukos Oil
Headquartered in Moscow, Yukos Oil -- http://yukos.com/-- is an
open joint stock company existing under the laws of the Russian
Federation. Yukos is involved in energy industry substantially
through its ownership of its various subsidiaries, which own or
are otherwise entitled to enjoy certain rights to oil and gas
production, refining and marketing assets.
The Company filed for Chapter 11 protection on Dec. 14, 2004
(Bankr. S.D. Tex. Case No. 04-47742), but the case was
dismissed on Feb. 24, 2005, by the Hon. Letitia Z. Clark. A
few days later, the Russian Government sold its main production
unit Yugansk to a little-known firm Baikalfinansgroup for
$9.35 billion, as payment for $27.5 billion in tax arrears for
2000-2003. Yugansk eventually was bought by state-owned Rosneft,
which is now claiming more than $12 billion from Yukos.
On March 10, 2006, a 14-bank consortium led by Societe Generale
filed a bankruptcy suit in the Moscow Arbitration Court in an
attempt to recover the remainder of a $1 billion debt under
outstanding loan agreements. The banks, however, sold the claim
to Rosneft, prompting the Court to replace them with the state-
owned oil company as plaintiff.
On April 13, 2006, court-appointed external manager Eduard
Rebgun filed a chapter 15 petition in the U.S. Bankruptcy Court
for the Southern District of New York (Bankr. S.D.N.Y. Case No.
06-0775), in an attempt to halt the sale of Yukos' 53.7%
ownership interest in Lithuanian AB Mazeikiu Nafta.
On May 26, 2006, Yukos signed a $1.49 billion Share Sale and
Purchase Agreement with PKN Orlen S.A., Poland's largest oil
refiner, for its Mazeikiu ownership stake. The move was made a
day after the Manhattan Court lifted an order barring Yukos from
selling its controlling stake in the Lithuanian oil refinery.
On Aug. 1, 2006, the Hon. Pavel Markov of the Moscow Arbitration
Court upheld creditors' vote to liquidate OAO Yukos Oil Co. and
declared what was once Russia's biggest oil firm bankrupt.
YUKOS OIL: RFFI Sets May 11 Auction for Office & Research Assets
----------------------------------------------------------------
The Russian Federal Property Fund will auction OAO Yukos Oil Co.'s
Moscow office and its research and development assets under one
lot on May 11, RIA Novosti reports.
The lot, which includes the bankrupt company's 22-storey
headquarters, carry a RUR22 billion starting price, with a bid
increment of RUR110.3 million, RIAN relates.
The auction for the assets was initially scheduled in early April
but was called off due to a lack of bids. The auctioneer did not
disclose the bidders participating in the auction.
Headquartered in Moscow, Yukos Oil -- http://yukos.com/-- is an
open joint stock company existing under the laws of the Russian
Federation. Yukos is involved in energy industry substantially
through its ownership of its various subsidiaries, which own or
are otherwise entitled to enjoy certain rights to oil and gas
production, refining and marketing assets.
The Company filed for Chapter 11 protection on Dec. 14, 2004
(Bankr. S.D. Tex. Case No. 04-47742), but the case was dismissed
on Feb. 24, 2005, by the Hon. Letitia Z. Clark. A few days
later, the Russian Government sold its main production unit
Yugansk to a little-known firm Baikalfinansgroup for
$9.35 billion, as payment for $27.5 billion in tax arrears
for 2000-2003. Yugansk eventually was bought by state-owned
Rosneft, which is now claiming more than $12 billion from Yukos.
On March 10, 2006, a 14-bank consortium led by Societe Generale
filed a bankruptcy suit in the Moscow Arbitration Court in an
attempt to recover the remainder of a $1 billion debt under
outstanding loan agreements. The banks, however, sold the claim
to Rosneft, prompting the Court to replace them with the state-
owned oil company as plaintiff.
On April 13, 2006, court-appointed external manager Eduard
Rebgun filed a chapter 15 petition in the U.S. Bankruptcy Court
for the Southern District of New York (Bankr. S.D.N.Y. Case No.
06-0775), in an attempt to halt the sale of Yukos' 53.7%
ownership interest in Lithuanian AB Mazeikiu Nafta.
On May 26, 2006, Yukos signed a $1.49 billion Share Sale and
Purchase Agreement with PKN Orlen S.A., Poland's largest oil
refiner, for its Mazeikiu ownership stake. The move was made a
day after the Manhattan Court lifted an order barring Yukos from
selling its controlling stake in the Lithuanian oil refinery.
On Aug. 1, 2006, the Hon. Pavel Markov of the Moscow Arbitration
Court upheld creditors' vote to liquidate OAO Yukos Oil Co. and
declared what was once Russia's biggest oil firm bankrupt.
ZOOMERS HOLDING: Bankruptcy Court Dismisses Chapter 11 Case
-----------------------------------------------------------
The Honorable Alexander L. Paskay of the U.S. Bankruptcy Court for
the Middle District of Florida entered an order on May 1, 2007,
granting the request of Florida Community Bank to dismiss the
Chapter 11 case of Zoomers Holding Co. LLC.
As reported in the Troubled Company Reporter on May 23, 2006,
Florida Community, a secured creditor of the Debtor, contended
that the Debtor's chapter 11 case was filed in bad faith citing:
a. the Debtor's real property located in Lee County, Florida,
is encumbered by liens, which exceeds the fair market value
of the real property;
b. the Debtor has no other employees aside from its
principals;
c. the Debtor's financial problems involve a dispute between
the Debtor and Florida Community, along with junior lien
creditors, which can be resolved in the pending state court
foreclosure action;
d. the Debtor has no cash flow and no available sources of
income to sustain a plan of reorganization or make adequate
protection payments;
e. there are no non-insider unsecured creditors whose claims
are relatively small in light of the total obligation owed
by the Debtor; and
f. there is no realistic possibility of an effective
reorganization.
The Debtor also filed a Notice of Consent to Dismissal on
April 30, 2007.
Headquartered in Osprey, Florida, Zoomers Holding Company, LLC,
filed for chapter 11 protection on Apr. 28, 2006 (Bankr. M.D. Fla.
Case No. 06-02008). Richard Johnston, Jr., Esq., at Kiesel Hughes
& Johnston, represents the Debtor. When the Debtor filed for
protection from its creditors, it estimated assets and debts
between $10 million and $50 million.
* Gibson Dunn Adds Eric Feuerstein as Real Estate Partner in NY
---------------------------------------------------------------
Gibson, Dunn & Crutcher LLP has named Eric M. Feuerstein, Esq. as
real estate partner in its New York office.
Previously a partner with Fried, Frank, Harris, Shriver &
Jacobson, Mr. Feuerstein has a practice that focuses on high-end,
capital-market driven real estate transactions.
"We're delighted to have Eric join the firm," said Ken Doran,
Managing Partner of Gibson Dunn. "A rising star in New York's
real estate bar, he will significantly help us expand our national
and international real estate practice."
"Eric is highly regarded not only by the New York real estate bar,
but also by brokers, owners, developers and bankers," said Steven
Shoemate, partner in Charge of the New York office. "Eric is a
talented and experienced lawyer, who will be a dynamic addition to
the firm. We look forward to working with him as we continue to
expand our presence and build on our success in New York."
"I'm very excited about the opportunity that Gibson Dunn has
extended to me," Mr. Feuerstein said. "My practice fits in nicely
with the firm's real estate practice in New York, nationally and
internationally, and I look forward to working together with my
new colleagues."
Feuerstein's real estate practice focuses on acquisitions, joint
ventures, leasing, development and financing. His clients have
included landlords, developers and institutional investors.
He recently represented Jamestown Properties in the $1.5 billion
sale of its 1121 6th Avenue property, as well as the $300 million
sale of 620 6th Avenue and in the sale of its condominium interest
in the Random House building to The Witkoff Group for $510
million. He has also recently represented Apollo and Vantage in
purchasing $1 billion of residential properties in New York City.
He received his law degree from Benjamin N. Cardozo School of Law
in 1995 and his bachelor's degree, cum laude, from Cornell
University in 1991.
About Gibson Dunn
Gibson, Dunn & Crutcher LLP -- http://www.gibsondunn.com/-- is an
international law firm that has more than 800 lawyers and 13
offices, including Los Angeles, New York, Washington, D.C., San
Francisco, Palo Alto, London, Paris, Munich, Brussels, Orange
County, Century City, Dallas and Denver. The firm specializes in
real estate debt and equity finance, development, sales and
acquisitions, land use and environmental issues, leasing, and
workout transactions.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
May 14-16, 2007
TURNAROUND MANAGEMENT ASSOCIATION
1st Annual TMA Regional Conference - Texas
Hyatt Regency Resort & Spa
Lost Pines, Texas
Contact: http://www.turnaround.org/
May 15, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Corporate Restructuring Workshop
Cable Center, Denver, Colorado
Contact: http://www.turnaround.org/
May 15, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Corporate Restructuring Workshop
Cable Center, Denver, Colorado
Contact: http://www.turnaround.org/
May 16, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South Florida
Contact: 561-882-1331 or http://www.turnaround.org/
May 16, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Bankruptcy Judges Panel
Marriott North, Fort Lauderdale, Florida
Contact: http://www.turnaround.org/
May 17-18, 2007
TURNAROUND MANAGEMENT ASSOCIATION
6th Annual Great Lakes Regional Conference
Renaissance Quail Hollow Resort, Painesville, Ohio
Contact: http://www.turnaround.org/
May 17, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Enterprise Valuation / Sale of the Distressed Business
Athletic Club, Seattle, Washington
Contact: http://www.turnaround.org/
May 17, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Women's Networking Lunch
TBD, Arizona
Contact: 623-581-3597 or www.turnaround.org/
May 18, 2007
TURNAROUND MANAGEMENT ASSOCIATION
13 Week CF Program
Kansas City, Missouri
Contact: http://www.turnaround.org/
May 21, 2007
TURNAROUND MANAGEMENT ASSOCIATION
LI-TMA Annual Golf Outing
TBD, Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
May 22, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Hedge Funds
Standard Club, Chicago, Illinois
Contact: http://www.turnaround.org/
May 23, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
Calaloo Caf,, Morristown, New Jersey
Contact: 908-575-7333 or www.turnaround.org/
May 24-25, 2007
BEARD GROUP AND RENAISSANCE AMERICAN CONFERENCES
Fourth Annual Conference on Distressed Investing Europe
Maximizing Profits in the European Distressed Debt
Market
Le Meridien Piccadilly Hotel - London, UK
Contact: 800-726-2524;
http://renaissanceamerican.com/
May 24, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Arizona and RMA Joint Meeting
Hotel Valley Ho, Scottsdale, Arizona
Contact: http://www.turnaround.org/
May 29, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon - Bankruptcy Judges Panel
Citrus Club, Orlando, Florida
Contact: http://www.turnaround.org/
May 30-31, 2007
FINANCIAL RESEARCH ASSOCIATES
Distressed Debt
Harvard Club, New York, New York
Contact: http://www.frallc.com/
May 31, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Wine Tasting and Casino Night
Mayfair Farms, West Orange, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
May 31, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Series
E&Y Tower, Calgary, Alberta
Contact: http://www.turnaround.org/
May 31 - June 1, 2007
TURNAROUND MANAGEMENT ASSOCIATION
2nd Annual TMA Southeast Regional Conference
Marriott Resort at Grande Dunes
Myrtle Beach, South Carolina
Contact: http://www.turnaround.org/
June 4-7, 2008
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
24th Annual Bankruptcy & Restructuring Conference
JW Marriott Spa and Resort, Las Vegas, Nevada
Contact: http://http://www.airacira.org/
June 6-8, 2007
TURNAROUND MANAGEMENT ASSOCIATION
5th Annual Mid-Atlantic Regional Symposium
Borgata Hotel Casino & Spa
Atlantic City, New Jersey
Contact: http://www.turnaround.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 7-8, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Mealey's Asbestos Bankruptcy Conference
Intercontinental Hotel, Chicago, Illinois
Contact: http://www.turnaround.org/
June 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Association for Corporate Growth Arizona Chapter Meeting
Biltmore Hotel, Phoenix, Arizona
Contact: http://www.turnaround.org/
June 14, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Economic Update at the 1/2 Year Mark
University Club, Portland, Oregon
Contact: http://www.turnaround.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/
June 19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
Clarion Hotel, Princeton, New Jersey
Contact: 908-575-7333 or www.turnaround.org/
June 21-22, 2007
BEARD GROUP AND RENAISSANCE AMERICAN CONFERENCES
Tenth Annual Conference on Corporate Reorganizations
Successful Strategies for Restructuring Troubled
Companies
The Millennium Knickerbocker Hotel - Chicago
Contact: 800-726-2524;
http://renaissanceamerican.com/
June 26, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon - Bankruptcy Judges Panel
Centre Club, Tampa, Florida
Contact: http://www.turnaround.org/
June 28 - July 1, 2007
NORTON INSTITUTES
Norton Bankruptcy Litigation Institute
Jackson Lake Lodge, Jackson Hole, Wyoming
Contact: http://www2.nortoninstitutes.org/
July 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon - Bankruptcy Judges Panel
University Club, Jacksonville, Florida
Contact: http://www.turnaround.org/
July 12-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Marriott, Newport, Rhode Island
Contact: 1-703-739-0800; http://www.abiworld.org/
July 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Young Professionals Billiards Night
TBD, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
July 13, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Body of Knowledge - CTP Review Class
Chicago, Illinois
Contact: http://www.turnaround.org/
July 18, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South Florida
Contact: 561-882-1331 or http://www.turnaround.org/
July 25-28, 2007
AMERICAN BANKRUPTCY INSTITUTE
12th Annual Southeast Bankruptcy Workshop
The Sanctuary, Kiawah Island, South Carolina
Contact: http://www.abiworld.org/
July 26, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Arizona Chapter Meeting
Contact: http://www.turnaround.org/
July 30, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Annual Golf Outing
Raritan Valley Country Club, Bridgewater, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
July 31, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Enterprise Florida: Improving Florida's
Business Climate and Helping Florida Companies
Market Overseas
Citrus Club, Orlando, Florida
Contact: http://www.turnaround.org/
Aug. 3, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Women's Spa Event
Short Hills Hilton, Livingston, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
Aug. 10, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Body of Knowledge - CTP Review Class
Chicago, Illinois
Contact: http://www.turnaround.org/
Aug. 9-11, 2007
AMERICAN BANKRUPTCY INSTITUTE
3rd Annual Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay
Cambridge, Maryland
Contact: http://www.abiworld.org/
Aug. 23-26, 2007
NATIONAL ASSOCIATION OF BANKRUPTCY JUDGES
NABT Convention
Drake Hotel, Chicago, Illinois
Contact: http://www.nabt.com/
Aug. 24, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Annual Fishing Trip
Point Pleasant, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
Aug. 28, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon - Healthcare Panel
Centre Club, Tampa, Florida
Contact: http://www.turnaround.org/
Aug. 29-30, 2007
TURNAROUND MANAGEMENT ASSOCIATION
3rd Annual Northeast Regional Conference
Gideon Putnam Resort and Spa, Saratoga Springs,
New York
Contact: http://www.turnaround.org/
Sept. 6-7, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Complex Financial Restructuring Program
Four Seasons, Las Vegas, Nevada
Contact: http://www.turnaround.org/
Sept. 6-8, 2007
AMERICAN BANKRUPTCY INSTITUTE
15th Annual Southwest Bankruptcy Conference
Four Seasons
Las Vegas, Nevada
Contact: http://www.abiworld.org/
Sept. 14, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Body of Knowledge - CTP Review Class
Chicago, Illinois
Contact: http://www.turnaround.org/
Sept. 19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Buying and Selling Troubled Companies
Marriott North, Fort Lauderdale, Florida
Contact: http://www.turnaround.org/
Sept. 19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South Florida
Contact: 561-882-1331 or http://www.turnaround.org/
Sept. 25, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon - Retail Panel
Citrus Club, Orlando, Florida
Contact: http://www.turnaround.org/
Sept. 26, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Joint Educational & Networking Reception
TBD, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
Sept. 27, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Arizona Chapter Meeting
Contact: http://www.turnaround.org/
Sept. 27-30, 2007
TURNAROUND MANAGEMENT ASSOCIATION
8th Annual Cross Border Business
Restructuring & Turnaround Conference
Contact: http://www.turnaround.org/
Oct. 2, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
TBD, Bridgewater, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
Oct. 9-10, 2007
IWIRC
Orlando, Florida
IWIRC Annual Fall Conference
Contact: http://www.iwirc.org/
Oct. 10-13, 2007
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
81st Annual National Conference of Bankruptcy Judges
Contact: http://www.ncbj.org/
Oct. 11, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
Oct. 16-19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place
Boston, Massachussets
Contact: 312-578-6900; http://www.turnaround.org/
Oct. 25, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Capital Markets Case Study
Contact: http://www.turnaround.org/
Oct. 25, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Arizona Chapter Meeting
Contact: http://www.turnaround.org/
Oct. 30, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
Oct. 30, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Crisis Communications With Employees,Vendors and Media
Centre Club, Tampa, Florida
Contact: http://www.turnaround.org/
Nov. 1, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
TBD, Hackensack, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
Nov. 14, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Dinner
South Florida
Contact: 561-882-1331 or http://www.turnaround.org/
Nov. 15, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Portland Holiday Party
University Club, Portland, Oregon
Contact: 206-223-5495 or http://www.turnaround.org/
Nov. 22, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Networking Mixer
TBA, Vancouver
Contact: 206-223-5495 or www.turnaround.org/
Nov. 27, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon - Real Estate Panel
Citrus Club, Orlando, Florida
Contact: http://www.turnaround.org/
Nov. 29, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Special Speaker
TBD, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
Nov. 29, 2007
TMA Arizona Chapter Meeting
TURNAROUND MANAGEMENT ASSOCIATION
Contact: http://www.turnaround.org/
Dec. 6, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Seattle Holiday Party
Athletic Club, Seattle, Washington
Contact: 206-223-5495 or http://www.turnaround.org/
Dec. 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/
Dec. 19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South Florida
Contact: 561-882-1331 or http://www.turnaround.org/
Jan. 10, 2008
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, Florida
March 25-29, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Ritz Carlton Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
April 3-6, 2008
AMERICAN BANKRUPTCY INSTITUTE
26th Annual Spring Meeting
The Renaissance, Washington, District of Columbia
Contact: http://www.abiworld.org/
June 12-14, 2008
AMERICAN BANKRUPTCY INSTITUTE
15th Annual Central States Bankruptcy Workshop
Grand Traverse Resort and Spa, Traverse City, Michigan
Contact: http://www.abiworld.org/
July 10-13, 2008
TURNAROUND MANAGEMENT ASSOCIATION
16th Annual Northeast Bankruptcy Conference
Ocean Edge Resort
Brewster, Massachussets
Contact: http://www.turnaround.org/
July 31 - Aug. 2, 2008
AMERICAN BANKRUPTCY INSTITUTE
4th Annual Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay
Cambridge, Maryland
Contact: http://www.abiworld.org/
Aug. 16-19, 2008
AMERICAN BANKRUPTCY INSTITUTE
13th Annual Southeast Bankruptcy Workshop
Ritz-Carlton, Amelia Island, Florida
Contact: http://www.abiworld.org/
Sept. 24-27, 2008
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Scottsdale, Arizona
Contact: http://www.ncbj.org/
Oct. 28-31, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott New Orleans, Louisiana
Contact: 312-578-6900; http://www.turnaround.org/
Dec. 4-6, 2008
AMERICAN BANKRUPTCY INSTITUTE
20th Annual Winter Leadership Conference
Westin La Paloma Resort & Spa
Tucson, Arizona
Contact: http://www.abiworld.org/
May 7-10, 2009
AMERICAN BANKRUPTCY INSTITUTE
27th Annual Spring Meeting
Gaylord National Resort & Convention Center
National Harbor, Maryland
Contact: http://www.abiworld.org/
Sept. 10-12, 2009
AMERICAN BANKRUPTCY INSTITUTE
17th Annual Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nevada
Contact: http://www.abiworld.org/
Oct. 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/
June 21-24, 2009
INSOL
8th International World Congress
TBA
Contact: http://www.insol.org/
Oct. 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/
BEARD AUDIO CONFERENCES
BAPCPA One Year On: Lessons Learned and Outlook
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Calpine's Chapter 11 Filing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Changes to Cross-Border Insolvencies
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Changing Roles & Responsibilities of Creditors' Committees
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Clash of the Titans -- Bankruptcy vs. IP Rights
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Coming Changes in Small Business Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Dana's Chapter 11 Filing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Deepening Insolvency - Widening Controversy: Current Risks,
Latest Decisions
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Diagnosing Problems in Troubled Companies
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Distressed Claims Trading
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Distressed Market Opportunities
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Distressed Real Estate under BAPCPA
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Employee Benefits and Executive Compensation under the New
Code
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Equitable Subordination and Recharacterization
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Fundamentals of Corporate Bankruptcy and Restructuring
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Healthcare Bankruptcy Reforms
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
High-Yield Opportunities in Distressed Investing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Homestead Exemptions under BAPCPA
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Hospitals in Crisis: The Insolvency Crisis Plaguing
Hospitals Across the U.S.
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
KERPs and Bonuses under BAPCPA
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Privacy Rights, Protections & Pitfalls in Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Real Estate Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Reverse Mergers-the New IPO?
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Second Lien Financings and Intercreditor Agreements
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Surviving the Digital Deluge: Best Practices in E-Discovery
and Records Management for Bankruptcy Practitioners
and Litigators
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Validating Distressed Security Portfolios: Year-End Price
Validation and Risk Assessment
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
When Tenants File -- A Landlord's BAPCPA Survival Guide
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
*********
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/
On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts. The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.
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.
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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 R. Jainga, Ronald C. Sy,
Joel Anthony G. Lopez, Cecil R. Villacampa, Jason A. Nieva,
Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez,
Tara Marie A. Martin, John Paul C. Canonigo, and Peter A. Chapman,
Editors.
Copyright 2007. 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 $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each. For subscription information, contact Christopher Beard
at 240/629-3300.
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