================================================================= PARMALAT BANKRUPTCY NEWS Issue Number 1 ----------------------------------------------------------------- Copyright 2003 (ISSN XXXX-XXXX) December 29, 2003 ----------------------------------------------------------------- Bankruptcy Creditors' Service, Inc. 215-945-7000 FAX 215-945-7001 ----------------------------------------------------------------- PARMALAT BANKRUPTCY NEWS is published by Bankruptcy Creditors' Service, Inc., 572 Fernwood Lane, Fairless Hills, Pennsylvania 19030, on an ad hoc basis (generally every 10 to 20 days) as significant activity occurs in the Debtors' cases. New issues are prepared by Christopher G. Patalinghug, Frauline S. Abangan and Peter A. Chapman, Editors. Subscription rate is US$45 per issue. Any Re-mailing of PARMALAT BANKRUPTCY NEWS is prohibited. ================================================================= IN THIS ISSUE ------------- [00000] HOW TO SUBSCRIBE TO PARMALAT BANKRUPTCY NEWS [00001] BACKGROUND & DESCRIPTION OF PARMALAT [00002] GROUP'S CONSOLIDATED BALANCE SHEET AT JUNE 30, 2003 [00003] PARENT COMPANY'S DECONSOLIDATED JUNE 30 BALANCE SHEET [00004] COMPANY'S PRESS RELEASE ANNOUNCING BANKRUPTCY FILING [00005] MINISTER OF INDUSTRY TAPS ENRICO BONDI AS COMMISSIONER [00006] SECURED NOTEHOLDERS MOVE TO WIND-UP TWO CAYMAN SPVs [00007] CLESA, S.A., DISTANCES ITSELF FROM PARMALAT PARENT [00008] GRANT THORNTON SAYS IT WAS A VICTIM OF FRAUD [00009] PARMA COURT DECLARES PARMALAT S.p.A. INSOLVENT KEY DATE CALENDAR ----------------- 12/24/03 Petition for Extraordinary Administration Filed in Parma 12/27/03 Parma Court declares Parmalat S.p.A. Insolvent ----------------------------------------------------------------- [00000] HOW TO SUBSCRIBE TO PARMALAT BANKRUPTCY NEWS ----------------------------------------------------------------- PARMALAT BANKRUPTCY NEWS is distributed to paying subscribers by electronic mail. New issues are published on an ad hoc basis as significant activity occurs (generally every 10 to 20 days) in the Debtors' cases. The subscription rate is US$45 per issue. Newsletters are delivered via e-mail; invoices, transmitted following publication of each newsletter issue, arrive by fax. Re-mailing of PARMALAT BANKRUPTCY NEWS is prohibited. Distribution to multiple individuals at the same firm is provided at no additional charge; folks outside of your firm should set-up and pay for their own subscriptions. Subscriptions may be canceled at any time without further obligation. 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Name: ---------------------------------------------- Firm: ---------------------------------------------- Address: ---------------------------------------------- ---------------------------------------------- Phone: ---------------------------------------------- Fax: ---------------------------------------------- E-Mail: ---------------------------------------------- (Distribution to multiple professionals at the same firm is provided at no additional cost.) PARMALAT BANKRUPTCY NEWS is distributed to paying subscribers by electronic mail. New issues are published on an ad hoc basis as significant activity occurs (generally every 10 to 20 days) in the Debtors' cases. The subscription rate is US$45 per issue. Newsletters are delivered via e-mail; invoices, transmitted following publication of each newsletter issue, arrive by fax. Re-mailing of PARMALAT BANKRUPTCY NEWS is prohibited. Distribution to multiple individuals at the same firm is provided at no additional charge; folks outside of your firm should set-up and pay for their own subscriptions. Subscriptions may be canceled at any time without further obligation. ----------------------------------------------------------------- [00001] BACKGROUND & DESCRIPTION OF PARMALAT ----------------------------------------------------------------- Parmalat Finanziaria S.p.A. Piazza Erculea 9 20122 Milan, Italy Telephone 02-806-8801 Fax 02-869-3863 http://www.parmalat.net/ Parmalat Group North America 405 The West Mall Etobicoke, Ontario M9C 5J1, Canada Telephone (416) 626-1973 Fax (416) 620-3123 http://www.parmalat.ca/ Parmalat USA Corporation 520 Main Ave. Wallington, NJ 07057 Telephone (973) 777-2500 Fax (973) 777-7648 http://www.parmalatusa.com/ Generating more than 7 billion euros in annual revenue, The Parmalat Group employs over 36,000 workers in 139 plants located in 31 countries on six continents. In addition to its nameplate milk products that can be stored at room temperature for months, Parmalat's 40-some brand product line includes yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices. Parmalat has built a strong brand name in its main markets, produces high quality products, has an extensive distribution network and has strong advertising programs. Parmalat is Italy's 8th-largest business. With its Archway, Mother's and Salerno brands, the Company is the No. 3 cookie maker in the United States, behind Kraft Foods' Nabisco and Kellogg's Keebler. In Canada, the Company controls 25% of the fluid milk market and bakes cookies under the Colonial brand. Parmalat has sports interests, owning the Parma football team and the Palmeiras in Brazil. Parmalat's core business operations are divided into four main divisions: ____________________________________________________________ | | | | | | | | | | | | | | | 57% -- MILK PRODUCTS -- pasteurized milk and cream, | | UHT milk and cream, flavored milk, powdered | | milk, condensed milk and bechamel sauce | | | | | | | | | | | | | |____________________________________________________________| | | | 10% -- FRESH PRODUCTS -- yogurt and fermentation | | products, butter, cheese, dairy desserts and | | fruit mousse | |____________________________________________________________| | | | | | 10% -- VEGETABLE PRODUCTS -- fruit juice, juice drinks, | | tomato products, vegetable soups and tea drinks | |____________________________________________________________| | | | | | | | | | 23% -- BAKERY PRODUCTS -- snacks, cookies, pastries, | | pasta and oven-ready items such as pizza, | | focaccia and specialty breads | | | | | | | |____________________________________________________________| Parmalat's operations are grouped into four geographical areas: ________________________________________________ | | | | | | | | | | | | | | North | | | and | | Europe -- 39% | Central | | | America -- 33% | | | | | | | | | | | |_______________________| | | | |________________________| | | | South America -- 18% | | Rest of | | | the World -- 10% | | |________________________|_______________________| Parmalat's business strategy focuses on: (A) establishing milk as a branded product; (B) maintaining market share in mature markets; (C) introducing innovative products; and (D) utilizing existing production and distribution networks to increase synergies across its product divisions. The origins of the Parmalat Group date back to 1961 when Calisto Tanzi created Dietalat Srl in order to enter the market of pasteurised milk, which, at that time, was dominated by public dairies. In 1968, Dietalat Srl changed its name to Parmalat Srl and in 1973 Parmalat Srl became a joint stock company, Parmalat S.p.A. In 1990, 75% of Parmalat S.p.A.'s capital was acquired by Finanziaria Centro Nord, a holding company of the Tanzi family, which subsequently changed its name to Parmalat Finanziaria S.p.A. During 1993, Parmalat Finanziaria acquired from the Tanzi family a further 20.54% Parmalat S.p.A. shares, raising its participation to 95.54% of Parmalat S.p.A.'s voting capital; ownership reached 100% by the end of 1994. Parmalat Finanziaria S.p.A. is a joint stock company incorporated under Italian law (societa perazioni) on 24 June 1972 with its registered office at Via Oreste Grassi 26, 43044 Collecchio (PR), Italy. The Company is listed on Telematico and registered with the Parma Law Court under No. 00175250471 of the Companies Register and its fiscal number is 00175250471. Parmalat Finanziaria is the holding company of the Parmalat Group and its objects are the general objects of a holding company. Its principal subsidiary is Parmalat S.p.A., the Guarantor, which is the main operating company in the Italian market and the holding company and co-ordinator for the Group's commercial subsidiaries. Up to the beginning of 1997, Parmalat S.p.A. was Parmalat Finanziaria's only operating subsidiary. In 1997, Parmalat Finanziaria indirectly acquired shareholdings in operating subsidiaries in Colombia and Ecuador, previously held by Parmalat S.p.A., in Australia and in Canada. However, Parmalat S.p.A. remains Parmalat Finanziaria's principal subsidiary. Parmalat S.p.A. guarantees many of the holding company's debt obligations. Parmalat Finanziaria is controlled by Coloniale S.p.A., which holds 50.68% of its Shares. Coloniale S.p.A. is the holding company of the Tanzi family, founders of the Parmalat Group. The remaining 49.32% of the outstanding voting capital of Parmalat Finanziaria is listed on Telematico. Parmalat's corporate structure involves hundreds of entities. A simplified version of the companies' relationships nearest to the ultimate parent company shows: __________________ ________________ | | | | | Coloniale S.p.A. | | Public | | (Tanzi Family) | | Equity Market | |__________________| |________________| | | 50.68% 49.32% |_________________________________________| | ________________|______________ | | | Parmalat Finanziaria S.p.A. | |_______________________________| | ____________________|____________________ | | 89.18% 100.00% ________|_________ ________|_______ | |<------- 10.82% ------| | | | | | | | | | | |__________________ | | | Parmalat S.p.A. | | | Dalmata S.r.l. | | | | | | | |____________ | | | | | | | | | |__________________| | | |________________| | | | | | | 64.22% | 5.00% | | | | ___|_____ | ________|_________ | | | | | | | | 95.00%| Eurolat | | | Other | | |___| S.p.A. | | | Operating |________ | |_________| | | Subsidiaries | | | | | |__________________| 35.78%| | | | | | | _____|___| ___ ___|_________|____ | | | | | Parmalat | | Other | | SOPARFI S.A. | | Operating | |_______________| | Subsidiaries | |__________________| A 25-page listing of all known Parmalat entities is available at no charge at: http://bankrupt.com/misc/ParmalatOrganization.pdf ----------------------------------------------------------------- [00002] GROUP'S CONSOLIDATED BALANCE SHEET AT JUNE 30, 2003 ----------------------------------------------------------------- Parmalat Finanziaria Spa CONSOLIDATED BALANCE SHEET At June 30, 2003 (in euros) ASSETS A. UNPAID SHARE CAPITAL Called-up 53,000 ================ B. FIXED ASSETS I. Intangible fixed assets Start-up and expansion costs 23,454,000 Research, development and advertising costs 5,798,000 Industrial patents and intellectual property rights 19,047,000 Concessions, licences, trademarks and similar rights 391,409,000 Goodwill 455,247,000 Intangible assets in process and prepayments 3,089,000 Other assets 323,514,000 Goodwill arising from consolidation 847,222,000 ---------------- Total intangible fixed assets 2,068,780,000 ================ II. Tangible fixed assets Land and buildings 517,550,000 Plant and machinery 1,011,222,000 Industrial and commercial equipment 79,841,000 Other assets 98,821,000 Work in progress and prepayments 55,273,000 ---------------- Total tangible fixed assets 1,762,707,000 ================ III. Long-term financial assets Investments in: - unconsolidated subsidiaries 6,733,000 - associated companies 35,794,000 - other companies 37,379,000 Accounts receivable: - associated companies within 12 months 0 - others within 12 months 58,617,000 - others beyond 12 months 322,322,000 Other securities 214,885,000 ---------------- Total long-term financial assets 675,730,000 ================ Total fixed assets 4,507,217,000 ================ C. CURRENT ASSETS I. Inventory Raw, ancillary and consumable materials 191,202,000 Work in progress and semi-finished products 13,878,000 Contract work in progress 7,463,000 Finished products and goods for resale 308,791,000 Prepayments 35,460,000 ---------------- Total inventory 556,794,000 ================ II. Accounts receivable Customers within 12 months 1,280,078,000 Customers beyond 12 months 42,709,000 Subsidiaries within 12 months 1,376,000 Subsidiaries beyond 12 months 25,000 Associated companies within 12 months 1,320,000 Others within 12 months 235,872,000 Others beyond 12 months 73,034,000 Less provisions for doubtful accounts (71,117,000) ---------------- Total accounts receivable 1,563,297,000 ================ III. Current asset investments Other investments 4,000 Other securities 2,455,606,000 ---------------- Total current asset investments 2,455,610,000 ================ IV. Cash on hand and at banks Bank and post office deposits 860,807,000 Cheques 1,518,000 Cash on hand 4,257,000 ---------------- Total cash on hand and at banks 866,582,000 ================ Total current assets 5,442,283,000 ================ D. ACCRUED INCOME AND PREPAID EXPENSES Accrued income and prepaid expenses 261,951,000 ================ Total assets 10,211,504,000 ================ LIABILITIES AND SHAREHOLDERS' EQUITY A. SHAREHOLDERS' EQUITY Attributable to the Group Share capital 815,670,000 Share premium reserve 71,880,000 Legal reserve 9,356,000 Other reserves: - extraordinary reserve 33,087,000 - consolidation reserve 368,993,000 Net profit for the year 0 Pre-tax profit for the period 119,917,000 ---------------- Total group shareholders' equity 1,418,903,000 ================ Minority interests in Share capital and reserves 675,508,000 Profit for the period 5,760,000 ---------------- Total shareholders' equity attributable to minority interests 681,268,000 ================ Total shareholders' equity 2,100,171,000 ================ B. PROVISIONS FOR RISKS AND CHARGES Pensions and similar obligations 7,829,000 Taxes 365,588,000 Other 43,519,000 ---------------- Total provisions for risks and charges 416,936,000 ================ C. EMPLOYEE SEVERANCE INDEMNITIES 61,863,000 ================ D. ACCOUNTS PAYABLE Debenture loans maturing within 12 months 0 Debenture loans maturing beyond 12 months 258,229,000 Convertible bonds maturing beyond 12 months 1,184,400,000 Bank debt payable within 12 months 1,245,768,000 Bank debt payable beyond 12 months 2,658,761,000 Other lenders within 12 months 115,625,000 Other lenders beyond 12 months 245,416,000 Advances received (due within 12 months) 2,896,000 Trade within 12 months 1,071,852,000 Trade beyond 12 months 23,166,000 Securities issued maturing within 12 months 7,779,000 Securities issued maturing beyond 12 months 2,628,000 Subsidiaries within 12 months 79,000 Associated companies within 12 months 32,844,000 Parent companies within 12 months 9,219,000 Parent companies beyond 12 months 2,500,000 Taxes within 12 months 106,404,000 Taxes beyond 12 months 43,107,000 Social security and national insurance contributions within 12 months 20,716,000 Social security and national insurance contributions beyond 12 months 978,000 Other accounts payable within 12 months 118,613,000 Other accounts payable beyond 12 months 19,041,000 ---------------- Total accounts payable 7,170,021,000 ================ E. ACCRUED LIABILITIES AND DEFERRED INCOME Accrued liabilities and deferred income 462,513,000 ================ Total liabilities and shareholders' equity 10,211,504,000 ================ ----------------------------------------------------------------- [00003] PARENT COMPANY'S DECONSOLIDATED JUNE 30 BALANCE SHEET ----------------------------------------------------------------- Parmalat Finanziaria Spa DECONSOLIDATED PARENT COMPANY BALANCE SHEET At June 30, 2003 (in euros) A. UNPAID SHARE CAPITAL 0 ================ B. FIXED ASSETS I. Intangible fixed assets Start-up and expansion costs 24,330 ================ II. Tangible fixed assets Other assets 26,425 ================ III. Long-term financial assets Investments in: - subsidiaries 915,262,397 - associated companies 523,344 ---------------- Total investments 915,785,741 Accounts receivable: - others 15,816 Other securities 518,884 ---------------- Total long-term financial assets 916,320,441 ================ Total fixed assets 916,371,196 ================ C. CURRENT ASSETS I. Inventory 0 ================ II. Accounts receivable Subsidiaries within 12 months 1,074,089,252 Subsidiaries beyond 12 months 0 Others 5,975,456 ---------------- Total accounts receivable 1,080,064,708 ================ III. Current asset investments 0 ================ IV. Cash on hand and at banks Bank and post office deposits 30,944 Cash on hand 1,551 ---------------- Total cash on hand and at banks 32,495 ================ Total current assets 1,080,097,203 ================ D. ACCRUED INCOME AND PREPAID EXPENSES Accrued income and prepaid expenses 5,350,513 ================ Total assets 2,001,818,912 ================ LIABILITIES AND SHAREHOLDERS' EQUITY A. SHAREHOLDERS' EQUITY Share capital 815,669,721 Share premium reserve 71,880,410 Legal reserve 9,355,510 Other reserves: extraordinary reserve 33,086,557 Net profit for the year 0 Net profit for the period 10,040,297 ---------------- Total shareholders' equity 940,032,495 ================ B. PROVISIONS FOR RISKS AND CHARGES Other 246,386 ================ C. EMPLOYEE SEVERANCE INDEMNITIES 226,915 ================ D. ACCOUNTS PAYABLE Debenture loans maturing within 12 months 0 Debenture loans maturing beyond 12 months 258,228,450 Bank debt payable within 12 months 3,075,496 Trade 1,192,268 Subsidiaries within 12 months 734,814,272 Subsidiaries beyond 12 months 54,751,371 Associated companies within 12 months 0 Parent companies within 12 months 2,837,257 Taxes 1,532,901 Social security and national insurance contributions 37,689 Other accounts payable 258,160 ---------------- Total accounts payable 1,056,727,864 ================ E. ACCRUED LIABILITIES AND DEFERRED INCOME Accrued liabilities and deferred income 4,585,252 ================ Total liabilities 1,061,786,417 ================ Total liabilities and shareholders' equity 2,001,818,912 ================ ----------------------------------------------------------------- [00004] COMPANY'S PRESS RELEASE ANNOUNCING BANKRUPTCY FILING ----------------------------------------------------------------- | PARMALAT: ADMISSION TO | PARMALAT: RICHIESTA EXTRAORDINARY ADMINISTRATION | AMMINISTRAZIONE STRAORDINARI REQUESTED | | Milan, Dec. 24 -- | Milano, 24 dicembre -- Parmalat Finanziaria SpA | Parmalat Finanziaria SpA communicates that its | comunica che la controllata subsidiary Parmalat SpA, | Parmalat SpA, in seguito a following the resolutions | quanto deliberato taken at the Extraordinary | dall'Assemblea straordinaria Shareholder Meeting of | dei Soci della stessa Parmalat SpA held on 23 | Parmalat SpA tenutasi il 23 December, 2003, has filed with | dicembre 2003, ha richiesto the Minister of Productive | con istanza motivata al Activities and the Court of | ministro delle Attivit Parma, for an admission to | Produttive, dandone the extraordinary | contestuale comunicazione al administration procedure by | Tribunale di Parma, means of economic and | l'ammissione alla procedura financial restructuring, as | di amministrazione referred to in the | straordinaria tramite la Legislative Decree on urgent | ristrutturazione economica di measures for the | cui al Decreto Legge restructuring of major | approvato ieri dal Consiglio companies approved yesterday | dei Ministri relativo a by the Italian Cabinet. The | misure urgenti per la decree is in the process of | ristrutturazione delle grandi being published in the | imprese, in corso di Official Gazette. | pubblicazione nella Gazzetta | Ufficiale. ----------------------------------------------------------------- [00005] MINISTER OF INDUSTRY TAPS ENRICO BONDI AS COMMISSIONER ----------------------------------------------------------------- MARZANO NOMINATES BONDI | MARZANO NOMINA BONDI SPECIAL COMMISSIONER | COMMISSARIO STRAORDINARIO FOR PARMALAT | PARMALAT | Rome, 24 December -- The | Roma, 24 dicembre -- Productive Activities Minister, | Il Ministro delle Attivita Antonio Marzano, pursuant to | Produttive, Antonio Marzano, the law for the industrial | ai sensi del decreto legge restructuring of companies in | per la ristrutturazione crisis, has today signed a | industriale delle aziende in decree nominating and | crisi, ha oggi firmato il appointing Dr. Enrico Bondi | decreto di nomina del to serve as the special | commissario straordinario commissioner in connection with | per la ristrutturazione the restructuring of Parmalat. | della Parmalat, nella persona | del dott. Enrico Bondi. ----------------------------------------------------------------- [00006] SECURED NOTEHOLDERS MOVE TO WIND-UP TWO CAYMAN SPVs ----------------------------------------------------------------- NEW YORK, New York -- December 24, 2003 -- Jefferson-Pilot Life Insurance Company, Monumental Life Insurance Company, New York Life Insurance and Annuity Corporation, Principal Life Insurance Company, Transamerica Occidental Life Insurance Company and Transamerica Life Insurance Company, as Noteholders of Food Holdings Limited and Dairy Holding Limited, Cayman Island special-purpose vehicles established by Parmalat S.p.A., filed winding up petitions against Food and Dairy in the Grand Court of the Cayman Islands this morning. The Food Holdings notes matured on December 17, 2003 and the Dairy Holdings notes matured on December 22, 2003, and neither series has been repaid. The petitioning creditors have asked the Court to appoint Joint Provisional Liquidators for the purpose of taking control of Food and Dairy and their assets in order to protect the Noteholders' secured interests. The claims of the Noteholders are guaranteed by Parmalat S.p.A. This action by the Noteholders was taken in light of the uncertainties surrounding Parmalat's commencement of its Italian proceedings, as well as the need to protect the assets of Food and Dairy, including their claims against Parmalat Capital Finance Limited, also based in the Cayman Islands. The Noteholders emphasized that this action in the Cayman Islands was not intended to impede the efforts of Parmalat S.p.A to preserve its business and develop a plan for the repayment of its creditors, including the Noteholders. The Noteholders have informed Enrico Bondi and his advisors of the Noteholders' desire to work with them to maximize recoveries for the benefit of the Noteholders and other creditors. The Noteholders have retained Cadwalader Wickersham & Taft LLP as independent legal counsel. Bruce Zirinsky, Esq., leads the Cadwalader team of lawyers. Ernst & Young Corporate Finance LLC provides the Noteholders with financial advisory services. ----------------------------------------------------------------- [00007] CLESA, S.A., DISTANCES ITSELF FROM PARMALAT PARENT ----------------------------------------------------------------- Clesa, S.A., 95% owned by Arilca, S.A., and 99% owned, in turn, by Parmalat S.p.A., published a statement this week at http://www.clesa.es/comunicado.htm stating that the Spanish unit's operations and financing are independent of its troubled parent. Clesa says it has financial autonomy and Parmalat, SpA, has no greater claim on the unit's assets than its equity interest in the business. Clesa confirms that it is fulfilling all of its commitments to suppliers, vendors, creditors and employees. ----------------------------------------------------------------- [00008] GRANT THORNTON SAYS IT WAS A VICTIM OF FRAUD ----------------------------------------------------------------- Grant Thornton says that had no role in the financial fraud at Parmalat and that it was hoodwinked by company management. Grant Thornton S.p.A. audited Bonlat's 2002 accounts but has now learned that an audit confirmation letter from Bank of America confirming a 4-billion euro deposit in the Cayman Islands was a fake. "Grant Thornton S.p.A. declares that it never conceived nor collaborated in carrying out any accounting or tax activity to mask the real administrative or financial situation at the Parmalat group," the auditing firm says in a series of three announcements affirming that it acted properly: Comunicato 19.12.2003 -- http://bankrupt.com/misc/comunicato191203.pdf Comunicato 20.12.2003 -- http://bankrupt.com/misc/Comunicato201203.pdf Comunicato 23.12.2003 -- http://bankrupt.com/misc/comunicato231203.pdf "If anything," Grant Thornton S.p.A. chairman Lorenzo Penca says," we are the ones who have been the victims of serious fraud." Grant Thornton has instructed its lawyers to take whatever steps were necessary to protect its name and reputation. ----------------------------------------------------------------- [00009] PARMA COURT DECLARES PARMALAT S.p.A. INSOLVENT ----------------------------------------------------------------- Acting on an expedited basis as the Company's behest, Judge Vittorio Zanichelli convened an in camera hearing Saturday afternoon in the Parma Court's Bankruptcy Section (Tribunale di Parma, Sezione Fallimentare) to review Parmalat S.p.A.'s request for protection from creditors. Parmalat CEO Enrico Bondi, company lawyer Umberto Tracanella and a prosecutor investigating the underlying financial fraud, attended the hearing. Mr. Bondi presented Judge Zanichelli with a non-public report about the company's assets. Parmalat's petition for a temporary breathing spell is made pursuant to a new law enacted on Dec. 23 tailored for troubled companies with more than 1,000 workers and owing more than 1 billion euros six months. Parmalat's Petition "is protected by the Law and it may not be divulged or published," a creditors' attorney in Milan explains. The facts on which Parmalat bases its request for protection and any testimony Enrico Bondi may have proffered in support of that relief are secret. One prominent U.S. attorney representing bondholder interests confirms that his firm hasn't seen definitive court documents from the Italian courts and says he's not sure they will be made public. "Welcome to Italy," that attorney quips. Judge Zanichelli's order entered Saturday: * finds that Parmalat S.p.A. is insolvent; * finds that the company qualifies to enter into an Extraordinary Administration (Amministrazione straordinaria) proceeding under Italian law; * appoints Enrico Bondi to serve as a so-called Commissioner in the Amministrazione straordinaria proceeding and gives him the authority to: -- operate the business in the ordinary course, and -- incur new debts to operate the business and repay those new obligations in the ordinary course; and * restrains creditors from commencing or continuing any action to collect a debt arising prior to December 27, 2003. A Surveillance Committee (Comitato di Sorveglianza) composed of a small number of creditors will be appointed in the near future. Over time Mr. Bondi and that Committee are expected to craft a Reorganization Plan (Piano di risanamento) that will sell unproductive assets, restructure core assets, recover assets that improperly left the company, marshall the value of the estate, and distribute that value to creditors based on their priority under applicable law. The restructuring proceeding is subject to continuing supervision by the Ministry of Industry and Commerce. *** End of Issue No. 1 ***