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February 7, 2007
name='1'>Senate Banking Committee to Hold Hearing Today on Predatory
Lending
The Senate Banking
Committee will hold a hearing today focused on predatory lending
practices and home foreclosures at 10 a.m. in 216 Hart Senate Office
Building,
size='3'>CongressDaily reported today. Among
those scheduled to testify are Rev. Jesse Jackson and NAACP Executive
Director Hilary Shelton, mortgage and lending industry representatives,
the AARP and consumers.
href='http://banking.senate.gov/index.cfm?Fuseaction=Hearings.Detail&HearingID=248'>Click
here to view the Senate Banking Committee’s hearing page to
watch the proceeding live via Webcast.
Airlines
name='2'>Northwest Readies Chapter 11 Exit as
w:st='on'>
size='3'>Loss
face='Times New Roman'
size='3'>Narrows
Northwest Airlines Corp.
reported a narrower fourth-quarter loss and said it is on track to
emerge from bankruptcy reorganization by midyear, the
face='Times New Roman' size='3'>Wall Street Journal
size='3'>reported yesterday. The Eagan, Minn.-based airline is expected
to file its reorganization plan on Feb. 15. It reported a fourth-quarter
net loss of $267 million, compared with a loss of $1.3 billion in the
year-earlier quarter. Operating revenue rose 2.2 percent to $2.98
billion. For all of 2006, Northwest posted a net loss of $2.8 billion,
wider than its $2.56 billion loss in 2005. Excluding special charges for
reorganization, the airline turned the corner to a profit last year,
earning $301 million, compared with an operating loss of $1.38 billion a
href='http://online.wsj.com/article/SB117078887779099819.html?mod=us_business_whats_news'>Read
more. (Registration required.)
name='3'>Delta Says It Resolved All Objections to Disclosure
Statement
Delta Air Lines Inc. said
that it has resolved all the objections to the disclosure statement to
its reorganization plan, the Associated Press reported yesterday. Last
month, several communities and the operator of a
w:st='on'>Puerto
Rico
disclosure statement. Among them,
w:st='on'>Los
Angeles
reorganization plan couldn't be approved because of undue authority it
gave the company to reject certain leases. Other objectors
included
size='3'>Denver
w:st='on'>Palm Beach
County
w:st='on'>
size='3'>Fla.
Rico's
face='Times New Roman' size='3'>Luis
size='3'>Munoz
face='Times New Roman' size='3'>Marin
size='3'>International
w:st='on'>
size='3'>Airport
ad hoc committee of creditors and a few banks.
href='http://news.cincypost.com/apps/pbcs.dll/article?AID=/20070207/BIZ/702070311'>Read
more.
name='4'>Allied Bids to Cancel Labor Contracts
Allied Holdings Inc.
asked the U.S. Bankruptcy Court in
w:st='on'>
size='3'>Atlanta on Friday
for approval to cancel its labor union contracts, hoping the move will
push the auto supplier closer to emerging from chapter 11,
Bankruptcy Law360
reported yesterday. In its motion, the company argued
that it needs to save another $65 million in yearly costs before it can
emerge from bankruptcy and hopes to achieve the savings by cutting labor
costs by 2.8 percent over the next five years. The International
Brotherhood of Teamsters, which represents over 3,600 of Allied’s
workers, has consistently opposed the move and has shown no signs of
conceding thus far.
href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=18036'>Read
more. (Registration required.)
name='5'>Asbestos Concerns Sink Congoleum Bankruptcy
Plan
Bankruptcy Judge
Kathryn C. Ferguson
rejected Congoleum Corp.’s reorganization plan last
week, citing its unequal treatment of claimants and other flaws,
BusinessInsurance.com reported yesterday. This is the company’s
tenth attempt to have its reorganization plan approved as Congoleum
seeks to resolve hundreds of millions of dollars of asbestos claims. At
the same time, the judge turned away an alternate plan offered by units
of CNA Financial Corp. and rejected that plan’s creation of a
class of insurance company claimants in the bankruptcy proceeding.
Congoleum, a
size='3'>Mercerville
flooring manufacturer, said it will return to negotiations with asbestos
claimants and other parties, and hopes to have a revised plan ready by
the end of September.
href='http://www.businessinsurance.com/cgi-bin/news.pl?newsId=9453&print=Y'>Read
more.
name='6'>Collapsed Hedge Fund Requests Extension
The Bayou Group hedge
fund has asked a bankruptcy court for more time to file its
reorganization plan, hoping it can recoup more than $135 million in
investments it lost before it collapsed,
size='3'>Bankruptcy Law360 reported yesterday.
Asking a bankruptcy court for a six-month extension of its exclusivity
period, lawyers for Bayou said the extra time was needed to manage the
102 lawsuits it had launched to recover profits from investors who
withdrew their investments after they were allegedly tipped off about
the fund’s failing fortunes. Bayou argued in its motion Friday
that losing its exclusive control would materially damage the company
and its creditors, creating a “two-front assault” with
competing plans from creditors adding to the pile of existing
suits.
href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=18095'>Read
more. (Registration required.)
name='7'>Adelphia Bondholders' Appeal Keeps Plan on
Hold
Adelphia Communications
Corp.’s bondholders appeared before an appellate court
to appeal a district
court’s decision that would require them to post a $1.3 billion
bond in exchange for a review of the cable provider's bankruptcy
case, Bankruptcy
Law360 reported yesterday. In a hearing before
the U.S. Court of Appeals for the Second Circuit, lawyers for the
bondholders reportedly argued that the bond required by U.S. District
Court Judge Shira A. Scheindlin to offset any harm to Adelphia and the
other creditors was too high. Judge Scheindlin granted the
bondholders’ request for a stay in the case on Jan. 24 after the
group argued that the bankruptcy judge had been wrong to approve
Adelphia’s reorganization plan earlier that month. However, Judge
Scheindlin required the bond in case the district court’s stay
diminished the value of the bankruptcy estate, causing harm to the
debtors and creditors.
href='http://bankruptcy.law360.com/secure/ViewArticle.aspx?Id=18031'>Read
more. (Registration required.)
name='8'>Werner Creditors Receive Extension
A bankruptcy judge has
given Werner Co.'s financial advisor and unsecured creditors’
committee more time to resolve a dispute over $1.39 million in fees, the
Associated Press reported yesterday. Judge Kevin J. Carey of the U.S.
Bankruptcy Court in
w:st='on'>
size='3'>Wilmington,
w:st='on'>
size='3'>Del.
size='3'>, on Monday approved an extension to Feb. 21 for Rothschild
Inc. and Werner’s creditors’ committee to settle the
disagreement. Werner filed for chapter 11 protection on June 12, listing
assets of $201 million and debts of $473.4 million. Its bankruptcy
filing was prompted by several factors, including a heavy debt load and
the high cost of aluminum and other raw materials. At issue now is
Rothschild's request last September to be paid $1.39 million for
services it provided Werner from June through August.
href='http://biz.yahoo.com/ap/070206/werner_bankruptcy.html?.v=1'>Read
more.
SEC
Files Suit in Options Back-Dating Case
Charges were filed
against two former top executives of a military contractor that
allegedly enriched themselves and others in a five-year scheme to
manipulate the timing of stock option grants, Reuters reported
yesterday. The Securities and Exchange Commission filed a civil lawsuit
in federal court in
w:st='on'>St.
Louis
Gerhardt, former chief financial officer of Engineered Support Systems,
and Steven J. Landmann, the former controller. Employees and directors
of Engineered Support received some $20 million in unauthorized
compensation as a result of the backdating, while Gerhardt and Landmann
reaped $1.9 million and $518,972, respectively, according to the S.E.C.
Landmann agreed in a settlement with the agency to pay a $259,486 fine
and $627,071 in restitution plus interest.
name='10'>“Exurbs” Hardest Hit in Recent Housing
Slump
While the
size='3'>U.S.
size='3'>housing downturn has depressed once-thriving real estate
markets around the nation, the distant suburbs of major cities, or
“exurbs,” have suffered the most abrupt market correction,
Reuters reported yesterday. Home construction in the exurbs has slowed
and prices and sales have fallen more than those of close-in suburban
neighbors since a five-year
w:st='on'>
size='3'>U.S.
size='3'>housing boom ended in the summer of 2005. Average home prices
in
size='3'>Loudon County
size='3'>Va.
of
size='3'>Washington
w:st='on'>
size='3'>D.C.
in 2006, while
face='Times New Roman' size='3'>Arlington County
size='3'>,
size='3'>Va.
outside of the nation's capital, saw a price decline of only about 2
percent, according to the Northern Virginia Association of Realtors. The
same holds true for
w:st='on'>
size='3'>California
exurban housing markets have softened more than those close to urban
centers. Home prices in
w:st='on'>Los
Angeles
modest 5.8 percent in December from a year earlier, while sales were
down 14.5 percent, the California Association of Realtors said.
href='http://money.cnn.com/2007/02/06/real_estate/exurbs_housing.reut/index.htm?section=money_email_alerts'>Read
more.
name='11'>TROUBLED COMPANIES IN THE NEWS
1000’s of companies lose
money or experience some form of difficulty each
quarter.
The business news
articles below are taken from the
size='3'>Daily Summary of Troubled & Fast Growing U.S. Companies and
Other Business News published by Bastien
Financial Publications.
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size='3'>your name, company name, address, phone and fax.
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size='3'>Building Materials Holding Corp.,
a
size='3'>San Francisco, Ca.
operator of retail building-materials centers, reported its fourth
quarter net income sank 87%--to $4.5 million. Revenue declined 26%--to
$608 million. For the year, its net income fell 21%--to $102 million,
including impairment charges of $2.2 million. Revenue rose 11%--to $3.2
billion.
size='3'>Family Dollar Stores Inc., a
Charlotte, N.C.-based retail chain, asked a federal judge not to
classify a current legal battle regarding overtime pay as a
collective-action lawsuit, insisting that it obeys labor laws.
Family Dollar has won at least two cases over overtime pay but last year
it lost one that resulted in a more than $33 million judgment against
it.
size='3'>Lear Corp.'s stock price rose 11% on
speculation that investor Carl Icahn's $2.75 billion buyout offer might
spur other bids for the Southfield, Mi. auto-parts firm. Mr.
Icahn, who boosted his interest in Lear last fall to 16% and won a seat
on the board, often buys up large positions in companies that he sees as
undervalued and then tries to force changes in management or
redirections in strategy. Amid tough times in the
automotive-supply sector, due to lower production among
size='3'>U.S.
size='3'>automakers, Lear has been trying to restructure. It has entered
into joint ventures with financier Wilbur Ross that calls for Lear to
hand over its plastics-interiors operations. On the positive side,
Lear recently increased its outlook for core operating profit this year,
thanks partly to the beneficial effects of cutting costs thanks to
closing plants and other moves.
size='3'>Majesco Entertainment Co.'s stock
price fell nearly 5% after the Edison, N.J. publisher of videogames
included in its annual report a warning from auditors that raises doubt
about the company's ability to continue as a going
concern.
size='3'>Rewards Network Inc., Chicago, Il.,
reported a fourth quarter net loss of $19.2 million. Revenue declined
22%--to $17.6 million. For the year, it lost $15.2 million on an 8%
increase in revenue--to $83.5 million. The quarter and year included
litigation-settlement charges of $29.4 million and $36.4 million
respectively. Rewards Networks provides a user-rewards program that
offers membership discounts on hotels and restaurants.
size='3'>Tribune Co.'s recent auction yielded
no attractive bids, and in fact the only offer considered even credible
came from the
size='3'>Chandler
size='3'>California
Yet the
size='3'>Chandlers
the
size='3'>Il
are still trying to press their plan for the Tribune to accept the
buyout offer, which would be followed up by a spinoff of the
broadcasting operations. With Tribune still cool about the bid,
the
size='3'>are now considering whether to wage a proxy battle to remove
two directors from Tribune's board. However, some observers consider
the
size='3'>move a desperate one, not in the best interests of Tribune
shareholders and unlikely to succeed.