|
Crop Insurance Conference Finalized; Bankruptcy Bill Not
Added
House and Senate conferees on the crop insurance legislation wrapped up
their work on the bill late Wednesday and have cleared the bill for
final action in both chambers, to occur as early as today. But the
bankruptcy reform bill isn't included in the package. Republican
leaders had identified the politically popular crop insurance conference
report as a possible vehicle for the bankruptcy bill, but the conferees
were apparently not interested in having their bill saddled with the
baggage of bankruptcy. Conferees instead professed a desire for a
'clean' conference report, without unrelated material from another
committee. In addition, the CQ Daily Monitor reported that
negotiators were unable to resolve their issues in time to attach the
bill to the crop insurance measure, even though Republicans held a
meeting late yesterday to iron out the homestead exemption terms,
modifying the agreement to set a federal cap of $100,000 for people who
have owned their homes for less than two years.
Once the crop insurance conference report is presented, it cannot be
amended on the House or Senate floor; thus this potential vehicle for
the bankruptcy bill is now unavailable. The other talked-about vehicle -
the electronic signatures bill conference report - may also be ready for
action soon. The proponents of this bill include some
of the same financial services industry players as in the bankruptcy
arena, but it's not at all clear that this vehicle will be a good fit
either.
House Banking and Financial Services Committee Discusses
Mortgage-lending Abuses
The House Committee on Banking and Financial Services held a hearing on
mortgage-lending abuses yesterday. Led by Chairman James A. Leach
(R-Iowa), the three panels discussed anti-predatory lending precepts.
Members of the panels gave testimonies, including George J.
Wallace, a partner in the firm of Eckert Seamans Cherin & Mellot,
for the American Financial Service Association. You can read the full
text of the testimonies at
HREF='http://www.house.gov/banking/52400wit.htm'
TARGET='window2'>www.house.gov/banking/52400wit.htm. Chairman Leach
addresses precepts of predatory practices at
HREF='http://www.house.gov/banking/52400lea.htm'
TARGET='window2'>www.house.gov/banking/52400lea.htm.
AHCA Reports Medicare Cuts Are Crippling Nursing Homes
According to a study released yesterday by the American Health Care
Association (AHCA), a nursing home industry group, the 1997 Balanced
Budget Act reduced Medicare nursing home spending by far more than
Congress intended, and even the money restored by the 1999 Balanced
Budget Refinement Act has not helped the situation, Reuters reported.
The analysis, conducted by the Lewin Group, predicted that by the year
2002, Medicare spending for skilled nursing facility (SNF) services will
be $12.2 billion less than was projected when the 1997 law was passed,
even taking into account the effects of last year's restorations. The
cuts did not merely slow down the increase in Medicare nursing home
spending, the study found, but resulted in net reductions of from $13.6
billion in 1998 to $12.3 billion in 1999 - a 9.6 percent drop. As a
consequence, the study said, not only has the nursing home industry
found it more difficult to obtain working capital, but more than 1,600
skilled nursing providers have declared bankruptcy since the Balanced
Budget Act was implemented. 'Traveling outside of Washington on a
regular basis to assess this very real funding problem, I'm seeing
first-hand, in state after state, that caregivers are being adversely
impacted and exposed to excessive levels of risk and uncertainty,' said
Dr. Charles Roadman II, president and chief executive officer of the
AHCA. 'This study demonstrates what patients, their families and
caregivers already know: There is a crisis in Medicare funding for
skilled nursing care, and it's time for the Clinton/Gore Administration
to implement congressional budget law in a manner that corrects the
significant level of underspending now in practice. This administration
has presided over skilled nuring care cuts almost double what Congress
intended. It must fix this problem because our country is now faced with
an increase in requirements for care and a decrease in critical
resources to provide it.'
The AHCA also emphasized that much of the problem is due to the way
the Health Care Financing Administration has implemented the law,
particularly in the implementation of Medicare's prospective payment
system for nursing homes, which the study said has failed to provide
adequate payments for very sick patients, in some cases making it
difficult for them to find care. 'As a physician, I believe it's
unconscionable to put millions of our oldest and most vulnerable
Americans at risk, not to mention our caregivers,' said Roadman. 'The
failure to act promptly will only cause this crisis to escalate, to the
major detriment of elderly Americans to whom Medicare's promise means
the most.'
Ventas/Vencor Form Tax Agreement
Ventas Inc., a real estate investment trust, formed a 'tax stipulation'
agreement with health care company Vencor Inc. that includes $26.6
million in refunds drawn by Ventas from a 1998 tax return, according to
a Dow Jones newswire report. The agreement follows negotiations with
Vencor over certain disputed refunds, Ventas said yesterday. Vencor, the
primary tenant of Ventas, filed for bankruptcy with several of its units
on Sept. 13. The agreement calls for each company to hold tax proceeds
received on or after Sept. 13 in segregated interest-bearing accounts
and contains notice provisions related to the withdrawal of funds from
the aforementioned accounts by either company. Each company will reserve
all rights and claims to amounts covered by the agreement, Ventas said.
In April, Vencor reported that its lenders agreed to amend its
debtor-in-possession financing, primarily to revise a financial covenant
regarding minimum net amount of accounts receivable.
Excelsior-Henderson Announces Disclosure Statement
Approval
Excelsior-Henderson Motorcycle Manufacturing Co., Belle Plaine, Minn.,
announced yesterday that the bankruptcy court had approved the
disclosure statement to be distributed to creditors in connection with
its proposed reorganization plan, according to a newswire report. The
plan would enable the company to reorganize and obtain the required
additional equity funding. The approved disclosure statement also
reflects the agreement reached with the state of Minnesota regarding a
loan made by the Minnesota Agricultural and Economic Development
Authority. If the plan is confirmed, the Authority will receive full
principal payments over a period not to exceed nine years. Other secured
creditors will receive restructured notes. Unsecured creditors will
receive a pro rata distribution of cash and the right to receive an
annuity stream of certain royalties based on the company's gross sales,
subject to a maximum amount. 'We believe the proposed plan of
reorganization represents the best available alternative for the company
and its creditors,' said company Co-founders and Chief Executive
Officers Dan and Dave Hanlon. 'It is also a good alternative for the
surrounding community as we expect manufacturing operations will resume
in Belle Plaine. However, it is highly unfortunate that all equity
shareholders, common and preferred, including ourselves, lost our entire
equity stake. There are a lot of shareholders and motorcyclists who have
believed in us and the company, and it is unfortunate that we are all
sacrificing.' The company filed for bankruptcy in December after the
preferred stockholders investment group did not fund an expected
commitment set forth in a letter of intent.
Advanced Wireless Systems to Acquire Digital Wireless
Systems
Advanced Wireless Systems Inc. announced yesterday that its
reorganization plan was confirmed Tuesday in the Federal Bankruptcy
Court for the Middle District of Tennessee, according to a newswire
report. Under the plan, Advanced Wireless will acquire all assets of
Digital Wireless in exchange for Advanced Wireless common stock and
stock purchase warrants, which will be distributed to Digital Wireless'
creditors and equity security holders. The Digital Wireless acquisition
will increase Advanced Wireless' broadband wireless holdings by more
than 700 percent and will triple its monthly gross revenues. The closing
of the sale is expected to occur at the end of June. Digital Wireless
owns and/or leases multiple broadband MMDS frequencies in each of its
four markets in Baton Rouge, La.; Shreveport/Bossier City, La.;
Clarksville, Tenn.; and Reading, Pa.
New World Completes Acquisition of New York Bagel Stores
New World Coffee-Manhattan Bagel Inc., which franchises, licenses or
owns stores under its four brands in 28 states including Washington,
D.C., announced today that it has completed the acquisition of the
leases and store operating assets of 17 company-owned New York Bagel
stores in Oklahoma and Kansas from bankrupt New York Bagel Enterprises
Inc., according to a newswire report. New World intends to sell these
stores to third parties as Manhattan Bagel-branded franchised locations.
In addition, New World acquired Bank of America's lien rights to
substantially all of the remaining assets of New York Bagel Enterprises
and its affiliate, Lots 'A Bagels Inc., which also is in chapter 11. In
addition to the leases, store operating assets and lien rights, New
World also acquired all rights to the New York Bagel tradename and
trademarks, and may take ownership of New York Bagel Enterprises Inc.'s
rights under its franchise agreements with approximately 13 franchisees.
'The New York Bagel acquisition represents the latest phase of our
growth plan,' said Ramin Kamfar, New World's chairman and chief
executive officer. 'In addition to expanding to three new Midwestern
markets, these transactions solidify our position as the No. 1
franchisor in the industry and further leverage our investment in
Manhattan Bagel's infrastructure.'
MicroAge Inc. Receives Final Financing Approval
According to a newswire report, Micro Age Inc. announced yesterday that
it has received final bankruptcy court approval of its $210 million
debtor-in-possession (DIP) financing agreement. Under the DIP agreement,
a group of financial institutions led by Citibank N.A. will grant
post-petition financing to MicroAge to purchase goods and services, as
well as subsidize the company's ongoing operations during its
restructuring under chapter 11. 'The DIP financing facility will provide
adequate financial resources to fund our post-petition vendor and
employee obligations and other operating requirements as MicroAge moves
forward with its restructuring,' said Jeffrey D. McKeever, MicroAge
chairman and chief executive officer. MicroAge Inc., a Fortune 500
company, provides business technology solutions and infrastructure
services. The revised terms of the agreement also provide for greater
availability of funds for product purchases and reduced fees. The
company filed chapter 11 last month.
size='3'>Thanks for visiting Today's Bankruptcy Headlines.
New
articles are posted here each business day.
|
