February 132007

 

Sen.
Dodd Signals Slow Approach to Regulating Hedge Funds

Senate Banking Chairman
Christopher Dodd (D-Conn.) is proposing a cautious approach toward
regulating trillion-dollar hedge funds, saying over-regulation might
damage the 'tremendously valuable' industry, but he questioned whether
pension funds should use investments in such funds to try to boost
returns, Congress
Daily reported yesterday. Congress is
increasingly turning its attention to hedge funds, which can generate
large returns as well as losses, and are attracting more varied
clientele such as pension funds and university endowments. Dodd noted
that the industry has shown signs of maturity, such as tightening
investor standards, that were apparent when last year's $6 billion loss
from Amaranth Advisors caused only a 'blip' in the equity markets. While

Dodd signaled caution over pension fund investments in hedge funds, he
added that most hedge fund managers are careful about pension fund
participation, with very few allowing major investments. Dodd said the
issue might play out on discussions on the Employee Retirement Income
Security Act, which would be under the jurisdiction of the Health,
Education, Labor and Pensions Committee.

name='2'>Foamex Emerges from Bankruptcy

Foamex International Inc.

said that its reorganization plan has become effective and the
company has emerged from chapter 11 protection, the
face='Times New Roman' size='3'>Philadelphia Business Journal

reported yesterday. The Linwood,
w:st='on'>
size='3'>Pa., maker of
foam used in mattresses and vehicles filed for bankruptcy protection in
September 2005. Foamex also said that Gregory J. Christian, who served
as executive vice president, chief restructuring officer and, was chief
administrative officer and general counsel for Foamex, was named
president. Former President Thomas E. Chorman resigned from the company
in June by mutual agreement with the board.

Court

Approves Adelphia's Chapter 11 Plan

U.S. District Court Judge Shira

A. Scheindlin approved Adelphia CommunicationsCorp.’s
reorganization plan, moving the cable provider one step closer to
emerging from chapter 11,
size='3'>Bankruptcy Law360 reported yesterday.

Judge Sheindlin, who put the case on hold on Jan. 24 after a group of
Adelphia’s bondholders appealed the bankruptcy court’s
approval of the plan, lifted the stay she had placed on the case in
light of an appellate court’s decision on Friday. In that case,
the U.S. Court of Appeals for the Second Circuit denied the request by
Adelphia’s bondholders to overturn Judge Scheindlin’s
ruling,  which required them to post a $1.3
billion bond in exchange for a stay pending the review of the cable
provider’s bankruptcy case. Judge Scheindlin required the bond in
order to offset any harm to Adelphia and the other creditors. 

href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=18464'>Read

more . (Registration required.)

name='4'>Comair and Pilots
face='Times New Roman' size='3'>Union
size='3'>Reach Agreement

Comair and the union
representing its pilots reached a tentative agreement today,
forestalling a plan by the regional airline to impose wage cuts and
other concessions, the Associated Press reported today. The company has
agreed to delay implementation of the concessions unless the agreement
is not ratified by March 4, Comair spokeswoman Kate Marx said. The
proposal must now be reviewed by union leadership before going before
the 1,500-member union for a vote, said Air Line Pilots Association
union spokesman Paul Denke. Neither Comair nor the union were releasing
details of the proposal. The Erlanger, Ky.-based Comair was planning to
impose $15.8 million in concessions if an agreement was not
reached. 

href='http://www.nytimes.com/aponline/business/AP-Comair-Pilots.html'>Read

more.

name='5'>Commentary: Judges Cast Skeptical Eye on Asbestos
Bankruptcy Cases

Asbestos bankruptcies
have become a favorite trial-lawyer scam, but judges have been more
vigilant about policing such fraud in their courts as two more federal
judges have issued opinions exposing these shakedowns, according to an
editorial in today’s
size='3'>Wall Street Journal. Bankruptcy
Judge Kathryn Ferguson ruled

that Congoleum's minimal contribution to the prepackaged bankruptcy
plan, as well as the special treatment that certain plaintiffs (and
lawyers) were getting in the plan, violated the Bankruptcy Code. Judge
Ferguson also granted Congoleum's insurers, who were slated to shoulder
most of the costs, standing to object. Then in December, Bankruptcy

Judge Judith
Fitzgerald ruled that W.R. Grace’s
insulation product, Zonolite Attic Insulation (ZAI), does not pose an
unreasonable risk of harm. Judge Fitzgerald noted that it wasn't enough
for trial lawyers to say that the insulation contained asbestos, and
that this asbestos could contaminate the air. The important point was
the level at which asbestos was released, and whether the level could
reasonably cause harm. 

href='http://online.wsj.com/article/SB117132769242206480.html?mod=opinion_main_review_and_outlooks'>Read

more.  (Registration required.)

name='6'>Auction Is Set for Air
w:st='on'>
size='3'>America

Air America Radio, the
liberal news and talk radio network, has won bankruptcy court approval
to sell its assets at an auction Friday, starting with a $4.25 million
bid from a consortium of purchasers formed by Stephen L. Green, the
chairman of SL Green Realty of New York, Dow Jones Newswires reported
yesterday. Bankruptcy Judge
size='3'>Robert D. Drain said on Friday that
the consortium could receive a $150,000 breakup fee if its offer was
topped at the auction. Competing bids, which must start at $4.6 million,

are due by Thursday with a 10 percent deposit. Bidding will increase in
increments of at least $50,000. A sale hearing will be held immediately
after the auction. The proposed sale, the filing said, will enable the
company to keep broadcasting. 

href='http://www.nytimes.com/2007/02/13/business/media/13radio.html?pagewanted=print'>Read

more.

name='7'>Florida Phone Company Files for Chapter 11

Though Trinsic Inc. has
tried just about everything to turn a profit since its debut as Z-Tel
Technologies in 1998, the company filed for chapter 11 protection when a

key lender threatened to cut off the Tampa, Fla.-based telephone
company's funding last week, the
size='3'>St. Petersburg Times reported today.
The company reported total assets of $27.6-million against debts of
$48.3-million. As conventional funding vanished, Trinsic turned in early

2005 to Thermo Credit LLC, a
w:st='on'>New
Orleans firm that buys
discounted receivables for cash. According to last week's bankruptcy
filing, however, even Thermo became 'uncomfortable' with Trinsic, whose
stock closed Monday at 7 cents per share. 

href='http://www.sptimes.com/2007/02/13/Business/Trinsic_files_for_Cha.shtml'>Read

more .

SEC
Seeks to Curtail Investor Suits

The Securities and
Exchange Commission (SEC) has begun to take steps on two fronts to
protect corporations, executives and accounting firms from investor
lawsuits that accuse them of fraud, the

size='3'>New York Times reported today. Last
Friday, the commission filed a little-noticed brief in the Supreme Court

urging the adoption of a legal standard that would make it harder for
shareholders to prevail in fraud lawsuits against publicly traded
companies and their executives. At the same time, the SEC’s chief
accountant, Conrad Hewitt, told a conference that it was considering
ways to protect accounting firms from large damage awards in cases
brought by investors and companies. 

href='http://www.nytimes.com/2007/02/13/washington/13sec.html?ref=business'>Read

more.

International

name='9'>Canadian Auto Parts Sector Tightens Its
Belt

The wrenching
restructuring of the North American auto industry has pushed employment
in
face='Times New Roman'
size='3'>Canada's

battered auto parts industry down 11 percent from its peak in 2003,
theToronto Globe and
Mail reported today. As of the end of
November, parts employment in
w:st='on'>
size='3'>Canada
size='3'>had slumped to 92,193, down from 103,413 in 2003, the lowest
annual number since 1998, according to research by DesRosiers Automotive

Consultants Inc. '2007 is going to be a tough year, but I think things
will improve after that,' said Gerry Fedchun, president of the
Automotive Parts Manufacturers Association, which represents auto
suppliers in Canada. One key, Fedchun said, will be the scope of
Chrysler's second restucturing plan, to be announced tomorrow. 

href='http://www.globeinvestor.com/servlet/story/GAM.20070213.RAUTO12/GIStory/'>Read

more.

name='10'>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. 

To begin receiving the COMPLETE

Daily e-Summary, that emails you information on over 70 such companies
each morning, email
face='Times New Roman' color='#0000ff'
size='3'>steve@creditnews.com

size='3'>your name, company name, address, phone and fax.
face='Times New 

Roman' size='3'> 

We’ll set you up within 24 hours.

Receive an ABI
member’s discount of 50% off the $500 annual subscription
fee.  Indicate “ABI CODE 27” in
your email.

size='3'>Affymetrix Inc., a
w:st='on'>
size='3'>Santa Clara,

w:st='on'>
size='3'>Calif.
size='3'>genetic-analysis and disease-research company, reported its
fourth quarter net income sank 72%--to $8.7 million. Revenue declined
6.5%--to $104 million. For the year, it lost $13.7 million on a 3%
revenue decline--to $355 million. The quarter and year included
restructuring charges of $3.5 million and $13.5 million
respectively.

size='3'>Artic Cat Inc., the

w:st='on'>
size='3'>Minnesota
size='3'>manufacturer of all-terrain vehicles, is cutting 65 jobs from
its payroll as part of its efforts to lower its cost structure in light
of the soft market for snowmobiles.

size='3'>Bookham Inc., the
w:st='on'>San
Jose,

face='Times New Roman' size='3'>Calif.
firm which integrates light processing functions of
optical networking components into silicon chips, reported a second
quarter net loss of $21.3 million on a 7% revenue decline—to $56.3

million.  This is nearly doubled the loss for the same period one
year earlier.

size='3'>Capstone Turbine Corp., the
Chatsworth, Calif. firm which makes the Capstone MicroTurbine, a power
generating system, reported a third quarter net loss of $8.4 million on
an 18% revenue decline—to $5.7 million.

size='3'>Concord Camera Corp. of

size='3'>Hollywood,
w:st='on'>
size='3'>Fla. reported a
second quarter net loss of $3.5 million on a 53% sales decline--to $19.3

million.

size='3'>Eddie Bauer Holdings Inc., the
troubled
face='Times New Roman' size='3'>Redmond
size='3'>,
size='3'>Wash. retailer
which recently saw shareholders reject the company’s efforts to
sell itself to two private equity firms, has seen its CEO resign. 
At least one industry analyst feels Eddie Bauer’s future seems
uncertain.

size='3'>SupportSoft Inc., the Redwood City,
Calif. firm whose web-based software identifies and repairs hardware and

software problems, reducing the need for technical support, reported a
fourth quarter net loss of $84,000 on a 10% revenue decline—to
$14.1 million.  For the year, the company reported a loss of $8.2
million on a 27% revenue decline—to $45 million.  The loss
for the quarter and year compare with income, for the same periods one
year earlier, of $1.1 million and $4.4 respectively.