Red Bluff Daily News

January 18, 2010

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DENVER — Affiliated Media Inc., the holding company for MediaNews Group, and its lenders have agreed on a plan to restruc- ture $930 million in debt, the Denver-based company announced on Friday. The agreement swaps debt for equity, retains the current management team and excludes all of the company's media proper- ties, which include the Daily News and Chico Enterprise-Record, accord- ing to the announcement. The plan will be imple- mented in the near future through a pre-packaged Chapter 11 bankruptcy fil- ing. "It gives us one of the strongest balance sheets in the industry," said Medi- aNews chairman and CEO William Dean Singleton. "It gives us breathing space to create a new model for the newspapers we publish." Because all of the com- pany's individual media properties will be excluded from the filing, advertisers, vendors, employees and subscribers will be unaf- fected, Singleton empha- sized. "For them it is business as usual," he said. The company is current on all vendor payments and has adequate cash to fund all operations. No layoffs or wage cuts are planned because of the reorganization, Singleton said. The company distrib- uted a press release and memo to staff at all of its properties late Friday. Senior lenders, who are owed about $590 million, will obtain a majority of the equity in the reorga- nized company and pro- portional shares of a small- er $150 million term-loan under the plan. That group, led by Bank of America, will appoint three of the company's seven board seats. Singleton and Medi- aNews President Joseph Lodovic will own 20 per- cent of the equity, with rights to additional shares in the future. They will appoint four directors on the board, giving them control. Holders of subordinated bonds with a face value of another $326 million will receive warrants they can exchange in the future for stock. All other stockhold- ers in the privately-held company will have their current interests cancelled, including the Scudder fam- ily and the Hearst Corp. Singleton, who once owned as much as 45 per- cent of MediaNews Group and currently has 31 percent, will see his interest fall below 20 per- cent. "This reorganization does not come without pain," Singleton said. "Current shareholders will be losing the value of their holdings. But we believe that adopting this plan will give us a far better plat- form from which to devel- op, grow and participate in the consolidation and re- invention of the newspaper industry." Newspaper publishers and broadcasters have struggled with slumping advertising sales, a trend the recession accelerated. Sustained double-digit rev- enue declines have left many publishers unable to support their debt pay- ments. More than a dozen media companies are try- ing to reorganize or have already done so. In spring 2009, Medi- aNews reached an agree- ment with its lenders to make interest-only pay- ments on its debt and start- ed to negotiate a restructur- ing. The company worked out a separate agreement to rework loans, avoiding a bankruptcy filing. Affiliated had sought a similar arrangement, but the large number of bond- holders, not all of whom could be located, made it necessary to take the plan into court. A prepackaged filing, unlike restructuring plans crafted by a borrower or those forced by a lender, has had terms agreeable to both sides hammered out in advance. That requires less time in court. The company expects to com- plete the process within a month or two. Compared to other newspaper groups, Medi- aNews is faring better financially, Singleton said. All of the company's newspapers are profitable except one, although rev- enues continue to decline. Circulation counts for the six months ended in Sep- tember are down 4.8 per- cent for the company's daily publications, com- pared to a 10.6 percent decline for 379 U.S. news- papers. This article was originally published by The Denver Post. Weather forecast 6A Rain likely 50/44 N EWS D AILY DAILY 50¢ MONDAY JANUARY 18, 2010 All Fibers Not Created Equal Vikes, Jets Advance Breaking news at: www.redbluffdailynews.com N EWS D AILY RED BLUFF TEHAMA COUNTY T H E V O I C E O F T E H A M A C O U N T Y S I N C E 1 8 8 5 See Page 5A SPORTS 1B Vitality 7 5 8 5 5 1 6 9 0 0 1 9 Cash Crab Daily News photo by Geoff Johnson Thirty volunteers from the St. Elizabeth Community Auxiliary were joined by volunteers from Red Bluff Union High School, Mercy High School, Starbucks and the Tehama County Young Marines for the Second Annual all-you-can-eat Crab Feed Saturday night at Tehama District Fairground. By GEOFF JOHNSON DN Staff Writer Crack open a crab leg, save a heart. The St. Elizabeth Commu- nity Hospital Auxiliary host- ed its Second Annual all-you- can-eat Crab Feed Saturday night at the Tehama District Fairground, one of the key events in the auxiliary's quest to raise $30,000 for a bundle of new cardiac equipment for St. Elizabeth Community Hospital. Though some lessons carry over from last year's debut, putting on the feed still takes months of planning, said Vol- unteer Services Coordinator Annemarie March. That work stretches months back and encompass- es dozens of volunteers, Chairwoman Linda Ezzart said. On the big night, among those dozens were a mix of Starbucks employees, Mercy High School Students, Red Bluff Union High School stu- dents, and some 30 volunteers from the auxiliary worked to keep the clam chowder flow- ing. The Tehama County Young Marines stood by after post- ing the colors to start the event, ready to clean up the mess. Just 15 minutes into the meal, tickets were nearly sold out, making for more than 400 seats weighed down by stomachs stuffed full of fresh crab. Though exact figures weren't available, the dinner could be enough to pay for as much as half of the cost the auxiliary's contribution toward the cardiac equip- ment, President Karen McFarland said. The popular event is one the organization, now approaching its 50th anniver- sary, hopes to carry on for years to come. ——— Geoff Johnson can be reached at 527-2153, extension 114 or gjohnson@redbluffdailynews .com. Diabetes classes expand By JULIE ZEEB DN Staff Writer Focus on Diabetes, bilingual education classes offered in both Corning and Red Bluff, has added a few new elements to the mix in hopes of making it easier for people to attend the classes. "We changed the classes to weekends to be more family friend- ly," said the Rev. Diana Lueckert. "We will also be holding a family potluck at our monthly meetings." Lueckert said she hopes the change to weekends will draw more people from the Hispanic communi- ty, but that the class is open to all Tehama County residents. "Corning has a large Hispanic community that, to my knowledge, isn't being served," Lueckert said. The free classes, sponsored by the North Valley Episcopal Ministry Focus On Diabetes, offer a wealth of information on managing diabetes through diet and lifestyle choices, Lueckert said. An on-site dietician and educa- tors are available at each of the class- es, which meet the first Sunday of the month in Corning and the sec- ond Sunday in Red Bluff, she said. All classes are bilingual and held at 5 p.m. The Corning class meets at St. Andrews Episcopal Church, 820 Marin St., the Red Bluff class at St. Peter's Episcopal Church, 510 Jef- ferson St. Recipes for fast, easy and inex- pensive meals will be handed out and there will be a food presenta- tion. "The dish cooked at our first class cost $2.16 per person, was cooked in the microwave and done in 10 minutes," Lueckert said. "I can't guarantee they'll all be that cheap, but each meal will attempt to be under $3 a person." Dishes prepared in the food pre- sentation will be the main dish of the potluck and discussions will follow about why they meals are healthy City to hear fire report Fire Chief Michael Bachmeyer Tuesday will present the City Council with the 2009 annual report of the Red Bluff Fire Department and give a presenta- tion on the state of the department. Under a different agenda item, Bachmeyer and Public Works Director Mark Barthel will pro- vide an update on weather condi- tions. The effects of the approach- ing storm could mean potential overtime for staff from the police, fire and public works departments. Other agenda items • A representative from the Tehama County Landfill Manage- ment Agency will give a presenta- tion on the Paint Project Steward- ship Grant. The program educates consumers and retailers on reduc- tion and the legal and practical ways to collect paint from the pub- lic. • Staff has negotiated the con- tract for operation of the Red Bluff Wastewater Treatment Plant with Supes OK ranch land Tehama County approved Tuesday a permanent agricultural easement for a 520 acre family ranch. Under the agreement between owner Charles Ohm and the non- profit Northern California Region- al Land Trust, the landowners will receive subsidies and tax breaks as long as the prime agricultural land on the property is not developed. Ohm, his family and family's friends approached the Board of Supervisors in December to explain that they had already been approached by developers and wanted instead to pass the land on I-5 work delayed An ongoing, $36 million project to replace five miles of concrete on Interstate 5 may not be completed until June. Rain, fog and ground saturation have made replacing the worn, torn concrete that passes through Red Bluff more difficult and may temporarily stop major work, Caltrans spokesman Michael Mayor said Thursday. During the down time, workers may do lighter work, including the replacement of guardrails, he said. The project, which began in August 2009, was scheduled to finish this month, but appears to be com- ing in under budget, Mayor said. Caltrans has previously estimated the number of jobs created by the project would be about 630, based on federal formulas. Drivers coming through construction are asked to stay alert and pay attention to CalTrans warning signs, California Highway Patrol Officer Roger Smith said. Drivers should also be wary of hydroplaning, which will be increasingly likely as Tehama County is hit with a week's worth of rains. —Geoff Johnson Daily News photo by Geoff Johnson Construction equipment sits idle on Interstate 5, where the rainy season has hampered a stimulus project to improve the road. MediaNews holding company restructuring 'It gives us one of the strongest balance sheets in the industry' Dean Singleton, MediaNews Group See FIRE, page 3A See CLASSES, page 3A See LAND, page 3A

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