Bill McDonnell
VP, CFO
"We are well aware of the issues that S&P cited and are actively
working on refinancing our outstanding bank debt. Over the last
two years we have significantly improved margins and EBITDA
while also reducing bank debt by over $100 million. We continue
to work with Salomon Smith Barney to develop and evaluate our
refinancing options. As a part of our plan we have entered into
an agreement with Rent-A-Center to sell 295 of our stores with
the net proceeds to be used to pay bank debt and reduce
leverage. We expect to be in the market with our refinancing
after closing the store sale. Finally, it is encouraging to
report that our operating performance in the first quarter of
fiscal 2003 was very strong, with revenues of approximately $142
million, slightly ahead of our guidance for the quarter. In sum,
we believe we are on the right track and we will continue to
work diligently toward a successful refinancing."
"An obligation rated ‘CCC’ is currently vulnerable to
nonpayment and is dependent upon favorable business, financial,
and economic conditions for the obligor to meet its financial
commitment on the obligation. In the event of adverse business,
financial, or economic conditions, the obligor is not likely to
have the capacity to meet its financial commitment on the
obligation"
