Interpool Scores Credit Despite SEC Scrutiny; Saks Pays Dividend

Interpool has gained a new $76 million secured credit facility from Fortis Bank despite being under a formal Securities and Exchange Commission investigation. The investigation is for irregularities relating to accounting restatements and delayed filings of financial statements during the last year. The bank loan will be used to finalize the acquisition of containers and refinance an existing loan led by Citibank. An additional $4 million tranche is expected to be added, according to a release from Interpool, a lessor of chassis and marine cargo containers.

James Walsh, Interpool's cfo did not return calls. An official at the company declined comment on the terms of the new facility. The previous credit was originally for $215 million, but was set to be reduced to $172 million by July this year. Last October and November, all three rating agencies downgraded Interpool's debt after the resignation of its president and continued delays in issuing financial statements. Interpool needed to obtain waivers from its lending group for technical defaults under loan agreements associated with these delays. Interpool's financial flexibility has weakened as the delayed financial statements have limited its access to capital, according to Standard & Poor's, which has maintained its BB ratings on watch with negative implications.

* Dobson Communications Corp. has filed an application with the SEC to get a two-week extension for the filing of its 2003 10-K, in order to resolve an ambiguity in covenant language in the bank credit agreement of subsidiary Dobson Cellular Systems. S&P has maintained Dobson Cellular Systems corporate and bank loan ratings at B- with a negative outlook. The agency's ratings reflect negative implications regarding the potential violation of bank covenants as well as increased pressure on roaming revenue due to the pending merger between AT&T Wireless Services and Cingular Wireless.

If leverage is calculated on an annualized basis for the quarter ending March 31, Dobson and its subsidiaries may not be in compliance with the leverage ratio covenants of the bank agreement. The rural cellular services provider is requesting the lenders under the credit agreement eliminate ambiguities and clarify that the ratios should be calculated based on the last four quarters of operation. Warren Henry, a v.p. in investor relations for Dobson, did not return calls by press time.

* Saks' announcement of a one-time $284 million special dividend to shareholders has led Fitch Ratings to maintain its negative outlook on the company's secured bank facility and senior notes ratings, which are currently at BB+ and BB-, respectively. Fitch expects that the payment of the dividend will diminish Saks' cash liquidity and reduce the company's financial flexibility. Saks has an $800 million revolver led by Citigroup and FleetBoston Financial Corp. A Saks spokeswoman did not respond to questions.