Ceyoniq, a Herndon software company, filed for Chapter 11 bankruptcy protection last week, the latest setback for the company several months after its former German parent filed for insolvency.
Officials at Ceyoniq had said in April that they hoped to continue operating without filing for Chapter 11. Ceyoniq, formerly known as Treev Inc., was a wholly owned subsidiary of Ceyoniq AG of Bielefeld, Germany. Shortly after Ceyoniq AG filed for insolvency in April, the two founders of the German company were incarcerated under allegations of fraud, and the U.S. operation was sold to a private investor, Ceyoniq said.
In a statement, Ceyoniq said the Chapter 11 filing would "allow the company to continue business operations as usual while the management team works on restructuring its finances and improving the company's long-term financial health."
Ceyoniq received debtor-in-possession financing that will allow it to fund its operations while it completes a restructuring plan. The company estimated its assets to be between $1 million and $10 million, but its liabilities range from $10 million to $50 million.
David E. MacWhorter, chief executive of the U.S. company, said he has been trying to negotiate loan agreements with banks and to "manage the financial liability" Ceyoniq was saddled with after its German parent failed. "However, after careful consideration and the exploration of many other options, we concluded that financial reorganization is the best course for our customers, creditors and employees," MacWhorter said.
Ceyoniq's software is designed to help companies manage customer relationships.
Fairchild of Dulles completed the sale of its fastener business for about $657 million to Alcoa Inc. Fairchild may receive additional cash proceeds of up to $50 million, in an "earn-out" formula based on the number of fastener deliveries to Boeing Co. and Airbus SAS in the next three years. Chief executive Jeffery J. Steiner said the sale reduces Fairchild's dependency on a single industry and will provide money for new acquisitions. The sale also reduced Fairchild's debt, including $225 million in bond debt.
The Avalon, the 80-year-old movie theater on Connecticut Avenue NW, may be ready to reopen by Feb. 14. Until it was shut down by Loews Cineplex Entertainment Corp. in March 2001, the Avalon was the District's longest continuously operating movie theater. When Loews abandoned its lease, it looked like curtains for the Avalon, until a neighborhood group stepped in and began fundraising to restore the theater. Since then, the group has received a $50,000 grant from the city and is selling seats in the movie house. So far that effort has raised nearly $65,000, said Bob Zich of the Avalon Theatre Project. Meanwhile, the roof has been replaced and work is progressing on the theater's ceiling and walls. The Theatre Project also has been in talks with Laemmle Theatres, a major art-house chain in Los Angeles, to serve as a distributor of films for the Avalon, Zich said.
Legacy Hotels Real Estate Investment Trust of Toronto completed its $152 million acquisition of Washington's Monarch Hotel. Legacy said Fairmont Hotels & Resorts Inc. will manage the property, which will be officially flagged "The Fairmont Washington, D.C." on Dec. 11. Legacy said the Monarch "will benefit from the Fairmont brand and ultimately from the rebound in the U.S. economy."
Allied Capital Corp., a Washington investment company that buys businesses and lends money to firms, invested $10.4 million in the subordinated debt of Frozen Specialties Inc., an Ohio manufacturer of budget, private-label frozen pizza and appetizers for convenience stores and groceries nationwide.
Sinclair Broadcast Group, a Baltimore owner of television stations, proposed issuing up to $150 million of senior subordinated notes in a private offering. Sinclair intends to use the proceeds, along with available cash on hand or bank debt, to finance the repurchase or redemption of its existing bonds due Dec. 15, 2007, that bear an 8.75 percent interest rate. The company had already begun a tender offer for the outstanding 2007 notes.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers