Sunday, March 22, 2009

Hoping for this RIF to pass over?

A religiously aware reader points out that the Jewish holiday of Passover starts sundown Wednesday April 8, which may or may not be around the time the layoffs happen. Our reader directs us to the book of Exodus for how the Hebrews managed their escape:

12:22 And ye shall take a bunch of hyssop, and dip it in the blood that is in the bason, and strike the lintel and the two side posts with the blood that is in the bason; and none of you shall go out at the door of his house until the morning.

12:23 For the LORD will pass through to smite the Egyptians; and when he seeth the blood upon the lintel, and on the two side posts, the LORD will pass over the door, and will not suffer the destroyer to come in unto your houses to smite you.


  1. Try striking the lintel and sideposts with a schmear of unctuous Solzhenitsyn. That's what those who will be keeping their jobs are finding useful.

  2. I dunno about "unctuous." I *am* envious of Rod's ability to do what everybody says we should be doing: Create a "brand" for himself that goes beyond the DMN. OTOH, if my job with the DMN were primarily (at least in signed work) national analysis, I would not be sleeping as soundly as I might otherwise...

  3. While I am not an expert in corporate finance, I am concerned about AH Belo’s cash flow and it loan obligations to its lenders.

    The information I am going to refer to is in the company’s annual report (10-k report), available on the web at

    Here is a summary of that it says regarding its credit arrangements with the banks:

    -- On February 4, 2008, the Company entered into a $100 million credit agreement with JP Morgan Chase Bank, J.P. Morgan Securities, Banc of America Securities and Bank of America. At that time the company had no debt.
    -- As of September 30, 2008, the Company was not in compliance with the credit agreement. The company has used $10 million of its line of credit.
    -- During the fourth quarter of 2008, the Company’s bank group approved an amendment credit agreement. (In part reducing the line of credit to $50 million.)
    -- On January 30, 2009, the Company amended its credit agreement again. Among other matters, the amended credit document creates a line of credit secured by the Company’s accounts receivable, inventory, real property and other assets; and sets earning benchmarks that the company must meet.

    Under the credit agreement the Company must meet the minimum adjusted EBITDA (Earnings Before Interest Taxes Depreciation and Amortization) as outlined below:

    For the six months ended March 31, 2009: -$4,000,000 (a negative number)
    For the nine months ended June 30, 2009: $6,500,000
    For the 12 months ended September 30, 2009: $15,000,000
    For the 12 months ended December 31, 2009: $22,500,000

    The key question is whether the company and meet these benchmarks. If it doesn’t, several things could occur:
    -- AH Belo renegotiates its credit agreement
    -- The banks foreclose on AH Belo’s property
    -- The company goes into bankruptcy