DOVER, Del. (AP) - Newspaper publisher Triple Crown Media Inc., which owns daily and weekly newspapers in Georgia, has filed for bankruptcy protection.
In a prepackaged filing Monday in Delaware bankruptcy court, the Lexington, Ky.-based company listed assets of about $33 million, and liabilities of about $86 million.
Triple Crown operates six daily Georgia newspapers, including the Rockdale Citizen and Newton Citizen, and one weekly with a total daily circulation of about 95,000. On Monday it became at least the 11th newspaper publisher to seek bankruptcy protection over the past year.
The company, which has about 330 employees, announced early last year that it was cutting its work force by 5 percent because of the economic downturn and increased paper and fuel costs.
In a prepackaged Chapter 11 filing in U.S. Bankruptcy Court in Wilmington, the Lexington, Ky.-based company listed assets of about $33 million and liabilities of about $86 million.
The company's daily newspapers are the Gwinnett Daily Post, The Albany Herald, the Rockdale Citizen, the Newton Citizen, the Clayton News-Daily and the Henry Daily Herald. It also published the Jackson Progress-Argus weekly.
In an affidavit, Triple Crown Chief Financial Officer Mark Meikle said the company's immediate goal is "to engage in business as usual following the commencement of these Chapter 11 cases."
According to court papers, Triple Crown has entered into a restructuring support agreement under which holders of more than 80 percent of its second-lien debt would take a 90 percent equity stake in the company. Of the remaining equity interest, holders of the company's preferred stock would receive 5 percent, with the remaining 5 percent allocated to a management incentive plan.
In connection with its 2005 spinoff from Gray Television Inc. and the related acquisition of collegiate marketing and management service businesses that were sold in 2007, Triple Crown entered into two credit facilities. The first-lien facility, which will remain unaltered by the bankruptcy filing, includes a term-loan balance of about $20.3 million and a revolving loan balance of about $18.3 million, along with $375,000 in outstanding letters of credit.
Current principal and interest obligations under the second-line facility total about $35 million, the company said.
"The debtors were faced with over $70 million in secured debt between the credit facilities, with in excess of $40 million becoming due and owing at the end of 2010 and the remainder due the following year," Meikle stated, adding that officials determined the best course of action was to seek a "consensual restructuring" of their debt through a Chapter 11 filing.
A first-day court hearing was scheduled for Tuesday morning.
Meikle said that Triple Crown's newspapers offer locally driven content and a cost-effective medium for local advertising, which he described as more stable thannational advertising "because local businesses generally have fewer effective advertising channels through which to reach their customers."
At the same time, the company has seen total circulation among its seven newspapers drop by 11 percent since 2006.
"This drop in circulation has followed national trends both because of the recession generally and as more individuals receive their news from alternative sources, primarily the Internet," Meikle wrote.