Classic May Need Chapter 11 Plan9/09/2001 8:00 PM Eastern
New York— Troubled Classic Communications Inc. missed another interest payment on its bond debt and warned that it might be forced to reorganize under Chapter 11 of U.S. bankruptcy law.
In a securities filing, Classic said it failed to make a $7.2-million interest payment due on Aug. 1. Because it did not make that payment by Aug. 31, Classic said it was prohibited from making another $11.8-million interest payment due Sept. 4 on other notes.
Classic estimated $153 million of the notes are outstanding.
Classic said it is negotiating with lenders and has retained Credit Suisse First Boston Corp. to seek alternative financing. But because of the default, bondholders could request that the debt be paid in full immediately. Classic said it couldn't make such an immediate payment "and would likely seek to reorganize under the provisions of the federal bankruptcy laws."