Financial Page
Accounting rule takes bite out of Tom's Foods
Atlanta Business Chronicle - by Meredith Jordan
Tom's Foods Inc. posted a $21.5 million loss for the 24 weeks ended June 15 after the Columbus, Ga.-based snack food-maker adopted the new Financial Accounting Standard Board rule No. 142, which requires companies to review the value of goodwill carried on their books.
As a result, the company took a charge of $22.9 million in the first quarter, according to the company's quarterly report filed July 30 with the Securities and Exchange Commission.
Tom's has manufactured and sold snack food products since 1925 under the widely recognized "Tom's" brand name. Net sales for the second quarter ended June 15 were $52.1 million, an increase of 6.2 percent (or $3.1 million) compared with the corresponding period in 2001.
For the year ended Dec. 29, Tom's posted a net loss of $1.3 million on sales of $210.5 million.
A sinking feeling
RMS Titanic Inc., a Buckhead-based salvage company that owns the rights to recover and display artifacts of the Titanic for profit, has found itself in some rough legal waters.
Company officials plan to appeal to the U.S. Supreme Court an April 12 ruling by the U.S. Court of Appeals for the Fourth Circuit affirming two orders of lower courts restricting the company's sale of artifacts recovered from the Titanic.
The court ruled that a 1994 order conveyed only possession, not title, pending determination of a salvage award. That means all that stuff the company has pulled up from the ocean floor, from a huge piece of the vessel to opera glasses, doesn't actually belong to RMS Titanic.
"[Based on the 1994 ruling] the Company believed it was the exclusive owner of the artifacts," according to its amended annual report filed July 25 with the Securities and Exchange Commission.
RMS Titanic also faces other legal challenges, although none as potent as the one involving the higher court.
RMS Titanic agreed on July 16 to pay Westgate Entertainment Corp. and Weyland & Chase Engineering NV $388,000 to settle a lawsuit over a breached contract. In exchange, Westgate and Weyland, a wholly owned subsidiary of Westgate, agreed not to do any commercial activities at the wreck site.
Westgate alleged in the lawsuit that it had entered into an oral, five-year agreement with the salvage company on Jan. 18, 2000. The "pay or play" contract called for payments of $200,000 per year for Westgate Entertainment and $100,000 per year for Weyland & Chase.
Westgate also agreed to cooperate in civil and criminal cases RMS Titanic is pursuing against a former officer and director, G. Michael Harris.
Harris has sued the company, charging that it breached his employment agreement. RMS Titanic has countersued for $84,000, which company officials allege was misappropriated by Harris. The company also has filed a criminal complaint.
Another lawsuit was filed against RMS Titanic on April 25 alleging fraud, self-dealing, mismanagement, diversion and waste of corporate assets by directors and officers of the company. The company intends to "vigorously defend itself and its officers and directors in this matter."
401(k) online
Invesco Retirement Inc. has expanded distribution of its Internet-based 401(k) product, 401(k) STAR, to include intermediaries and third-party administrators. Company officials say widening distribution will make it easier for smaller companies to provide unique defined-contribution benefits to employees.
$55 million a month
Homestar Mortgage Services' move to Atlanta is paying off. Since opening its first office in Cobb County on Jan. 2, it has added branches in Gwinnett, Henry, Fayette and Rockdale counties. The company also plans to open a downtown office by the end of August.
And since January, it has posted a monthly loan volume of $55 million.
"Atlanta is a great housing market, and we intend to piggyback on its growth," said Rick Floyd, Homestar's executive vice president and national production manager. Homestar's goal is to boost its loan volume to $100 million per month by the end of the year.
Next: Snellville
National Bank of Commerce is opening a branch in the Snellville Kroger on Aug. 1. It is the 11th in-store branch to open in metro Atlanta this year. It's part of a push by the Memphis, Tenn.-based bank to have 30 in-branch stores in metro Atlanta Krogers by year end. All of the branches are expected to be open by the end of 2003. The bank has $18 billion in assets and about 400 locations in nine states in the region.
If you have news for Financial Page, contact Meredith Jordan at (404) 249-1073; fax, (404) 249-1058; or e-mail (mjordan@bizjournals.com).
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