S&P: Tom's Foods on watch

Standard & Poor's said it placed its ratings on Tom's Foods Inc. on CreditWatch with negative implications because of concerns about the company's ability to finance upcoming maturities. On CreditWatch are both the company's B corporate credit and B- senior secured debt ratings.

S&P said it is concerned about Tom's Foods' ability to refinance its financial obligations given the imminent maturities for its unrated $17 million revolving credit facility and its rated $60 million in 10.5% senior secured notes due in November 2004.

The prior termination date for the revolving credit facility was Aug. 31, 2004, but the company has extended this to Sept. 30, 2004 while it works on a transaction to refinance both the credit facility and notes.

S&P said it believes it is likely the company will also be able to secure subsequent extensions of the credit facility. However, S&P said it remains concerned about the company's ability to successfully complete a comprehensive refinancing transaction within the next two months.

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