Reddi Brake Supply Corp. announces sale of
assets and third quarter and nine months results
VENTURA, Calif.--May 27, 1997--Reddi
Brake Supply Corp. (Reddi Brake)(NASDAQ/NMS:REDI) Tuesday
announced that it has completed the sale of the assets of Reddi
Brake Supply Company Inc., its wholly owned operating subsidiary
presently in Chapter 11 bankruptcy.
The buyer, as previously announced, was Express Parts
Warehouse Inc., a privately owned company based in Raleigh, N.C.
Purchase price was approximately $6 million for all assets,
excluding two notes with current face values totaling
approximately $1.6 million.
The buyer also assumed certain lease liabilities of the
seller. Approximately $4.5 million of the proceeds will be used
to pay off the subsidiary's secured lender. The remaining
proceeds, after operating expenses related to the bankruptcy,
will be used first to pay administrative and priority claims,
with a partial pro-rata distribution expected to unsecured
creditors.
All distributions will be subject to bankruptcy court
approval. Following the expected distribution of Reddi Brake
Supply Co. Inc.'s assets to its creditors, Reddi Brake (the
parent company) will have no significant assets or operations.
On May 20, 1997, Reddi Brake filed its quarterly report on
Form 10-Q for the quarter and nine month period ended March 31,
1997. Due to the impending sale of assets, Reddi Brake adjusted
the value of the assets being sold to the lower of cost or
expected market value.
That adjustment was recorded as a $14.2 million expense.
Additionally, due primarily to declining and suspended sales,
Reddi Brake incurred a $4.6 million operating loss during the
quarter. It also wrote off approximately $500,000 of debt
issuance costs. The net loss for the quarter, including
adjustments, was $19.9 million, or $0.45 per share.
Prior to suspension of operations, Reddi Brake operated 84
Reddi Brake outlets in 26 states, providing two-step distribution
of brake systems, chassis components and other undercarriage
parts to professional installers.
For further information, contact Sandford T. Waddell, chief
executive officer at 805/644-8355.
REDDI BRAKE REPORTS THIRD
QUARTER
AND NINE MONTH
RESULTS
Third
Quarter
Ended March
31
1997
1996
Revenues $4,454,377
$14,417,692
Net Income (Loss) (19,900,404)
(1,435,157)
Net Income (Loss)
Per Share $ (0.45)
$ (0.11)
Weighted Average
Number Of Common
Shares Outstanding 44,668,274
16,530,908
Nine Months
Ended March
31
Revenues $31,850,613
$45,321,306
Net Income (Loss) (26,147,398)
(4,549,957)
Net Income (Loss)
Per Share $ (0.79)
(0.28)
Weighed Average
Number Of Common
Shares Outstanding 32,889,058
16,521,737
CONTACT: Sandford T. Waddell, 805/644-8355