Arrow Reports Chapter 11 Filing
PORTLAND, Ore., June 2, 1997 - William J. Stanners, Jr.,
Senior Vice President and Chief Financial Officer of
Bulletin Board: ARRW), today announced that the board of
directors of Arrow Transportation Co. had directed that a
petition for reorganization under Chapter 11 of the U.S.
Bankruptcy Code be filed on Monday, June 2, 1997, for its only
subsidiary, Arrow Transporation Co. of Delaware. Stanners said,
"Arrow is a leading provider of bulk transportation services
in the western United States. It has served its customers
successfully for over 66 years and plans, without any
interruptions, to continue to offer superior service to its
customers during the reorganization."
Stanners stressed that the Company is reorganizing under the
protection of the Bankruptcy Court, and fully expects to emerge
from the bankruptcy a stronger, more competitive operator in the
bulk transportation field.
"The financial burden imposed by rapid fleet and
geographic expansion, and an unfavorable Union agreement,
combined with intrastate deregulation and contingent liabilities
faced by the Company relating to operations predating the current
management, made it impossible for the company to operate without
some relief from those obligations," Stanners said. He also
stressed that it is important the Company's stakeholders
understand the Company is continuing to move forward with its
profit improvement plan and that its primary lender has been very
supportive and has agreed to provide financing to the Company
during the bankruptcy reorganization process. Stanners also noted
that the Company is already working with the Union toward an
agreement that would allow the Company to be competitive and
preserve a large number of Union jobs.
Arrow Transportation Co., through its only subsidiary, Arrow
Transportation Co. of Delaware, is engaged primarily in the
transportation of bulk liquid chemical products. The company
serves a wide variety of manufacturing and industrial customers
in the United States and Western Canada.
SOURCE Arrow Transportation Co. /CONTACT: William J. Stanners,
Jr., Senior Vice President and Chief Financial Officer of Arrow
Transportation Co., 503-286-3661/
Three Massachusetts Residents Charged With
Bankruptcy Fraud, Reports U.S. Attorney's Office
BOSTON, MA - June 2, 1997 - Bankruptcy fraud charges were
filed today against three Massachusetts residents.
United States Attorney Donald K. Stern stated that criminal
informations were filed today against PATRICIA M. LOCKNEY, 47, of
117 Vine Street, Douglas, Massachusetts, PHILIP J. MARA, JR., 32,
of 22 Clifford Road, Southboro, Massachusetts, and THOMAS M.
PEEBLES, 43, of 23 McCormick Terrace, Unit 35, Stoughton,
Massachusetts.
The LOCKNEY Information alleges that she filed a joint
bankruptcy petition in September, 1996, with her husband, and
listed her home as having a market value of $70,000; that LOCKNEY
thereafter sought to obtain bankruptcy court permission to sell
the property to her daughter, which would have wiped out the
substantial liens on the property; that LOCKNEY made arrangements
with a mortgage loan broker for her daughter to borrow the money
to buy the property; that LOCKNEY learned from the broker that
the home had been appraised for $116,000; that LOCKNEY then
fabricated a "statement of value" purporting to be from
a real estate broker and giving a value of $70,000; that LOCKNEY
forwarded the fabricated "statement of value" and an
"offer to purchase" the home for $70,000 to her
bankruptcy lawyer, on the same day she sent the mortgage loan
broker a purchase and sale agreement reflecting a $116,000 price.
The Information alleges that LOCKNEY's bankruptcy lawyer
requested and obtained Bankruptcy Court approval for the sale,
based on the false information provided by LOCKNEY.
MARA was charged in a two-count criminal information with
testifying falsely under oath in a bankruptcy proceeding and
transferring and concealing assets of a bankrupt company.
According to the Information, MARA was the President of Philip
Mara Co., a plumbing supply company located in North Grafton,
Massachusetts and MARA had the company file for bankruptcy in
March, 1995. The charges further allege that while considering
the bankruptcy filing, MARA withdrew a check for $11,687 from the
company's account and used it for personal purposes; then when
questioned under oath about the withdrawal at a bankruptcy
hearing, MARA falsely stated that he had taken the money as a
reimbursement for corporate expenses he had paid.
The Information also alleges that about one month before the
bankruptcy filing, MARA took $25,000 from the company for
personal purposes, then failed to disclose the withdrawal in
company's bankruptcy pleadings, which MARA had signed under
penalty of perjury.
PEEBLES was charged with concealing from his bankruptcy
creditors and bankruptcy trustee his interest in real property
located on Juniper Meadow Road in Danbury, N.H. The information
alleges that in 1989, PEEBLES purchased the property then
transferred it to a friend in 1991 in a sham transaction designed
to protect it from creditors. The information charges that
PEEBLES reimbursed the friend for all costs associated with the
transfer and that they both agreed and understood that the
property was in fact owned by PEEBLES. The information further
alleges that when PEEBLES filed a bankruptcy petition in 1995, he
concealed his ownership of the New Hampshire property from his
creditors and the bankruptcy trustee.
Each defendant faces five years in prison, a $250,000 fine,
restitution, a $100 special assessment and three years supervised
release on each count.
These cases were investigated by the Federal Bureau of
Investigation, were referred by the U.S. Trustee's Office in
Boston and Worcester, and are being prosecuted by Assistant U.S.
Attorney Mark J. Balthazard of Stern's Economic Crimes Unit.
SOURCE U.S. Attorney's Office /CONTACT: Joy Fallon or Amy
Rindskopf of the U.S. Attorney's Office, 617-223-9445/
Court approves Sizzler plan to emerge
from Chapter 11; creditors to be repaid in full
LOS ANGELES, CA --June 2, 1997--The U.S. Bankruptcy Court for
the Central District of California Monday approved the financial
reorganization plans of Sizzler
International Inc. (SII) (NYSE:SZ) and its domestic
subsidiary, Sizzler Restaurant International Inc. (SRI), in which
creditors will be repaid in full.
Management described the Chapter 11 process as "extremely
successful," as a result of which the company has emerged in
a much stronger financial position.
In announcing this development, James A. Collins, Sizzler
International's chairman who recently assumed the additional
position of chief executive officer, said that, as a result of
the actions taken by the company during the Chapter 11 process,
Sizzler International expects vastly improved operating results
for the current fiscal year ending April 30, 1998.
He added that the approved plans do not dilute shareholders'
equity nor do they require the liquidation of any profitable
operations.
Achieved All Key Objectives
Collins said: "Approval of the plans means that the
company has achieved what we set out to accomplish by filing for
Chapter 11 protection. It has permitted the orderly downsizing of
our company, helped return the domestic restaurant business to
profitability and allowed Sizzler to effectively manage the
disposal of closed restaurant assets and related liabilities.
"The closing of underperforming U.S. Sizzler restaurants
and operating changes in domestic restaurants -- all during the
Chapter 11 process -- have substantially improved our financial
strength and future prospects as compared to the company's
position when it filed for Chapter 11 protection on June 2 of
last year."
The restructuring undertaken during the Chapter 11 process
leaves Sizzler's U.S. operations with 69 company-operated
restaurants and 199 franchised restaurants.
Approved Plans
The confirmation of the SII and SRI plans followed the
affirmative vote of the required majority of SII's and SRI's
creditors.
-- The SII plan calls for full payment of creditors' claims,
estimated by the company to be in the $70 million range, to be
secured by and paid in full primarily from international
operations.
-- The SRI plan, covering the domestic restaurant subsidiary,
provides full payment of creditors' claims, which the company
estimates to be approximately $25 million. The plan calls for
these debts to be secured by and paid in full from domestic
operations.
Full Repayment
The plans will become effective within the next 30 to 60 days.
At this time, the company expects to make initial payments
totaling about $21 million. The company said these plans make
possible the repayment of approved creditor claims, facilitate
the company's return to financial health and position Sizzler for
a resumption of growth. Combined, the plans call for repayment of
approximately $95 million, paid in installments, with interest,
over 4 to 5 years.
Management Changes
In addition to Collins assuming the position of SII chief
executive officer, the company has announced that former SII
President and CEO Kevin Perkins has been named president and CEO
of Sizzler's international business and former Chief Financial
Officer Christopher Thomas has been named president and CEO of
Sizzler's domestic operations.
Thomas will retain his duties as executive vice president of
the parent company. In addition, former Vice President and
Controller Ryan Tondro has been named vice president and chief
financial officer of SII, reporting to Thomas.
Collins said: "The management changes announced today
reflect increased focus on profitability and geographic
opportunities. We believe that the main problems in our domestic
business that were the principal reasons for filing Chapter 11
have been resolved. We have eliminated substantial future
liabilities and are in much better position to produce profits in
our U.S. restaurant operations.
"Kevin Perkins is dedicating all of his efforts to
growing and developing the important Asia-Pacific area. At the
same time, Christopher Thomas will continue to lead the
improvements in our domestic operations which he began in
January."
Sizzler International operates or licenses approximately 108
company-owned and 296 franchised Sizzler restaurants around the
world. The company also operates 96 KFC restaurants in
Queensland, Australia.
For more information on Sizzler International via facsimile at
no cost, call 800/PRO-INFO and dial client code "SZ."
CONTACT: Sizzler International Inc., Los Angeles Christopher
Thomas, 310/827-2300 or The Financial Relations Board Inc., Los
Angeles Stacy Roughan, 310/442-0599 (general info) Moira
Conlon/Michaelle Burstin, 310/442-0599 (investors/analysts)
Steven Seiler, 310/442-0599 (media)