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/raid1/www/Hosts/bankrupt/TCR_Public/980707.MBXT R O U B L E D C O M P A N Y R E P O R T E R Tuesday, July 7, 1998, Vol. 2, No. 131 Headlines CENTENNIAL CELLULAR: Investment Partnerships Acquire 93% CREATIVE COMPUTERS: Annual Meeting Scheduled for July 24 ELDER-BEERMAN: Retirement Plan Receiving New Common Stock GEOTEK: Stock De-Listed GEOTEK COMMUNICATIONS: $10M DIP Pact Has Interim Okay GRAND UNION: Court Approves Cash Collateral Use GRANT GEOPHYSICAL: Amends Registration Statement HOME HOLDINGS: Files Supplemental Registration Materials HOROWITZ/RAE: Seeks Chapter 11 KIA MOTORS: To Be Put Up for Public Tender on July 15 LATTICE SEMICONDUCTOR: Annual Meeting of Stockholders MRS TECHNOLOGY: Files For Chapter 11 Reorganization MAINE INVESTMENTS: Banks Provide Bail-Out METALLURG INC: Standard & Poor's Issues Ratings OMAK WOOD: Judge Rossmeissl Approves Plan OXFORD HEALTH: Preliminary Notice of Annual Meeting PEGASUS GOLD: Reports First Quarter Results POCKET COMMUNICATIONS: Lenders Delay Filing RELIANCE ACCEPTANCE: Plan Approved Announces Ugly Duckling PRESLEY COMPANIES: Receives Non-Binding Acquisition Offer TIE/COMMUNICATIONS: Seeks Order Authorizing Sale TOLLYCRAFT: Completes Negotiations with 2 Largest Creditors TRI-CITY HEALTH: Files for Bankruptcy Protection TRITEAL CORP: Unaudited Fourth Quarter Financial Results WESTERN FIDELITY FUNDING: Court Approves Financial Advisor WORK RECOVERY INC: $2 Million Line of Credit Meetings, Conferences and Seminars ********* CENTENNIAL CELLULAR: Investment Partnerships Acquire 93% -------------------------------------------------------- In a report by Newsbytes News Network, on July 6, 1998, Centennial Cellular [NASDAQ:CYCL] has been scooped up by a newly setup firm created by Welsh, Carson, Anderson & Stowe, the investment bankers, in a deal worth around $2 billion. Newsbytes understands that around $500 million worth of debt on the cellular network will need to be refinanced, but the bulk of the deal will be structured as a recapitalization, with Centennial's business continuing as normal. Under the deal, investment partnerships affiliated with Welsh, Carson, Anderson & Stowe will own around 93 percent of Centennial's outstanding shares. Plans call for WCAS to invest about $350 million of equity and $150 million of subordinated debt. The deal is subject to shareholder and regulatory approval. Newsbytes notes that the arrangement comes just 12 weeks after the firm hired Donaldson, Luftkin and Janrette, the investment bankers, to assist it in seeking suitable options. Centennial turned in a net loss of $33.3 million in its last full financial year. So far this financial year, the firm has reported a net loss of $26 million for the first nine months. CREATIVE COMPUTERS: Annual Meeting Scheduled for July 24 -------------------------------------------------------- Creative Computers, Inc., has notified its shareholders that it will hold their annual meeting at the Marriott Hotel, 3635 Fashion Way, Torrance, California 90503 on Friday, July 24, 1998 at 10:00 a.m. local time: 1. To elect four directors of the Company to serve until the 1999 Annual Meeting of Shareholders or until their successors are duly elected and qualified; The Nominees are: (a) Frank F. Khulusi -- co-founder of the Company (and its predecessor) and has served as Chairman of the Board, President and Chief Executive Officer of the Company since the Company's inception in 1987. He is the brother of Sam U. Khulusi. (b) Sam U. Khulusi is a co-founder of the Company and served as Executive Vice President and Chief Operating Officer of the Company from October 1994 until February 1996. From 1987 until October 1994, Mr. Khulusi served as Chief Financial Officer of the Company. Mr. Khulusi currently is the Chairman and Chief Executive Officer of Emed, LLC, a software development company. He is the brother of Frank F. Khulusi. (c) Ahmed O. Alfi has served as a director of the Company since September 1994. Mr. Alfi has served as the Chairman of the Board and Chief Executive Officer of Alfigen, a prenatal diagnostic company, since January 1992. Since January 1996, Mr. Alfi has served as a director of SmarTalk Teleservices, a publicly traded telecommunications service provider. (d) Thomas Maloof has served as a director of the Company since May 1998. Mr. Maloof is the President of Perinatal Practice Management, Inc. From September 1997 until February 1998, Mr. Maloof served as Chief Financial Officer of Prospect Medical Holdings. From January 1995 until September 1997, Mr. Maloof was the Chief Executive Officer of Prime Health of Southern California. From October 1992 until December 1994, Mr. Maloof was President of Foundation Health, a California health plan provider. (2) To ratify the appointment of Price Waterhouse LLP as the Company's independent accountants for the fiscal year ending December 31, 1998; and (3) To transact such other business as may properly come before the meeting or any adjournment thereof. ELDER-BEERMAN: Retirement Plan Receiving New Common Stock --------------------------------------------------------- The Elder-Beerman Stores Corp. filed a Form S-8 with the SEC describing the implementation and funding of its post- Effective Date Retirement Savings Plan. The full-text of the filing is available at no charge via the Internet at http://www.sec.gov/Archives/edgar/data/32020/0000950152-98- 005776.txt GEOTEK: Stock De-Listed ----------------------- Geotek Communications, Inc. (NASDAQ: GOTK, Pacific: GEO), a provider of mobile logistics systems, today announced that the Nasdaq Listing Qualifications Panel has decided to delist the Company's securities from Nasdaq effective with the close of business on June 30, 1998. As previously reported, Nasdaq had earlier informed the Company that its securities were scheduled to be de-listed; that action was stayed pending a hearing that was subsequently held on June 4, 1998. On June 29, 1998, the Company announced the filing, in the U.S. Bankruptcy Court in Wilmington, Delaware, of voluntary petitions seeking protection under Chapter 11 of the Bankruptcy Code. GEOTEK COMMUNICATIONS: $10M DIP Pact Has Interim Okay ----------------------------------------------------- The court gave Geotek Communications Inc. interim approval to borrow up to $7 million under a $10 million debtor-in- possession credit facility from Soros-affiliate S-C Rig Investments III L.P., pending a July 23 final hearing. Noting that its future viability depends on prompt confirmation of a reorganization plan and/or a capital infusion, Geotek said the DIP agreement is based on a term sheet for a proposed plan, which in turn is premised on a rights offering. The DIP agreement requires the mobile communications provider to file a plan by July 15. (Federal Filings Inc. 2-July-98) GRAND UNION: Court Approves Cash Collateral Use ----------------------------------------------- The court has authorized Grand Union Co. to use the cash collateral of its prepetition bank group, led by Bankers Trust Co., for the daily operation of the company's 222 supermarkets. As of June 24, the company owed about $237.1 million plus interest to various prepetition lenders under a June 1995 credit agreement. Grand Union is seeking approval of a $172 million debtor-in-possession financing facility that would refinance the senior tranches under the prepetition credit facility. A hearing is set for July 9. (Federal Filings Inc. 2-July-98) GRANT GEOPHYSICAL: Amends Registration Statement ------------------------------------------------ Grant Geophysical, Inc., in an Amendment to its Registration Statement filed in connection with the issuance of New Common Stock pursuant to the terms of its confirmed plan of reorganization, relates that: (1) Registration expenses totaled $575,000; (2) The Company is providing broad indemnification provisions for the benefit of its officers and directors under Section 145 of the Delaware General Corporation Law; (3) It has issued all shares to Elliott and Westgate in exchange for cash and/or satisfaction of indebtedness pursuant to the terms of the Plan. HOME HOLDINGS: Files Supplemental Registration Materials -------------------------------------------------------- Paving the way for emergence from chapter 11 under its confirmed plan of reorganization, Home Holdings, Inc., has filed supplemental registration material with the SEC under Form T-3 relative to its issue of New Notes. The full-text of the Company's filing is available at no charge via the Internet at http://www.sec.gov/Archives/edgar/data/875090/0001005477- 98-002152.txt HOROWITZ/RAE: Seeks Chapter 11 ------------------------------ Fairfield, N.J.-based Horowitz/Rae Book Manufacturers Inc., parent Horowitz Rae Holdings Inc., and three subsidiaries filed Chapter 11 June 30 in Wilmington, Del. The companies manufacture books for publishers. A. Horowitz & Son is the binding arm and Rae Lithographers Inc. is the printing arm. PMC Publishing Co. is a unit of A. Horowitz. Horowitz Rae Holdings listed total assets and liabilities of approximately $15.8 million and $22.1 million, respectively. The companies'largest unsecured creditors include CMNY Capital II L.P. of New York, N.Y. ($800,000), Alling & Cory of Philadelphia ($473,261), CMCO Inc. of New York, N.Y. ($300,000), and Technican of Whippany, N.J. ($218,847). (The Daily Bankruptcy Review Copyright c July 6, 1998 - ABI 07-July-98) KIA MOTORS: To Be Put Up for Public Tender on July 15 ----------------------------------------------------- South Korea's ailing Kia Motors Corp. and its sister firm, Asia Motors Corp., will be put up for public tender on July 15, creditors said Monday. Kia's main creditor, Korea Development Bank (KDB), said successful bidders would be named at the end of August. KDB officials said letters of "offer memorandum" would be sent to South Korean and foreign buyers, including US auto giant Ford Motor Co., which holds a 16.9-percent stake in Kia with Japanese affiliate Mazda Motor Corp. The timetable, decided in talks between KDB officials and Kia's court-appointed chief Yu Jong-Ruyl, immediately sparked a bidding battle. "Daewoo Motor Co. has decided to form a consortium with Hyundai Motor Co. for the tender," Lee Jung-Sung, a Daewoo Group spokesman, told AFP. "We have yet to negotiate details on the consortium. But we expect a positive response from Hyundai, which has also offered to take part in the tender," Lee said. Daewoo and Hyundai, the country's two largest auto makers, have insisted South Korean firms should acquire Kia, which was declared insolvent in July last year. Kia, however, has favored Ford. KDB officials said Kia would be sold off through public bids and liquidation procedures simultaneously. (Agence France-Presse 06-Jul-1998) LATTICE SEMICONDUCTOR: Annual Meeting of Stockholders ----------------------------------------------------- The Annual Meeting of Stockholders of Lattice Semiconductor Corporation will be held on August 10, 1998, for the following purposes: 1. To elect two Class III directors to serve a term of three years or until their successors are elected; 2. To approve an amendment to the Company's 1996 Stock Incentive Plan increasing the number of shares reserved for issuance thereunder by 2,300,000 shares; and 3. To ratify the appointment of Price Waterhouse LLP as independent accountants of the Company for the fiscal year ending April 3, 1999. MRS TECHNOLOGY: Files For Chapter 11 Reorganization --------------------------------------------------- MRS Technology, Inc. (NASDAQ:MRSI) announced that it filed for reorganization under Chapter 11 of the Federal Bankruptcy Code. The filing took place last week at the federal bankruptcy court in Worcester, Massachusetts. "The Chapter 11 filing will enable us to conserve cash while continuing to seek financing and strategic partners to help us pursue our target market, the market for high density interconnect (HDI) with high density single and multi-chip packaging," said Carl Herrmann, President and CEO. In connection with this filing, the Company has reduced its workforce by approximately 80%, effective immediately. The Company has retained Cohn & Kelakos LLP of Boston as its Chapter 11 counsel. MRS Technology, Inc. is a supplier of advanced systems needed for production of electronic products manufactured with large area microlithographic processes. Based in Chelmsford, Massachusetts, MRS Technology markets and sells its products worldwide. The Company's Common Stock is traded on the Nasdaq National Market; its trading symbol is MRSI. MAINE INVESTMENTS: Banks Provide Bail-Out ----------------------------------------- The banking syndicate that holds the key to Maine Investments' future has agreed in principle to inject more money in a last-ditch bid to keep some of the country's best-known businesses afloat. Nearly 2000 jobs have been up in the air in recent weeks as tense negotiations have continued over the future of Maine subsidiaries such as Masport, Projex and Skellerup Industries. However, the banks and Goldman Sachs finally appear to have agreed on how the company will be restructured. Maine chairman Jim Gaffney said banks had agreed in principle to a plan that will see an additional $10 million put into the business. Under the proposal, the banks have agreed to carry $5 million more in debt and to forgo another $5 million in interest payments. In return, the restructured company, which will be known as Viking Pacific, will be able to have a cash issue of up to $15 million in the nine months following the restructuring. If fully exercised, the issue is expected to reduce Viking Pacific's debt to $103 million by next June, down from the $129 million previously forecast. Although the proposal has yet to be approved by each bank's credit committee, Maine appeared confident it would go ahead. It said it expected settlement and implementation of the restructuring to take place early next week. According to Maine, the proposal will not require a bondholder meeting. But the Trustee for the bondholders, NZ Guardian Trust, described the claim as "presumptuous at this time". Guardian Trust said it was still evaluating the proposal. (Supplied by New Zealand Press Association Evening Post 02- Jul-1998) METALLURG INC: Standard & Poor's Issues Ratings ------------------------------------------- Standard & Poor's today affirmed its single- 'B' corporate credit and bank loan ratings on Metallurg Inc. and its single-'B'- minus senior unsecured debt rating on the company and removed these ratings from CreditWatch, where they were placed June 23, 1998. At the same time, Standard & Poor's assigned its triple- 'C'-plus rating to the company's proposed senior secured discount notes due 2008, which will be issued by Metallurg Holdings Inc., the direct parent of Metallurg Inc. The outlook is stable. The CreditWatch placement followed the announcement that Metallurg agreed to be acquired by Safeguard International Fund L.P., a private equity fund. Management has taken steps in recent years to improve the company's product mix and has had some success in improving operating margins from prior weak levels. Currently, the company is benefiting from favorable market conditions in the aerospace and transportation sectors. Still, it serves highly cyclical markets and remains vulnerable to significant supply shocks. Operating margins (before depreciation and amortization) are expected to continue to fluctuate between 7.0%-8.5% due to changes in the product mix, although supported by the company's cost-reduction initiatives. Standard & Poor's expects the company's cash interest coverage (ratio of earnings, before interest, taxes, depreciation, and amortization to cash interest) to range from low 4 times (x) to low 5x, while interest on the proposed senior discount note is noncash. The company's cash interest coverage will weaken significantly in 2003, the year the proposed issue changes to a cash interest basis. Although financial performance will benefit over the near-term from favorable market conditions, financial flexibility is extremely limited in light of the company's aggressive debt leverage, Standard & Poor's said. OMAK WOOD: Judge Rossmeissl Approves Plan ----------------------------------------- Bankruptcy Judge John Rossmeissl last week approved the reorganization plan for Omak Wood Products, which had closed in May after filing for Chapter 11 last year, according to The Spokesman Review. The plan calls for the sale of the company for $19.5 million to Quality Veneer & Lumber, which plans to restart the mill's plywood and veneer plant but not lumber production. The sale is expected to be completed by the end of July, according to attorney Shaun Cross of Paine Hamblen, Spokane. He said that $1.7 million in payroll and employee severance costs will be paid in full, as well as vendor claims, logging contracts and professional fees incurred after the filing. Ninety-seven percent of the creditors who voted accepted the plan. (ABI 07-July-98) OXFORD HEALTH: Preliminary Notice of Annual Meeting --------------------------------------------------- Oxford Health Plans, Inc., has notified the SEC that it plans to hold an August 1998 annual meeting of shareholders in Old Greenwich, Connecticut: 1. To elect three directors to serve as Class I Directors of the Company for a term ending at the 2001 Annual Meeting. The Nominees are: Name Age Position ---- --- -------- David Bonderman 55 Director Jonathan J. Coslet 33 Director Benjamin H. Safirstein, M.D. 59 Director 2. To approve the vesting of voting rights in respect of the Company's Series B Cumulative Preferred Stock and the issuance, subject to adjustment, of up to 6,730,000 shares of the Company's Common Stock, upon exercise of the Company's Series B Warrants issued to TPG Oxford LLC and certain assignee purchasers, pursuant to the Investment Agreement, dated as of February 23, 1998 (the "Investment Agreement"), between TPG Oxford LLC and the Company, at an exercise price, subject to adjustment, of $17.75 per share of Common Stock, on the terms and subject to the conditions set forth in the Series B Warrants (the "Common Stock Issuance Proposal"). 3. To amend the Oxford Health Plans, Inc. 1991 Stock Option Plan, as amended, to increase the number of shares of Common Stock issuable thereunder from 21,580,000 shares to 25,580,000 shares. 4. To amend the Oxford Health Plans, Inc. 1991 Stock Option Plan, as amended, to increase the annual individual optionee limit from 200,000 to 2,000,000 shares and to effect certain other changes specified herein. 5. To act on two shareholder proposals. 6. To transact such other business as may properly come before the Meeting or any adjournment or postponement thereof. PEGASUS GOLD: Reports First Quarter Results --------------------------------------------- Pegasus Gold Inc. (PSGQF - OTC B.B.) recorded a net loss of $9.1 million, or $0.22 per share, in the first three months of 1998, compared with a net loss of $15,000, or $0.00 per share, in the same period of 1997. During the first quarter of 1998, total gold production was 65,632 ounces compared to 87,486 ounces the year before. Lower gold production in 1998 resulted from operating only three mines; Florida Canyon, Montana Tunnels, and Diamond Hill, compared to six mines a year earlier. In Australia, at the second meeting of creditors of Pegasus Gold Australia (PGA), the creditors approved a Deed of Company Arrangement which allows for the sale of the assets of, or shares in, PGA by the independent Deed Administrator. Investor Resources Limited (IRL) has been retained by the Deed Administrator and has commenced the process of selling Mt. Todd. Pegasus Gold Inc.'s efforts are on track to file its Plan of Reorganization (POR) on or before July 31, 1998. As reported earlier, the preliminary work on the POR using current gold prices indicates that the common shareholders of Pegasus Gold Inc. are unlikely to receive any distribution in the reorganization. The preliminary POR proposes to reorganize the operating assets into a new entity. Certain of the Company's creditors, primarily the bank group, would exchange their debt for the majority of the equity in the new company. Total sales revenues for the first quarter were $26.9 million, compared with $48.6 million last year, due to lower gold prices and production. For the first quarter of 1998, the Company realized an average of $295 per ounce, compared to the COMEX average of $294 per ounce. During the first three months of 1997, the Company realized an average price of $460 per ounce, versus the corresponding COMEX average of $352 per ounce. Sales of other metals in the first quarter were $7.6 million compared to $8.4 million in the first quarter of 1997. Realized prices were $5.64 per ounce, $0.45 per pound, and $0.26 per pound for silver, zinc, and lead, respectively, compared to $4.42, $0.54, and $0.30, respectively, in the first quarter of 1997. Pegasus Gold Inc. and Pegasus Gold Corp. have instituted a lawsuit against the EPCM contractor and members of the Bateman Kinhill Kilborn joint venture who completed the feasibility study and designed and built the Phase II facilities at Mt. Todd. Pegasus seeks damages of A$272 million for claims alleging professional negligence and violations of the Australian Trade Practices Act. It is too early to predict the likelihood of any recovery. POCKET COMMUNICATIONS: Lenders Delay Filing ------------------------------------------- Pocket Communications Inc.'s lenders delayed filing a disclosure statement for their proposed reorganization plan because it has taken longer than expected to incorporate comments from the various parties. The lenders have asked the court to extend the filing deadline from June 30 to July 20. Pocket, the Federal Communications Commission, and the creditors' committee have no objection to the extension request. (Federal Filings Inc. 02-Jul-1998) RELIANCE ACCEPTANCE: Plan Approved Announces Ugly Duckling ---------------------------------------------------------- Ugly Duckling Corp. (Nasdaq/NM:UGLY) Thursday announced that the Fourth Amended Joint Plan of Reorganization under Chapter 11 of the Federal Bankruptcy Code of Reliance Acceptance Group Inc. and its subsidiaries was approved as of June 30, 1998 by those entitled to vote under the plan. The plan, along with certain technical amendments, was also approved that same day by the United States Bankruptcy Court for the District of Delaware. Thursday, the plan was confirmed by entry of the Court's order approving said plan. The plan's scheduled effective date for the reorganization is July 31, 1998. As previously announced, in February 1998, Ugly Duckling entered into an agreement to service Reliance's receivables portfolio, which agreement was approved, as amended, by the Court on June 30, 1998, effective upon entry of the plan confirmation order. Ugly Duckling will begin servicing under this agreement beginning August 1, 1998, after the plan effective date occurs. The servicing agreement provides for, among other things: (1) Reliance to pay Ugly Duckling a base percentage servicing fee of 4% per annum (or if greater, $15 per receivable per month), (2) incentive fees (subject to certain adjustments, payment priorities and conditions), and (3) Reliance to reimburse Ugly Duckling for certain costs and expenses. The provision of the servicing agreement pertaining to incentive fees was amended as part of the plan confirmation hearing on June 30. The servicing agreement, as amended, continues to provide for the payment to Ugly Duckling of a $1.3 million cash incentive fee subject to and upon the effective date of the plan. There can be no assurance that the Reliance Plan will become effective, or if it becomes effective, that Ugly Duckling will actually be paid any incentive fees, including the $1.3 million fee. In addition, concerning the June 30 hearing, Reliance, its bank group, the Reliance creditors' committee, and Ugly Duckling agreed to address certain post-confirmation transition matters affecting the Reliance estate and Ugly Duckling. PRESLEY COMPANIES: Receives Non-Binding Acquisition Offer --------------------------------------------------------- The Presley Companies (NYSE: PDC) announced the receipt of a non-binding proposal from William Lyon, Chairman of the Board of the Company, to acquire (through a wholly-owned corporation, William Lyon Homes, Inc.), all of the outstanding stock of the Company in a series of related transactions for a cash price of $0.40 per share. The proposal was submitted on June 30, 1998, to a Special Committee of the Board of Directors formed by the Company to evaluate strategic alternatives. The proposal is conditioned on the negotiation and execution of a definitive agreement, completion of due diligence, certain amendments of the Company's 12.5% Senior Notes, and regulatory, stockholder and other approvals, and will be evaluated by the Special Committee. Pending financial and legal review of the terms and conditions of the proposal, the Company will not have any comment nor make any determination on the merits of the proposal. The proposal, by its terms, will expire on July 31, 1998, unless accepted prior to that date. TIE/COMMUNICATIONS: Seeks Order Authorizing Sale ------------------------------------------------ On July 21, 1998 Judge James N. Barr will consider the motion of the debtor, TIE/Communications, Inc to sell free and clear of liens and interests substantially all of the property of the estate and to assume and assign executory contracts and leases to Convergent Communication Services, Inc. The purchase price consists of the assumption of certain substantial liabilities and $40 million in cash, payable upon closing. Convergent will assume or pay certain identified full or partial cure amounts with respect to certain contracts consisting of $221,632 owed under the Mitel Elite Dealer Agreement, $649,347 under the Northern Telecom, Inc. distributorship agreement, $650,000 under the Phoenix Network, Inc. distribution agreement, $798,536 under the Sprint North Supply distribution agreement and $100,000 under the MCI- special customer arrangement. Convergent shall also assume liability for current employee insurance policies, not to exceed $650,000. To be considered at the Sale Hearing an overbid must be accompanied by the bidder's financial ability to perform as well as a deposit of $1.5 million in cash. $1.25 million of any such overbid may be used by debtor to pay the break- up fee to Convergent. All further qualifying overbids must include cash increments of at least $1 million. TOLLYCRAFT: Completes Negotiations with 2 Largest Creditors ----------------------------------------------------------- Tollycraft Corp. reported to the SEC that it has completed its negotiations with two of its largest creditors to convers its total debt of approximately $14,000,000 to equity. This conversion will represent 100% payment to all of its creditors as of June 30, 1998. The conversion will be in the form of free trading preferred shares of Tollycraft stock. In addition to the shares being issued each creditor will receive warrants to purchase additional common shares of Tollycraft stock. The warrant package will be available to preferred shareholders as of specific dates over the next 36 months. TRI-CITY HEALTH: Files for Bankruptcy Protection ------------------------------------------------ Tri-City Health Centre Inc. filed for bankruptcy protection in federal court Friday, delaying a foreclosure sale on the 137-bed Dallas hospital that was planned for next week. The Chapter 11 bankruptcy petition caps months of dueling lawsuits between board members and bondholders at Tri-City, located in the Pleasant Grove neighborhood. Earlier this week, a visiting state district judge ruled that the bondholders could proceed with plans to foreclose on the hospital on Tuesday. While bankruptcy filings are uncommon among hospitals, Tri- City's lawyers say their request won't affect employees or daily operations. Under Chapter 11, Tri-City can continue operating normally while it completes a reorganization plan and tries to restructure its bond agreements. "The board believes that at the end of the process, when the Chapter 11 plan is confirmed, the hospital will be even healthier and even more stabilized and ready to go into the next century," said Chris Luna, Tri-City's general counsel. "The board sees it as a positive opportunity." The Bank of New York, which acts as trustee for the bondholders, has alleged that the nonprofit hospital defaulted on its bond agreements, which are worth $18 million. Specifically, the bank contends that Tri-City violated requirements to keep minimum balances in its checking and savings accounts. Bank lawyers said Friday that they are reviewing their options but are not surprised by the latest turn of events. They have not decided whether to ask U.S. Bankruptcy Judge Steven A. Felsenthal to appoint a trustee or dismiss the case altogether. "Unless the defaults are cured, the trustees are obligated to proceed. As far as we can tell, they {the bondholders} are not prepared to back off." According to the two-page bankruptcy filing, Tri-City's assets are between $10 million and $50 million, the same range as its debts. From the start, Tri-City's lawyers have argued that the hospital is not in monetary default of its bond agreements and has not missed a scheduled payment to its bondholders. The hospital's chief worry, lawyers say, is that the bondholders want to uproot Tri-City's community mission. "This board wants to keep this as a nonprofit, community- based hospital," Mr. Luna said. "Bondholders have in the past expressed the desire to either suck the cash out of the hospital and close it or take it for profit. Either one of those does not serve the needs of the community." The bondholders, led by Naples, Fla., investor Dan Carter, could not be reached for comment Friday. They have said previously that they support the hospital's community mission and have problems only with the hospital's board. Tri-City's lawyers said they considered other legal options, such as appeals, to avoid filing for bankruptcy. But with time running out and settlement discussions going nowhere - they felt they had no other options, Mr. Luna said. Bankruptcy lawyer Richard Grant, of Sheinfeld, Maley & Kay in Dallas, said he expects the case to take six to eight months to reach completion. Located on Scyene Road in southeast Dallas, Tri-City employs about 300 people and serves a largely minority community. (Dallas Morning News 04-Jul-1998) TRITEAL CORP: Unaudited Fourth Quarter Financial Results -------------------------------------------------------- TriTeal Corporation announced unaudited results for its fourth quarter ended March 31, 1998. Revenues for the three months ended March 31, 1998 were $626,000, down from revenues of $1.3 million (restated) for the same quarter in the prior fiscal year. Net loss for the fourth quarter of fiscal 1998 was $5.1 million, or $0.45 per share, compared with a net loss of $3.6 million, or $0.37 per share (restated), for the same quarter in the prior fiscal year. Revenues for the fiscal year ended March 31, 1998 were $3.7 million, compared with revenues of $8.5 million (restated) for the fiscal year ended March 31, 1997. Net loss for the fiscal year ended March 31, 1998 was $18.7 million, or $1.69 per share, compared to a net loss of $7.7 million, or $0.94 per share (restated), for the fiscal year ended March 31, 1997. At March 31, 1998, the Company had $27.2 million in cash, cash equivalents, and short-term investments, representing 90% of total assets. WESTERN FIDELITY FUNDING: Court Approves Financial Advisor ---------------------------------------------------------- The Court approved the application of the debtor, Western Fidelity Funding Inc. to employ Gelfond Hochstadt Pangburn & Company as financial advisor to the debtor. WORK RECOVERY INC: $2 Million Line of Credit -------------------------------------------- Subsequent to emerging from bankruptcy, the Company has received a total of $2,000,000 from a $2,000,000 line of credit from Allsup Inc. and Quest Trading, Inc. The loan is secured by a security interest in all of the Company's personal property, including its intellectual property. The Lenders previously extended the loan maturity date from December 31, 1997 to April 16, 1998 and then to May 15, 1998. However, the Company has subsequently received a notice of default from the lenders and is currently attempting to negotiate an additional extension of the loan maturity date. (States SEC News 02- Jul-1998) Meetings, Conferences and Seminars ---------------------------------- July 2-5, 1998 NORTON INSTITUTES ON BANKRUPTCY LAW Western Mountains Bankruptcy Law Institute Jackson Lake Lodge, Jackson Hole, Wyoming Contact 1-770-535-7722 July 16-19, 1998 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Sea Crest Resort, Falmouth, Massachusetts Contact: 1-703-739-0800 July 23-24, 1998 THE PRACTICING LAW INSTITUTE How to Handle Consumer Bankruptcy Cases: A Practical Step-by-Step Guide PLI Conference Center, New York City Contact: 1-800-260-4PLI July 23-25, 1998 AMERICAN LAW INSTITUTE-AMERICAN BAR ASSOCIATION Chapter 11 Business Reorganizations (Advanced Course) Santa Fe, New Mexico Contact: 1-800-CLE-NEWS July 24-27, 1998 NATIONAL ASSOCIATION OF CHAPTER 13 TRUSTEES 33rd Annual Seminar Portland Marriott, Portland, Oregon Contact: 1-601-355-6661 July 24-29, 1998 COMMERICAL LAW LEAGUE OF AMERICA 104th Annual Convention Ritz Carlton, Amelia Island, Florida Contact: 1-312-781-2000 August 6-9, 1998 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop Daufuskie Island Club & Resort, Hilton Head, South Carolina Contact: 1-703-739-0800 September 9-13, 1998 NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES Annual Convention Sheraton El Conquistador, Tuscon, Arizona Contact: 1-803-252-5646 September 17-20, 1998 AMERICAN BANKRUPTCY INSTITUTE Southwest Bankruptcy Conference The Inn at Loretta, Santa Fe, New Mexico Contact: 1-703-739-0800 September 17-20, 1998 COMMERCIAL LAW LEAGUE OF AMERICA Midwest Mid-Year Meeting Oak Brook Hills Resort & Hotel Oak Brook, Illinois Contact: 1-616-372-6500 September 21-23, 1998 STATES' ASSOCIATION OF BANKRUPTCY ATTORNEYS 7th Annual States' Taxation and Bankruptcy Conference Hotel Santa Fe, Santa Fe, New Mexico Contact: 1-505-827-0728 September 25-26, 1998 VIRGINIA CONTINUING LEGAL EDUCATION 13th Annual Mid-Atlantic Institute on Bankruptcy and Reorganization Practice Boar's Head Inn, Charlottesville, Virginia Contact: 1-800-979-8253 October 8-10, 1998 AMERICAN LEGAL INSTITUTE-AMERICAN BAR ASSOCIATION Real Estate Defaults, Workouts, and Reorganization Charleston, South Carolina Contact: 1-800-CLE-NEWS October 16-20, 1998 TURNAROUND MANAGEMENT ASSOCIATION 1998 Annual Conference The Westin Hotel, Chicago, Illinois Contact 1-312-857-7734 October 22-25, 1998 NATIONAL CONFERENCE OF BANKRUPTCY JUDGES 72nd Annual Meeting Wyndham Anatole Hotel, Dallas, Texas Contact 1-803-957-6225 November 30-December 1, 1998 RENAISSANCE AMERICAN CONFERENCES & BEARD GROUP, INC. 5th Annual Conference on Distressed Debt Plaza Hotel, New York, New York Contact 1-903-592-5169 or ram@ballistic.com December 3-5, 1998 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Westin La Paloma, Tuscon, Arizona Contact: 1-703-739-0800 February 18-21, 1998 COMMERICAL LAW LEAGUE OF AMERICA Annual Western District Meeting Monte Carlo Hotel & Casino Resort, Las Vegas, Nevada Contact 1-702-382-9558 April 26-27, 1999 RENAISSANCE AMERICAN CONFERENCES & BEARD GROUP, INC. Bankruptcy Sales, Mergers & Acquisitions The Mark Hopkins, San Francisco, California Contact 1-903-592-5169 or ram@ballistic.com The Meetings, Conferences and Seminars column appears in the TCR each Tuesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. ********* The Meetings, Conferences and Seminars column appears in the TCR each Tuesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. Bond pricing, appearing each Friday, is supplied by DLS Capital Partners, Dallas, Texas. S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter, co- published by Bankruptcy Creditors' Service, Inc., Princeton, NJ, and Beard Group, Inc., Washington, DC. Debra Brennan and Lexy Mueller, Editors. Copyright 1998. All rights reserved. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re- mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *