/raid1/www/Hosts/bankrupt/TCR_Public/990201.MBX
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, February 1, 1999, Vol. 3, No. 21
Headlines
ACME METALS: Key Employee Retention Plan
AMERICAN RICE: Committee Objects To Financial Advisors
AMERICAN RICE: Seeks To Settle Adversary Proceeding
AMERICAN TRACK: Seeks Bankruptcy Protection
BMJ MEDICAL: Committee Taps Klehr, Harrison
BOSTON BED: to Close Remaining 23 Stores
BRADLEES: Set For Immediate Expansion
D&L VENTURE: Seeks to Continue and Exted Financing
DEVELCON ELECTRONICS: Announces Results for Fiscal Year
FALLS LEATHER: Gallery Files Chapter 11
FPA MEDICAL: Prudential Objects To Disclosure Statement
HOMEPLACE STORES: Seeks Extension To Assume/Reject Leases
INTERNATIONAL WIRELESS: Vanguard Slams Plan Critics
JUMBOSPORTS: Seeks Financing From Foothill Capital
LIVENT: Arrest Warrants Issued for Co-founders
LOGAN SQUARE: Court Approves Sale To Fountains Continuum
MARVEL: Announces Sale of Fleer/Skybox International
NU-KOTE: Committee Taps Arthur Andersen
PCG CORP I: Hearing Set For Disclosure Statement
POCKET COMMUNICATIONS: Notice of Sale of Assets
SALANT CORP: Sinha Appointed Exec. Vice President and CFO
SGL CARBON: Objection To Filing Documents Under Seal
SMARTALK: Announces Management Transition
SOLO SERVE: Hearing On Inventory Liquidation Deferred
SUN TV: Bar Date Set For March 15
TOSHOKU AMERICA: Confirmation of Plan
WINTERSILKS: Plan of Reorganization
*********
ACME METALS: Key Employee Retention Plan
----------------------------------------
Acme Metals Incorporated and its debtor affiliates seek
entry of an order authorizing the Acme Debtors to implement
a key employee retention plan. There are three components
to the retention plan: a performance-based component, a
retention payment component, and a severance component.
At current salaries, if all of the participants earned
their target incentive payment, the total annual cost of
the performance bonuses for 1999 would be approximately
$1.8 million. If all designated participants remain with
the company, the total annual cost of the retention
component of the plan would be about $1.1 million.
The average lump sum severance payment total would be
approximately $1.21 million.
The Acme debtors submit that sound business justifications
exist for the approval of the retention plan. The Acme
debtors are facing the very real risk that a number of key
employees will leave their positions with the Acme debtors
in favor of more secured employment. And the debtors
submit that the retention of their key employees will
enable the debtor to maintain a stable management team
which is critical to the debtors' realization of their
business goals.
AMERICAN RICE: Committee Objects To Financial Advisors
------------------------------------------------------
The Official Committee of Unsecured Creditors for American
Rice Inc. objects to the application to employ Imperial
Capital as exclusive financial advisors and agent of the
debtor.
The services that Imperial proposes to render include
assistance with the preparation of materials describing the
debtor, its operations, performance and future prospects;
identification of qualified purchasers/providers of the
proposed financing; and determining the form and structure
of such financing.
The Committee states that Imperial has retail customers and
accounts which hold approximately $7,110,500 in the
debtor's debt securities; Imperial's trading account holds
approximately $1,776,000 in debtor's debt securities; and
Avalon, a hedge fund managed by Imperial employees, holds
approximately $1.625 million in debt securities.
The Committee states that while Imperial has established a
"Chinese Wall" to partition members dealing with the
debtor's debt securities form those to be providing
services as described herein, the firm is not
"disinterested". The Committee states that the duty owed
by the debtor to its creditors could never be properly
shared or protected by Imperial. Further, the Committee
states that Imperial, as creditor and /or equity holder,
holds an interest materially adverse to the Committee and
the constituents.
AMERICAN RICE: Seeks To Settle Adversary Proceeding
---------------------------------------------------
The debtor, American Rice, Inc. seeks court authority to
settle the claims and disputes that are the subject of an
adversary proceeding filed by MDFC Equipment Leasing
Corporation.
ARI and MDFC seek to avoid further litigation and to settle
the claims and counterclaims asserted in the adversary
proceeding, stemming from the lease by MDFC of equipment
and real property at an olive plant in Visalia, California.
ARI shall receive in satisfaction of all avoidance actions
against MDFC the sum of $2 million from the escrowed funds.
MDFC shall receive the remainder of the escrowed funds,
including interest, but in no event less than $6.14 million
and MDFC shall retain the Letter of Credit Proceeds.
MDFC shall have an allowed unsecured claim of $2 million in
debtor's bankruptcy case, not subject to offset or
objection.
The adversary and all claims and counterclaims that have or
could have been brought therein shall be dismissed whit
prejudice.
The debtor's $2 million settlement recovery constitutes the
post-petition collateral granted to debtor's working
capital lenders pursuant to the terms of the fifth
amendment to the restated credit agreement approved by the
court. Upon receipt of the settlement proceeds, debtor
will deposit 20% of the funds into a trust account for
payment of allowed professional fees and the remainder will
be paid to the working capital lenders for permanent
application against postpetition indebtedness in accordance
with the terms of the final financing order.
AMERICAN TRACK: Seeks Bankruptcy Protection
-------------------------------------------
American Track Systems International Inc., Altoona, Pa.,
filed for chapter 11 protection in the District of
Delaware, according to Reuters. The rail technology
manufacturer listed up to $500,000 in assets and up to $10
million in liabilities. The Western District of
Pennsylvania dismissed a 1998 chapter 11 filing for
improper filing, and Chairman Hans von Lange said that he
decided to refile chapter 11 to protect the company from
dismemberment. He said the filing was precipitated by
American Track Systems' inability to dissuade two small
creditors from scheduling a sale of office assets on
Tuesday. The largest unsecured claim is a disputed one for
$2.5 million by Allevard Stedel SAS, a French rail products
manufacturer. Last June, Allevard formed a venture with
American Track Systems that included a $2 million revolving
line of credit. (ABI 29-Jan-99)
BMJ MEDICAL: Committee Taps Klehr, Harrison
-------------------------------------------
The Official Committee of Unsecured Creditors seeks to
retain Klehr, Harrison, Harvey, Branzburg & Ellers LLP
as counsel to the committee, effective as of January 14,
1999.
The Committee believes that Klehr, Harrison is well
qualified to represent the Committee in these cases. The
firm will charges for its services on an hourly basis. Its
fees range from $85 per hour for paralegals to $300 per
hour for partners.
BOSTON BED: to Close Remaining 23 Stores
----------------------------------------
Three months after it filed chapter 11, 28-year-old Boston
Bed & Bath announced that it will close its 23 remaining
stores and cut 500 jobs as a result, according to Reuters.
The Norwood, Mass.-based home products retailer said it was
unable to reorganize after the filing, and this week
informed employees that it will liquidate operations at all
stores, starting this weekend. Stewart Cohen of Paragon
Capital, which has been lending the retailer money for a
year, told the Boston Globe that there was not an official
determination of what would become of the retailer. When
the company filed, it had assets of about $19.13 million
and liabilities of $26.9 million. (ABI 29-Jan-99)
BRADLEES: Set For Immediate Expansion
-------------------------------------
Discount retailer Bradlees Inc. will emerge from the gates
of Chapter 11 next week set for immediate expansion, Chief
Executive Officer Peter Thorner said on Friday.
"We'll be looking for expansion ... there are some
fortuitous opportunities that have come about, most
recently with the Caldor wind-down," Thorner said
in an interview from the company's Braintree,
Massachusetts, headquarters.
Discount retail competitor Caldor Corp., which itself has
been struggling with bankruptcy for three years, said last
week it would go out of business this spring and shutter
145 stores in the Northeast.
Thorner declined to say what Caldor assets would be
targeted. But the size and location of many Caldor stores
may be too good to pass up, he said.
"We haven't yet built anything in (our sales plan) for any
transfer sales from Caldor ... and I really think we stand
a chance of getting a substantial amount of sales
transferring from former Caldor customers," Thorner said.
A bankruptcy court approved Bradlees's reorganization plan
this week, allowing the chain to emerge from Chapter 11
within a few days, he said.
Thorner said Bradlees has recanted its strategy of the
early 1990s of trying to create a niche between department
stores and discounters by targeting higher income
customers. "We took a very loyal customer at Bradlees and
scared them away," he said.
He said the business would be rebuilt to include about 11
percent more apparel and "soft" home merchandise because it
represents higher profit margins. For 1998, Thorner said
comparable store sales should be up between three
and four percent over 1997. He said sales through January
28 were 15 percent above the same month last
year on a same-store basis. But the October to December
quarter was relatively flat due to unseasonably warm
weather, he added.
D&L VENTURE: Seeks to Continue and Exted Financing
--------------------------------------------------
D&L Venture Corp., et al., debtors, seek approval of the
debtors' motion seeking authority to continue and extend
post-petition secured financing agreement with Paragon
Capital LLC and to establish a bar date for administrative
claims.
The debtors seek an extension of the Maturity Date as
defined in the Financing Motion of their post-petition
financing agreement with Paragon Capital LLC until March
16, 1999.
DEVELCON ELECTRONICS: Announces Results for Fiscal Year
-------------------------------------------------------
Develcon Electronics Ltd. (Toronto, Canada) announced its
audited results for its 4th quarter and fiscal year ended
August 31, 1998 and provided an update on its current
financial condition and its continuing efforts to resolve
the financial constraints facing the Company.
Develcon's results for the three months ended August 31,
1998 reflect a loss before interest, finance charges,
taxes, depreciation and amortization ("EBITDA") of
$1,232,000 compared to a profit of $71,000 in the previous
year. Fourth quarter revenues were adversely impacted by
the Company's continuing inability to procure components
due to cash shortages. At the year-end, the Company had an
order backlog in excess of $3.5 million which could not be
shipped because of these shortages.
The Company's loss for the year before interest, finance
charges, taxes, depreciation and amortization was
$2,170,000 compared to $359,000 in the previous year. After
interest, finance charges, depreciation and amortization,
the loss was $4,773,000 compared to a loss of $12,460,000
in 1997. Last year's loss included a total charge of
$9,972,000 for the write-off of impairment in
goodwill and amortization during the year. Revenues for the
year were $19.2 million compared to $18.9 million in the
previous year.
The Company has extended, either on a demand basis or until
early February 1999, two loans which became due in early
December. The repayment of the principal of these loans, in
the amounts of U.S. $530, 000 and Cdn. $650,000,
has been extended while Develcon continues to work with
Vianet Technologies to re-structure a previously-announced
financing. Develcon also continues to work with other
lenders in regard to obtaining waivers of breaches by it of
loan covenants.
As at August 31, 1998, and at the present time, the Company
is in default of certain debt covenants and is unable to
pay its suppliers within normal trade terms. Due to its
breach of these loan covenants the Company has classified
on its balance sheet most of its long-term debt as current
liabilities which has created a working capital deficiency
in the presentation of the 1998 statements.
The Company and Vianet continue to explore alternative
approaches which would result in Vianet providing
additional working capital to the Company and
causing approximately $6.0 million of Develcon debt to be
converted into equity of Vianet. The Company hopes to
finalize these arrangements in the near future, in order to
avoid a demand for re-payment of its loans, restore normal
payment term relationships with its trade creditors, cure
any defaults under existing loan agreements and properly
finance its future growth. The Company is assessing other
alternatives to maximize value for stakeholders in
the event these arrangements cannot be finalized in the
near future.
Develcon Electronics Ltd. (TSE:DLC) is a global provider of
enterprise network solutions and LAN/WAN connectivity.
FALLS LEATHER: Gallery Files Chapter 11
---------------------------------------
Family-owned Falls Leather Gallery, Miami, has filed for
chapter 11 protection, according to The Sun-Sentinel. The
company's debt is likely to total $4 to $5 million,
according to bankruptcy attorney. The 25-year-old company
owes its biggest supplier, an Italian leather furniture
manufacturer called Natuzzi, $1 million. President Eric
Salem said that Falls does not plan to close any of its
nine stores or lay off employees, although some 20 workers
were already laid off and a Miami Beach store was closed.
He said that the vendors are being cooperative and the
employees are motivated. Salem also said that the stores
have been profitable on an operating basis, but that
overhead expenses became too high. (ABI 29-Jan-99)
FPA MEDICAL: Prudential Objects To Disclosure Statement
-------------------------------------------------------
Prudential Insurance Company of America and certain of its
subsidiaries object to the proposed revised disclosure
statement of FPA Medical Management Inc. and its
subsidiaries and affiliates.
Prudential states that the Disclosure Statement should not
be approved because it describes a plan which is
unconfirmable and does not contain adequate information.
The plan is not feasible because the Disclosure statement
fails to identify a means of implementing the plan. There
is no agreed upon exit financing and the debtors have not
secured agreements with their payors, which will provide
the majority of the reorganized debtors' cash flow.
Secondly, Prudential alleges that the plan affords broad
releases to certain nondebtor parties without adequate
consideration.
HOMEPLACE STORES: Seeks Extension To Assume/Reject Leases
---------------------------------------------------------
HomePlace Stores, Inc. seeks an extension of time to assume
or reject unexpired nonresidential real property leases
until the earlier to occur of (i)the date the court enters
an order confirming a plan or plans of reorganization and
(ii) May 31, 1999.
The members of the HomePlace Group are tenants under
approximately eighty unexpired nonresidential real property
leases. In connection with its efforts to formulate a plan
of reorganization, the HomePlace Group has continued to re-
evaluate every aspect of its business including the
profitability of each of its operating stores. Since the
Petition Date, the debtor closed 23 of its unprofitable
stores, and hired Retail Consulting Services to help
negotiate rent reductions on leases.
Given the importance of the leases, HomePlace Group wishes
to evaluate fully each of the leases to determine what
action would be in the best interests of the HomePlace
Group's estates. Management has been extensively involved
in the development of a business plan. The debtor has also
been involved in extensive litigation with landlords and
purported fixture lessors.
The HomePlace Group asserts that it should not be compelled
to assume large numbers of leases for operating stores (or
prematurely reject leases that may be valuable) without the
benefit of the formulation of a revised store model and a
comprehensive business plan that will be implemented
through a plan or plans of reorganization.
INTERNATIONAL WIRELESS: Vanguard Slams Plan Critics
---------------------------------------------------
Vanguard Cellular Systems Inc., International Wireless
Communications Holdings Inc.'s("IWCH") largest shareholder,
responded to the widespread criticism of the
company's reorganization plan by trumpeting the plan's
dependence on Vanguard's contributions. "The releases at
issue constitute fundamental consideration to
Vanguard for that reorganization plan. Simply put, without
Vanguard's contributions under the plan, no reorganization
is possible," Vanguard's Jan. 22 response asserts. Former
shareholders of IWCH's Radio Movil Digital America Inc.
subsidiary, who received IWCH shares in exchange for their
4.8 percent ownership interest in the unit after a Jan. 23,
1998, merger, objected to the plan because, among other
things, the releases of claims proposed by the plan would
moot their securities fraud action against former and
current IWCH officers and Vanguard without any
compensation. Vanguard argued that, "contrary
to the impression Minority Shareholders seek to convey,"
Vanguard has not benefited from IWCH's misfortune. In its
role as a substantial shareholder, Vanguard has suffered
greater losses than the minority shareholders."
(The Daily Bankruptcy Review and ABI Copyright c January
29, 1999)
JUMBOSPORTS: Seeks Financing From Foothill Capital
--------------------------------------------------
JumboSports Inc., as debtor together with its affiliated
debtors seek to borrow on a secured basis from Foothill
Capital Corporation, Congress Financial Corporation and
Foothill Partners II, LP the sum of $135,000,000 (DIP
Facility). One of the conditions precedent to the closing
of the DIP Facility is the existence of $8 million of
unrestricted cash in the debtors' operating accounts. At
present, the debtors have approximately $25 million in
unrestricted cash and believe that they will easily meet
the condition that they have $8 million of unrestricted
cash at closing.
LIVENT: Arrest Warrants Issued for Co-founders
----------------------------------------------
After Garth Drabinsky and Myron Gottlieb, co-founders of
bankrupt Livent Inc., failed to appear in federal court
yesterday to face fraud charges, a Manhattan magistrate
judge ordered that warrants be issued for their arrest in
the United States, according to Reuters. Although the
warrants apply only in the United States, it is expected
that U.S. Attorney Mary Jo White will soon begin
proceedings seeking their extradition from Canada.
Drabinsky and Gottlieb were named in a 16-count indictment
that alleged they profited from a scheme in which they hid
Livent's losses and inflated its earnings to defraud
investors out of tens of millions of dollars. They were
also named in a related civil suit filed by the U.S.
Securities and Exchange Commission.
An attorney for Gottlieb said the U.S. government could not
consider his client a fugitive and that a U.S. trial would
be inappropriate since both defendants are Canadian
citizens. Prosecutors allege, however, that the scheme
included kickbacks, falsification of records and lying to
Wall Street analysts. They are also charged in the
SEC civil case with getting outsiders to buy tickets to a
1997 Los Angeles production of Ragtime to inflate ticket
sales reported to Variety magazine. If sales fell below a
certain level for the production, the company's L.A.
landlord could have evicted the company. Poor sales in Los
Angeles also could have undermined the planned New York
opening on Broadway in 1998. (ABI 29-Jan-99)
LOGAN SQUARE: Court Approves Sale To Fountains Continuum
--------------------------------------------------------
Logan Square East, a Debtor in Possession in a Chapter 11
bankruptcy proceeding in the United States Bankruptcy
Court for the Eastern District of Pennsylvania
(Philadelphia), announced today that it has obtained
approval from the Court to sell its facility to Fountains
Continuum of Care Inc. ("The Fountains") for a purchase
price comprised of $26,600,000 in cash and the assumption
of certain liabilities (the "Purchase Price").
The Purchase Price is subject to reduction through certain
holdbacks and deferred maintenance obligations. The
Purchase Price does not satisfy the total amount of Logan
Square East's secured and unsecured debt, including, in
particular, the Amended First Mortgage Revenue Bonds,
issued in 1991, of which approximately $36 million remain
outstanding.
On Dec. 2, 1998 Logan Square East announced its decision to
enter into a Purchase and Sale Agreement with The Fountains
for a purchase price of $24,187,000 together with
assumption of certain liabilities.
Thereafter, in accordance with bidding procedures
established by the Court, Logan Square East received a
competing joint offer from American Retirement Corp. and
Acorn Company, LLC for $25,246,000 in cash together with
assumption of certain liabilities.
After spirited bidding in Court, The Fountains prevailed
and Logan Square East's creditors will get the benefit of
the $2,413,000 above The Fountains' original bid. Closing
is anticipated for not later than June 1, 1999, but a
precise date can not be set until certain closing
conditions have been fulfilled.
Logan Square East will be addressing creditor claims in a
plan of reorganization to be filed shortly.
The Fountains, headquartered in Tucson, Arizona, is a
nationally recognized owner and operator of life care
communities and retirement facilities.
Logan Square East, constructed in 1982, is a non-profit
continuing care retirement community located in center city
Philadelphia, Pennsylvania. The Logan Square East community
consists of a 24 story modern high rise building
that contains 327 independent living units, 17 personal
care units and 128 intermediate and skilled nursing beds.
MARVEL: Announces Sale of Fleer/Skybox International
----------------------------------------------------
Marvel Enterprises, Inc. (NYSE: MVL) announced today that
it has entered into a definitive agreement for the sale of
Fleer/Skybox International, its trading card business, for
a purchase price of $26 million in cash to a newly formed
private company founded by Alex Grass and his son Roger
Grass. Alex Grass is the founder of Rite Aid Corporation
and currently serves as a director of Rite Aid and Hasbro,
Inc.
Consummation of the sale is subject to the satisfaction of
certain conditions, including obtaining the consents of
certain of Fleer/Skybox's licensors, as well as Marvel's
lenders. The transaction is not subject to financing and
is currently expected to close in mid-February.
Eric Ellenbogen, President and CEO of Marvel, commented,
"As anticipated, the sale of these non-core assets is a big
step toward focusing our business on media and toys.
Anchored by one of the largest character-based
entertainment libraries in the world, we are assembling a
strong management team that will exploit Marvel's
characters across the full range of distribution outlets."
NU-KOTE: Committee Taps Arthur Andersen
---------------------------------------
Nu-Kote Holding, Inc. and its affiliated debtors apply to
authorize the employment and retention of Arthur Andersen
LLP as accountants and financial advisors to the Unsecured
Creditors' Committee of Nu-Kote International, Inc.
The Committee seeks to retain Andersen as special
bankruptcy accountants and financial advisor. The
professional services to be rendered by Andersen include
the following:
Review of all bankruptcy statements, schedules and
operating reports.
Review of financial budgets and comparative performance
against budget.
Valuation of assets, divisions, subsidiaries, and
enterprise if appropriate.
Analysis of business plans and future enterprise viability.
Strategic assessment and valuation of any non-debtor
subsidiaries.
Review of any plan of reorganization and disclosure
statement prepared by the debtors.
Assistance with preparation or review of any competing plan
of reorganization if appropriate.
Review of substantive consolidation and liquidation
analyses if appropriate.
Andersen will charge for its services on an hourly basis
ranging from $140 per hour for seniors to $350 per hour for
partners.
PCG CORP I: Hearing Set For Disclosure Statement
------------------------------------------------
A hearing will be held on February 25, 1999 at 11:00 AM in
Courtroom 617 of the United States Bankruptcy Court,
Southern District of New York, One Bowling Green, New York,
New York 10004, to consider the Disclosure Statement of the
debtors, PCG Corp. I, et al.
A brief summary of the classification and treatment of
claims and interests under the plan:
Class 1: Allowed Administrative claims (approximately $2.7
million) 100% recovery.
Class 2: Allowed fee claims (approximately $2.4 million)
100% recovery.
Class 3: Allowed priority claims ($0) 100% recovery.
Class 4: Allowed priority tax claims (approximately
$596,000) . 100% recovery.
Class 5: Allowed Secured Claims ($0). 100% recovery.
Class 6: Allowed General Unsecured Claims (Approximately
$138 million) Distributions to Class 6 creditors should
ultimately realize less than 1%. However, there can be no
assurances that distributions will achieve such a level.
Class 7: Old Preferred stock. No distribution. Canceled as
of Effective Date.
Class 8: Subsidiary Stock. No distribution. Canceled as of
Effective Date.
Class 9: Old Common Stock. No distribution. Canceled as of
Effective Date.
Class 10: Warrants. No distribution. Canceled as of
Effective Date.
Class 11: Options. No distribution. Canceled as of
Effective Date.
Pursuant to an Asset Purchase Agreement, Hartmarx
Corporation acquired substantially all of the debtors'
tangible and intangible assets in exchange for the payment
of $36 million in cash, the payment of 2% of Hartmarx's
actual sales revenue in respect of brands acquired from the
debtors during the first year following closing and for
three years thereafter but only in excess of $107.5
million, and the assumption of approximately $7.1 million
of the debtors' liabilities by Hartmarx.
POCKET COMMUNICATIONS: Notice of Sale of Assets
-----------------------------------------------
Pocket Communications Inc., DCR PCS, Inc., debtors, The
Official Committee of Unsecured Creditors, Pacific Eagle
Investments, Ltd., Pacific Eagle Investment (L) Limited,
Masa Telecom Asia Investment Pte. Ltd, Ericsson Inc. and
Siemens Information and Communication Networks, Inc.
("lenders") filed a joint motion for approval for the
debtors to sell certain assets pursuant to a stipulation
and order.
Pursuant to the agreement the lenders will allocate
$600,000 to purchase agreed priority claims and agreed
unsecured claims on a pro rata basis, the lenders will
purchase agreed administrative claims at a discount for an
aggregate of $2.9 million. The lenders will waive the
purchased claims against the debtors' estates and
prepetition advances by Pocket to DCR will be determined to
be capital contributions and not intercompany loans.
The debtors argue that the benefits to the estates from the
sale of the avoidance actions are substantial. If all
creditors tender their claims for purchase, the lenders
will waive claims aggregating more than $46 million against
the estates in consideration for an assignment of the
avoidance actions.
Absent the settlement, creditors would have to rely almost
exclusively on a sale of the elected licenses to generate
funds for distribution on claims. The debtors and the
Committee would have to prevail in litigation regarding the
proper characterization of Pocket's prepetition advances to
DCR before unsecured creditors could receive any payment.
A hearing on the proposed sale has been scheduled on
February 12, 1999 at 11:30 AM at the U.S. Bankruptcy Court,
Courtroom 9-C, 101 W. Lombard Street, Baltimore, Maryland
21201.
SALANT CORP: Sinha Appointed Exec. Vice President and CFO
---------------------------------------------------------
Salant Corporation (OTC Bulletin Board:SLNT) today
announced the appointment of Awadhesh Sinha as Executive
Vice President and Chief Financial Officer of Salant. Mr.
Sinha previously was Executive Vice President Operations
and Chief Financial Officer of the Perry Ellis Menswear
division of Salant. He will continue to report to Michael
J. Setola, Chairman of the Board and Chief Executive
Officer. Philip A. Franzel, Salant's former Executive Vice
President and Chief Financial Officer, has agreed to assist
Salant to ensure a smooth transition.
Commenting on today's announcement, Mr. Setola stated,
"This promotion recognizes the contributions Awadhesh has
made to our Company. For many years, Awadhesh has served
as the senior financial and operational officer for our
Perry Ellis Menswear division. As we move to a Perry Ellis
only company at Salant, Awadhesh is the ideal partner to
assist us in realizing our financial and operational
objectives. He is an important member of our senior
management team, and I look forward to his continuing
contributions."
"At the same time, I would like to thank Phil Franzel for
his efforts and, particularly, his role in managing
Salant's financial restructuring," Mr. Setola said.
As previously announced, under Salant's pre-negotiated
Chapter 11 restructuring plan, Salant, currently a chapter
11 debtor, intends to focus solely on its Perry Ellis
men's apparel business and, as a result, exit its other
businesses.
SGL CARBON: Objection To Filing Documents Under Seal
----------------------------------------------------
SGL Carbon Corporation, debtor, objects to the motion of
the Official Committee of Unsecured Creditors for an order
granting leave to file certain documents under seal.
The debtors states that the Motion to Seal is an "example
of mischief bound to result" when the Committee is
dominated by holders of nominal claims in this case solely
because they have asserted antitrust claims against the
debtor.
By depriving access to information, the Committee seeks to
prevent a reasoned response to the motion to dismiss by the
debtor's unsecured creditors who do not share the antitrust
plaintiffs' motivation in seeking to have this case
dismissed.
The debtor states that the motion to seal should be denied
to the extent it seeks to preclude parties-in-interest in
this case from accessing all of the materials filed in
support of the motion to dismiss.
SMARTALK: Announces Management Transition
-----------------------------------------
SmarTalk TeleServices, Inc. (OTC:SMTKQ) announced the
departure of Erich Spangenberg as Chief Executive Officer
and as a member of the Board of Directors. Mr. Spangenberg
will continue as a consultant to the Company at the request
of the Board. Separately, SmarTalk also announced that Jeff
Lindauer is no longer serving as President and Chief
Operating Officer, having departed the Company to pursue
other interests.
The Board of Directors of the Company will be working with
SmarTalk's remaining senior management team to oversee the
Company's day-to-day operations, pending the closing of the
Company's previously-announced sale of substantially all
its assets to AT&T. The Board of Directors may appoint an
interim Chief Executive Officer in the near future and
anticipates that SmarTalk's operations will continue in the
ordinary course without disruption.
SmarTalk Teleservices, Inc. is a leading provider of
prepaid calling cards and prepaid wireless services. Based
in Dublin, Ohio, SmarTalk maintains distribution agreements
with the U.S. Postal Service and leading mass
merchandisers, consumer electronics retailers,
supermarkets, hotels, home office superstores and
convenience stores throughout North America and the U.K.
SOLO SERVE: Hearing On Inventory Liquidation Deferred
-----------------------------------------------------
Solo Serve Corporation (OTC Bulletin Board: SOLO) announced
today that the hearing previously scheduled for Friday,
January 29, 1999 pertaining to the possible exercise by the
Company of an option to liquidate inventory in its
remaining twenty stores has been postponed until 9:00 a.m.,
Tuesday, February 2, 1999. The Company has had
discussions with certain parties interested in acquiring
some or all of the Company's remaining twenty stores.
However, at this point no definitive proposals in
that regard have been received.
The Company expects to make a decision with regard to the
inventory in the remaining twenty stores on or before
February 2, 1999 and may choose to recommend to the
Bankruptcy Court exercise of the option to cause
Hilco/Garcel/Nassi to liquidate the remaining inventory
pursuant to the Agency Agreement approved by the Court on
January 21, 1999. In the event the remaining inventory is
liquidated, the Company would continue to consider
alternative proposals pertaining to the store leases that
might result in continued operation of the stores under new
ownership. None of the alternatives currently available to
the Company would afford any value to the interests of
holders of the Company's common stock or preferred stock.
SUN TV: Bar Date Set For March 15
---------------------------------
Any entity holding a pre-petition claim against either of
the Sun TV Companies must file a proof of claim so that
such proof of claim is actually received no later than 5:00
PM on March 15, 1999.
TOSHOKU AMERICA: Confirmation of Plan
-------------------------------------
A hearing was held on December 10, 1998 at which the U.S.
bankruptcy Court for the Southern District of New York
confirmed the debtor's amended plan of reorganization dated
as of November 17, 1998. All claims against the debtor
shall be treated and deemed satisfied in accordance with
the plan and upon entry of the order dated December 29,
1998 confirming the plan.
WINTERSILKS: Plan of Reorganization
-----------------------------------
The court entered an order approving the first amended plan
of reorganization of the debtor, Wintersilks, Inc.
Treatment of Classes of claims and interests:
Class I: Administrative Claims - Not impaired
Class II: Priority Claims - Not impaired
Class III: Allowed GWI Secured Claim - Impaired - Paid from
the debtor's operating profits over a period of time.
Class IV: Unsecured Claims - Impaired- Holders shall be
paid 61% of their respective allowed claims.
Class V: Interest of holders of existing common stock - Not
impaired. Members of Class V shall retain their ownership
of the interests in the debtor as they existed on the
filing date.
On December 9, 1998, the debtor, Venus Swimwear Inc. and
GWI entered into an agreement that provided for the payment
of GWI's secured claim by February 15, 1999 and authorized
WinterSilks to continue to use GWI's cash collateral. In
addition Venus loaned to Winter Silks the sum of $1 million
on an unsecured basis. Subsequent to the filing date, the
company's president, Vig, purchased from TCW all of TCW's
equity interests in the company. The current interest
ownership of the company is Venus - 51%; Vig-48.7%; all
other interest holders - .3%.
February 22, 1999 at 11:15 AM is fixed as the date for the
hearing on confirmation of the plan.
*********
S U B S C R I P T I O N I N F O R M A T I O N
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Debra Brennan and Lexy Mueller, Editors. Copyright 1998.
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