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/raid1/www/Hosts/bankrupt/TCR_Public/990730.MBX T R O U B L E D C O M P A N Y R E P O R T E R Friday, July 30, 1999, Vol. 3, No. 146 Headlines 1043 DEVELOPMENT: Files Schedule of Assets and Liabilities ACME METALS: Seeks Extension of Exclusivity ADVANCED GAMING: Effective Date of Plan Changed AMNEX INC: Business Segment Being "Shut Down" BOSTON CHICKEN: Wins Nod For Plan Sponsor Procedures BRAZOS SPORTSWEAR: Seeks Extension of Exclusivity BRAZOS SPORTSWEAR: Seeks To Reject Executory Contracts and Leases CORDEX PETROLEUMS: Meeting of Creditors CRIIMI MAE: August 5 Hearing Scheduled DISCOVERY ZONE: CEC Completes Acquisition of Assets GENESIS PHYSICIANS: To File For Bankruptcy GEOGRAPHICS: Year-End Figures Show Operating Loss, Net Income HARNISCHFEGER: Investing in the Wrong Company IFUSION: Order Confirms Plan of Liquidation IMAGYN MEDICAL: Court Approves Committee Counsel JUICY LUCY'S: Files For Bankruptcy Protection NATIONAL CATTLE: To Turn Dog Track Into Stock Car Track NATIONSWAY: Case Summary & 20 Largest Unsecured Creditors NATIONSWAY: Committee Objects To Employee Retention Plan NEXTWAVE: Federal Judge Rejects FCC Claim PHILIP SERVICES: Hearing on Disclosure Statement PITTSBURGH PENGUINS: Lemieux Secures Investments for Penguins PRESTON TRUCKING: Maryland Trucking Company to Shut Down SERVICE MERCHANDISE: Month End Financials Shows Gains & Losses STARTER CORP: To Reject Agreements With Madison Square Garden USA BRIDGE: Hearing to Consider Approval of Disclosure Statement WESTERN FIDELITY: Trustee To Retain Rosania ********** 1043 DEVELOPMENT: Files Schedule of Assets and Liabilities ---------------------------------------------------------- With assets of $12.9 million and liabilities of $29.4 million, 1043 Development Corp. reported that $12.3 million of its debt is owed to secured creditors, according to The Milwaukee Journal Sentinel. Three large trade creditors recently forced the Bayside area developer into bankruptcy. The company has specialized in developing rent-to-own houses for people who have difficulty obtaining conventional financing. 1043 Founder Yogesh Shah listed himself in documents filed Friday as a stockholder and co-debtor of the company. Friday's filing also indicated that the company made $262,000 during the two years ending March 31, 1998; since then the firm has lost $10 million, according to documents. (ABI 29-July-99) ACME METALS: Seeks Extension of Exclusivity ------------------------------------------- The debtors, ACME Metals Incorporated, and its debtor affiliates seek a court order further extending the debtors' exclusive periods within which the debtors may file a plan of reorganization and solicit acceptances thereto. A hearing will be held on August 9, 1999 at 3:00 PM. The debtors request the entry of an order extending their Exclusive Proposal Period and Exclusive Solicitation Period for approximately 66 days, to and including September 30, 1999 and November 30, 1999, respectively. The debtors represent that both the Acme and Alpha Committees consent to this request. The debtors and other financial advisors are currently developing the debtors' going forward business plan, which will provide the framework for the ultimate preparation and negotiation of a plan of reorganization. These cases are large, a bar date was set for June 1, 1999. The debtors' operations have shown improvements, as evidenced by debtors' consolidated EBITDA figures. The debtors have improved EBITDA by over $6 million since the inception of the plan, with June's consolidated EBITDA being over $4 million better than January's. The debtors are developing their business plan. ADVANCED GAMING: Effective Date of Plan Changed ----------------------------------------------- Advanced Gaming Technology Inc. (OTC BB:AGTI) announced that the effective date of its Chapter 11 reorganization plan has been changed to Aug. 5, 1999. The company previously anticipated an effective date of July 29, 1999. The company completed its reorganization effort on June 29, 1999, when the Bankruptcy Court in the District of Las Vegas confirmed the plan. The details of the plan were communicated in a release dated June 30, 1999. The plan authorizes the company to issue 25 million shares of new common stock. Unsecured creditors holding allowed claims will be issued 1.88 shares of new common stock for each $ 1 of allowed claim. Based on current estimates, the company expects shareholders of record on Aug. 5, 1999, to receive 1 share of new common stock for each 66 shares currently owned. AMNEX INC: Business Segment Being "Shut Down" -------------------------------------------- AMNEX, Inc. and its consolidated subsidiaries, is organized into three business units: AMNEX Integrated Services is a sales and marketing group which targets various markets in the operator services industry to provide operator and related services in the U.S.; AMNEX Public Communications is an asset management group focused on payphone ownership in the northeastern corridor of the U.S.; AMNEX International is a sales and marketing group dedicated to operator services opportunities between the Caribbean and Latin America, and the U.S. The International group develops business by exporting AMNEX's know-how to developing markets with strong U.S. affinity. The company is a New York corporation that was organized in 1985. Since 1996 the company has been acquiring payphone routes throughout the northeastern corridor of the U.S. and Florida, bringing its total payphone ownership to 11,138 payphones at December 31, 1998. AMNEX's wholly-owned subsidiary, Crescent Public Communications Inc. completed a number of payphone acquisitions in 1998, including the acquisition of 740 payphones in New York in February 1998; of 2,300 payphones primarily located in New Jersey, New York and Pennsylvania in July 1998; and of 230 payphones in New York in October 1998. AMNEX's 80%-owned subsidiary, Sun Tel North America, Inc. acquired 28 payphones in Florida in February 1999. Amnex Inc. filed on May 5, 1999 its petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York. Also on May 5, American Network Exchange, Inc., the operating subsidiary of the majority of the company's domestic Integrated Services Group activities, filed its petition for reorganization under Chapter 11 of the Bankruptcy Code. The Company and American Network Exchange, Inc. have been operating as debtors-in-possession since that date. The company's revenues totaled $76,842,000 for the year ended December 31, 1998 compared to $116,498,000 for 1997, a decrease of approximately 34%. Net losses sustained at year-end 1999 were $44,664 as opposed to net losses of $13,310 at years end 1998. A shortfall in funding has resulted in American Network Exchange Inc. having limited liquidity to meet post-petition obligations. In addition, American Network Exchange Inc. was unable to negotiate a new agreement with MCI Worldcom, the primary long distance network provider to ANEI. The U.S. Bankruptcy Court permitted MCI Worldcom to terminate service to ANEI and, as a result, on June 9, 1999, ANEI ceased operations, as did certain other of the Amnex' subsidiaries (other than Crescent and Sun Tel) whose operations were unprofitable or dependent upon ANEI. Amnex has decided to proceed with an orderly shut down under Chapter 11 for ANEI, as well as for the other entities which constitute its Integrated Network Services business segment. The company expects this process to be completed in the third quarter of 1999. BOSTON CHICKEN: Wins Nod For Plan Sponsor Procedures ---------------------------------------------------- The U.S. Bankruptcy Court in Phoenix has approved procedures designed to lure an investor to sponsor Boston Chicken Inc.'s reorganization plan. The July 23 order states that the fast-food chicken chain and debtor-in-possession lenders GE Capital Corp. and Bank of America NT & SA are to select a lead proposal for investment by July 30. If a lead proposal is chosen by that date, the company must file a disclosure statement and reorganization plan based on the plan sponsor's offer. After a lead bid is chosen, the company is still entitled to solicit and negotiate competing bids from other parties. Competing bids must be submitted by Aug. 27 on terms that have no conditions to closing other than a materially adverse change in the company's financial condition. (The Daily Bankruptcy Review and ABI Copyright c July 28, 1999) BRAZOS SPORTSWEAR: Seeks Extension of Exclusivity ------------------------------------------------- Brazos Sportswear, Inc., et al. petition the court for an extension of exclusive periods during which the debtors may file plans of liquidation and solicit acceptances of such plans. A hearing is set for July 30, 1999. The debtors request entry of an order extending the plan proposal period and the solicitation period for an additional 60 days (through and including September 29, 1999 and November 29, 1999, respectively) without prejudice to the debtors' right to seek further extensions of the exclusive periods. The debtor submits that its cases are large and complex; they have made good faith progress toward formulating a plan; the debtors are nearing the end of the process of liquidating substantially all of their assets and the aggregate amounts realized will have a significant effect on their plan; and the extension is not being sought to pressure creditors to accede to any demands by the debtors. BRAZOS SPORTSWEAR: Seeks To Reject Executory Contracts and Leases ----------------------------------------------------------------- Brazos Sportswear, Inc., et al., seek authority to reject executory contracts and unexpired leases. The debtors represent that it is critical that they be permitted to reject the contracts and leases as they no longer benefit the debtors. There are four leases, two of which cover premises that the debtor has vacated, and two of which cover premises that the debtor is about to vacate. The contracts are Premier Contracts for the business unit's leased telephone system and long-term long distance telephone plan. Premier has ceased operations and the debtors no longer require the equipment and services provided to Premier under the Premier Contracts. CORDEX PETROLEUMS: Meeting of Creditors --------------------------------------- A bankruptcy case concerning Cordex Petroleums, Inc. was originally filed under Chapter 11 on March 5, 1999 and was converted to a case under Chapter 7 on July 16, 1999. A meeting of creditors is set for August 18, 1999 at 3:30 PM, US Custom House, 721 19th Street Rm. 125, Denver, Colorado 80202-2508. CRIIMI MAE: August 5 Hearing Scheduled -------------------------------------- Bankruptcy Judge Duncan Keir (D. Md.) has granted CRIIMI MAE Inc. (http://www.criimimae.com),Rockville, Md., a bridge order continuing through Aug. 5 the company's exclusivity period to file a reorganization plan; on Aug. 5, the court will hold a hearing on CRIIMI MAE's motion to further extend the exclusivity period to file its plan to Oct. 4, according to a newswire report. The company is also requesting that it have until Dec. 3 to exclusively solicit acceptances of its reorganization plan. CRIIMI MAE and two affiliates filed chapter 11 on Oct. 5, 1998. (ABI 28-July-99) DISCOVERY ZONE: CEC Completes Acquisition of Assets -------------------------------------------------------------- CEC Entertainment, Inc. (NYSE: CEC) announced on July 28, 1999 that it completed the previously announced acquisition of certain assets of Discovery Zone, Inc., a nationwide operator of children's indoor entertainment centers, for approximately $19 million. Discovery Zone and certain affiliated entities filed for Chapter 11 bankruptcy protection on April 20, 1999. The assets acquired by CEC include 13 owned properties previously operated as Discovery Zone Fun Centers, two parcels of undeveloped real estate, the rights to seven leased properties previously operated as Discovery Zone Fun Centers and all furniture, fixtures, equipment and intellectual properties and trade names owned by Discovery Zone. Michael H. Magusiak, President, stated that, "We anticipate that this acquisition will result in a long-term excellent return on investment. We intend to convert approximately 10 of the acquired properties to Chuck E. Cheese's restaurants and sell the remaining land, buildings and equipment. We are excited about the quality of the real estate acquired in the transaction and the excellent strategic and development opportunities it provides the company." The Company operates a system of 333 Chuck E. Cheese's restaurants in 44 states, of which 278 are owned and operated by the Company. GENESIS PHYSICIANS: To File For Bankruptcy ------------------------------------------ A physicians' group that last year pulled out of Aetna's local network says it will file for bankruptcy. The doctors in Genesis Physicians Practice Association serve about 30,000 patients through contracts with several Dallas health maintenance organizations. The same doctors see patients in preferred-provider organizations through a sister company that is not a party to the bankruptcy. A spokesman for the group said Tuesday that liabilities exceed assets by up to $ 7 million. Genesis and other local physician groups say they have been squeezed by financial losses plaguing most HMO's in North Texas. To cut the losses, HMO's turned to cost-cutting, often from the budgets of hospitals and doctors. The HMO sector lost almost $ 130 million last year and $ 24 million in the first quarter of this year. One physician group representing 11 heart surgeons said it is owed about $150,000. Fifteen gastroenterologists say they will lost $ 120,000. Several individual doctors peg their losses in the thousands. The group's HMO contracts represent between 3 percent and 15 percent of each doctor's practice. Genesis said it is working wiuth insurance companies to try to ensure that consumers won't lose their doctors. Dr. Ralph Turner, chairman, said the deciding factor in filing for bankruptcy was the group's problems in processing claims. Slow bill processing made it impossible for Genesis to gauge the use of medical services and then try to manage it, Turner said. By filing for protection under Chapter 11 of the U.S. Bankruptcy Code, Genesis can continue operating normally while it completes a reorganization plan. Genesis withdrew from Aetna's network last fall, forcing about 26,000 North Texas residents to find new doctors or pay more out of pocket to see their existing ones. GEOGRAPHICS: Year-End Figures Show Operating Loss, Net Income ------------------------------------------------------------- Geographic Inc. manufacturers specialty papers which are paper on which photographs or other art images are printed and which are then cut to size. In 1992, the company introduced its first specialty paper product under the Geopaper brand name. The company now has several specialty paper products made using Geopaper designs, including stationery, business cards, brochures, memo pads, posters and paper cubes. These specialty paper products are designed to be used with personal computer printers. Geographic's international sales accounted for approximately 36%, 29%, and 35% of the company's total net sales in fiscal 1999, 1998 and 1997, respectively. These sales were concentrated in Canada, Europe and Australia. Net sales increased 42.4% to $19,976,290 in fiscal 1998 from $14,028,746 in fiscal 1997. This increase, the company says, was primarily attributable to the continued growth of the Geopaper product line. Geopaper sales increases in 1998 were due primarily to sales for new store openings by Office Depot, and initial shipments of Geopaper products to new customers, including Wal-Mart, Target and Kmart. In addition, Geopaper sales increased due to the introduction of the Geoposterboard product line in over 900 Wal-Mart stores, 500 Office Depot stores in the United States and Canada, and 80 Staples/Business Depot stores in Canada. Net sales in fiscal 1999 (ended March 31, 1999) was slightly less than fiscal 1998 with total net revenues in 1999 of $19,237,062. The company incurred a loss from operations in fiscal 1999 of $1,780,581 compared to an operating loss of $8,011,719 during fiscal 1998. The improvement was the result of significantly higher gross margins. Net income of $1,440,474 in fiscal 1999, or 7.5% of net sales, compares to a net loss of $8,649,618 in fiscal 1998, or (43.3)% of sales. HARNISCHFEGER: Investing in the Wrong Company --------------------------------------------- The Milwaukee Journal Sentinel reports on July 27, 1999 That when the Bass brothers started buying into Harnischfeger Industries Inc. last year, investors geared up for what they thought would be an exciting and profitable roller-coaster ride. And why not? The heirs to a multibillion-dollar Texas oil fortune are known for having the Midas touch with undervalued stocks. But sometimes even the Basses pick a dog. Or, in the case of Harnischfeger, the whole pound. One of the investment funds controlled by at least three Bass boys is sitting on a paper loss of nearly $90 million on its Harnischfeger stock, Securities and Exchange Commission records show. Analysts expect most of that loss will eventually be realized. Just 15 months ago, the Trinity I Fund paid up to $30 a share for stock in the 115-year-old company. Last month, after filing for Chapter 11 bankruptcy protection, Harney stock fell to $1. "The bottom line is, this was a horrendous situation that never should have occurred," said analyst Tobias Levkovich of Salomon Smith Barney. And, as it turns out, Harnischfeger is one of two Trinity I stock picks that filed for bankruptcy last month. The fund also had a large stake in Loewen Group Inc., a giant funeral home operator. Trinity I spent $69.5 million to buy 2.39 million shares at an average price of $28.98. The mere disclosure of that initial buying spree helped boost the price of Harney's shares as investors figured the Bass brothers -- siblings with a net worth estimated at about $6.5 billion -- must have seen something others missed. The Bass brothers kept buying, eventually spending more than $96 million, or an average of $25.27 a share, for an 8% stake in the company. Meanwhile, Harney lost $90 million during the first half of this fiscal year. Buying as the stock price was falling is typical of the Bass brothers and Thomas Taylor, the longtime manager of Trinity I, Jung said. So when the Bass fund recently unloaded 629,200 shares, it was only able to recoup $2.44 million -- an average of $3.87 per share. Buyers paid as little as $1.13 each for some of those shares. SEC records show that Trinity I still owns about 3.2 million shares worth about $6.4 million. Analysts hold out little hope for the investment making a comeback. Yet, for some reason, Harnischfeger stock has been subject to active trading and has been holding steady at around $2. IFUSION: Order Confirms Plan of Liquidation ------------------------------------------- On June 15, 1999, the Honorable Prudence Carter Beatty, JS Bankruptcy Judge for the Southern District of New York, entered an order confirming the first amended plan of liquidation of IFusion Com Corporation. IMAGYN MEDICAL: Court Approves Committee Counsel ------------------------------------------------ By order of the US Bankruptcy Court for the District of Delaware, the Committee of Unsecured Creditors of Imagyn Medical Technologies, Inc., et al. is authorized to retain Anderson Kill & Olick PC, nunc pro tunc from June 23, 1999. By separate order the court authorized the committee to retain the firm of Walsh, Monzack and Monaco, PA as the Committee's co-counsel. JUICY LUCY'S: Files For Bankruptcy Protection --------------------------------------------- Juicy Lucy's drive-thru hamburger chain, a wholly owned subsidiary of Franchise Management International, Inc. (OTC Bulletin Board: FMII), announced today that it has decided to seek protection from its creditors by filing a Chapter 11 bankruptcy petition in Federal Court in Tampa, Florida. According to the Company, its reorganization plan has already been developed, and the Company believes that by operating under the protection of the bankruptcy court, Juicy Lucy's, Inc. will be able to successfully reorganize its affairs and emerge as a viable and profitable company. As part of the restructure, Henry Orlinsky and Tom Bumgardner are no longer members of the Board of Directors of FMI, and E. Wayne Wallhausen and Mark Novell have left the company. The Company is actively seeking a new CFO. The operations of FMI exclusive of Juicy Lucy's, Inc. are not affected by the filing. Franchise Management International, Inc. was founded in 1997 for acquiring, managing, and franchising quick service restaurants. FMI stock is currently trading on the OTC Bulletin Board. NATIONAL CATTLE: To Turn Dog Track Into Stock Car Track ------------------------------------------------------- The National Cattle Congress' has cleared another hurdle in its plans to turn a defunct dog track into a car racing venue. The Waterloo Board of Adjustment on Tuesday approved a special permit allowing the plan at the NCC's Waterloo Greyhound Park, despite objections from homeowners near the track. Later this year, the City Council will consider a site plan for the venture. The NCC board of directors wants to build a 3/8-mile stock track and begin racing next summer. "Stock car racing right now is the fastest growing sport in America," said NCC general manager Judy McVey. "We do want to be a good neighbor, but at the same time we would like the opportunity to bring some economic growth to the entire Cedar Valley area." Residents of the mostly upscale homes have said they were concerned about noise from the stock cars and a potential drop in their property values due to the track's proximity. Bob Greenwood, who lives near the track, brought his $ 366,000 property assessment notice and his $ 8,000 annual property tax bill to the meeting to show board members what he had to risk. "This is our home," Greenwood said. "We don't want a stock car track disturbing the peaceful quiet of our neighborhood." But racing fans have also submitted a petition in favor of the track signed by 3,500 people. The Cattle Congress has filed for Chapter 11 bankruptcy protection twice in the past five years. The group used to run a yearly fair in Waterloo and opened the greyhound park in 1993. Live racing stopped at the park the following year. NATIONSWAY: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Nationsway Transport Service, Inc. 5620 West Lower Buckeye Road Phoenix, Arizona 85043-7914 Court: District of Arizona (Phoenix) Case No.: 99-05861-SSC Filed: 05/20/99 Chapter: 11 Debtor's Counsel: Donald L. Gaffney Snell & Wilmer LLP One Arizona Center, 400 East Van Buren Phoenix, Arizona 85004 Total Assets: $77,783,528 Total Liabilities: $102,772,176 20 Largest Unsecured Creditors: Name Amount ---- ------ Liberty Mutual Insurance Company undetermined Central States Pension Fund $2,313,373 Mercedes-Benz Credit Corp $1,416,927 Transwest Trailers $403,344 Transwest Freightliner $768,527 IDM $1,176,838 AT&T $434,592 National Fire Insurance Company of Hartford $3,740,000 Western Conference of Teamsters $6,431,992 United Road Service $119,752 Tire Distribution Systems $123,819 Shipley Oil $149,655 Local Union #710 Pension Fund $188,411 Union Pacific RR $768,963 Burlington Northern Santa Fe $339,273 Consolidated Rail Corp $166,222 Local Union 229 $116,658 Chicago Truck Drivers Union $109,498 Local Union 961 $240,633 Local Union 17 $140,417 NATIONSWAY: Committee Objects To Employee Retention Plan -------------------------------------------------------- The Official Committee of Unsecured Creditors objects to the proposed employee retention plan. The Committee asserts that the motion and retention plan call for 50% wage bonuses to be paid to various employees and management of the debtor as well as $750, $1500 or $3000 bonuses to be paid to employees if they stay for certain time periods, and $5000 bonuses for management if they stay until the liquidation is complete. The Committee believes that fewer employees could have been retained, and that there is no need to be concerned with stability or morale in this liquidation. The Committee believes that these bonuses are unfair in light of the fact that employees were not paid for their work prior to termination. The Committee particularly objects to bonuses for senior management. While the retention plan provides that a total of $\100,000 be set aside, the Committee believes that the payments will total a much greater sum, possibly hundreds of thousands. The Committee objects to the payment of premiums and related amounts associated with D&O insurance in place prior to the Petition Date. The Committee also objects to the use of cash collateral to fund the plan, and the committee asserts that the retention plan provides no benefit to the estate. NEXTWAVE: Federal Judge Rejects FCC Claim ----------------------------------------- Communications Daily (Copyright 1999 Warren Publishing, Inc.) Reports on July 29, 1999, that U.S. Dist. Court in White Plains, N.Y., dismissed FCC claims, finding that the bankruptcy judge shouldn't have made a 75% cut in value of NextWave's PCS licenses. Judge Charles Brieant said late Tues. that U.S. Bankruptcy Court, also in Southern Dist. of N.Y., properly decided that NextWave, biggest C-block bidder that now is in bankruptcy reorganization, could use "avoidance remedy" to reduce its obligation to $1.02 billion from $4.74 billion it committed to in high bids on 63 licenses. FCC said high-bid total should have been used to value obligation. Brieant acted on FCC's appeal of series of decisions by Bankruptcy Court Judge Adlai Hardin earlier this year. NextWave sought Chapter 11 bankruptcy protection in June last year. FCC Gen. Counsel Christopher Wright said agency is reviewing decision and hasn't determined "appropriate course of action to take." NextWave had challenged Commission's right to recover "fraudulently incurred obligation," referring to bid price that NextWave offered in 1996 auction. NextWave argued that bid price was inflated, and thus "fraudulently incurred," and said that fact became evident when much lower prices were offered in later D-, E- , and F-block auction. Lower valuation sought by NextWave and approved by bankruptcy judge was based on bid prices in follow-up auction. Brieant also rejected FCC argument that Bankruptcy Court and U.S. Dist. Court don't have jurisdiction to review FCC actions. FCC said only U.S. Appeals Courts can review its regulatory actions. Bankruptcy Court said this is different because FCC is acting as creditor not regulator and Brieant agreed, saying: "The regulations outlining the steps to be taken by the FCC in the event of a default in payment of the installment notes are provisions of a contract between creditor and debtor. As such, they are subject to revision and adjustment pursuant to the Bankruptcy Code... Congress could have exempted but did not exempt the FCC from the Bankruptcy Code." Brieant also rejected FCC claim that Bankruptcy Court failed to weigh damage that results if courts allow spectrum licensees "to avoid critical provisions of their regulatory agreement with the FCC by declaring bankruptcy." He said allowing NextWave to keep its licenses "promotes rapid deployment of technology without the delay of re-auction and development of a new network by another company." He pointed out that Congress made clear that "maximizing revenue" shouldn't be FCC's objective. Based on lower value of spectrum in later PCS auctions, "the FCC is recovering more than the value of the spectrum and should not now be trying to maximize revenue by trying to recover the winning bid," he said. Brieant disputed FCC's contention that NextWave decision would undermine auction process by encouraging companies to bid high and then seek bankruptcy protection. "Bankruptcy is bad business," judge said. C-block auction was "disaster" for all bidders, he said, with winning bidders either in bankruptcy or paying "outrageously inflated prices" for spectrum. "Those who bid but did not win are lucky, not hurt," Brieant said. NextWave already has made down payment of $474 million so its final obligation is $548.8 million, judge said. PHILIP SERVICES: Hearing on Disclosure Statement ------------------------------------------------ A hearing to consider the approval of the Disclosure Statement of Philip Services (Delaware) Inc., et al. will be held at 9:30 AM before Judge Mary F. Walrath, US Bankruptcy Court, Marine Midland Plaza, 824 Market Street, Sixth Floor, Wilmington, Delaware. PITTSBURGH PENGUINS: Lemieux Secures Investments for Penguins ------------------------------------------------------------- According to his attorney, former Pittsburgh Penguin star Mario Lemieux has raised enough money from investors to complete his purchase of the hockey team, but it will be a week before the paper work is completed and the deal closed, The Pittsburgh Post-Gazette reported. Lemieux has collected more than $50 million, his attorney said, which is the minimum outside investment required in his reorganization plan for the team, which filed for bankruptcy last year. It is not clear whether he has reached his goal of $55 million, which is the amount he pledged in a tentative agreement with the Public Auditorium Authority. Yesterday Bankruptcy Judge Bernard Markovitz denied a request from SMG, the Civic Arena landlord, to hold up Lemieux's takeover of the team until final details can be addressed on SMG's agreement to lease the Civic Arena until 2004 and managed it until 2012. (ABI 28-July-99) PRESTON TRUCKING: Maryland Trucking Company to Shut Down -------------------------------------------------------- Preston Trucking Co., a 67-year-old privately owned freight carrier based in Preston, Md., announced that the company will shut down operations because its lenders will not make additional advances that would enable the company to continue operations, The Washington Post reported. CFO Sean Callaghan said that attempts to obtain financing from other sources have been unsuccessful and that it does not have enough money to pay its bills. Preston's lenders' announcement came on July 24. Some 5,000 employees will be out of work as a result of the company's shutdown. Preston reported about $450 million in sales last year, but competition in its northeastern and midwestern markets has increasingly been a problem. American Trucking Association economist Bob Costello said that Preston also is in a slow-growth niche of the industry, called "less than truckload." In this niche, truckers have higher costs structures because they pick up smaller loads from several customers, haul the freight to a warehouse, consolidate the freight and then reload it on trucks to transport to other cities. Companies that carry freight non-stop to their destination have lower costs. SERVICE MERCHANDISE: Month End Financials Shows Gains & Losses ----------------------------------------------------------------- In its monthly financial report for the month ending May 30, 1999, Service Merchandise Co. Inc., operating as Debtor-in- Possession, together with its subsidiaries showed consolidated net revenues of $157,206 with net loss of $15,060. The consolidated statement of operations reflects results of continuing stores and 121 stores closed by May 1999. The company recorded net earnings of $5,320 on net sales of $154,592 from continuing operations. STARTER CORP: To Reject Agreements With Madison Square Garden ------------------------------------------------------------- In about November, 1997, Starter and Madison Square Garden, LP (MSG) entered into two integrated Agreements that provided for Starter to act as the exclusive supplier of sports and non-sports apparel and headwear licenses by certain sports leagues, advertise and promote it s products at MSG, and use MSG trademarks on its products. MSG agreed to exclusively purchase Starter merchandise t stock its on-premises stores, and rename its stores, incorporating the Starter name and trademark. Since the debtor has sold its inventory and trademarks to a third party, the debtors can no longer perform under the agreements. USA BRIDGE: Hearing to Consider Approval of Disclosure Statement ---------------------------------------------------------------- On August 31, 1999 at 10:00 AM a hearing will be held before the Honorable Dorothy Eisenberg, US Bankruptcy Court, Eastern District of New York to consider the adequacy of the information contained in the Disclosure Statement filed by the debtor, USA Bridge Construction of New York, Inc. WESTERN FIDELITY: Trustee To Retain Rosania ------------------------------------------- The US Bankruptcy Court for the District of Colorado entered an order on July 19, 1999 granting the Trustee's motion to employ Joseph G. Rosania, as general litigation counsel. ********** 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 in each Friday edition of the TCR, is provided 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, Yvonne L. Metzler and Lexy Mueller, Editors. Copyright 1999. All rights reserved. ISSN 1520-9474. 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. 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