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TWEETER HOME: Discloses Two Stalking Horse Bids for Assets

Troubled Company Reporter, June 27, 2007 


Tweeter Home Entertainment Group, Inc., disclosed yesterday two "stalking horse" bids for its assets in connection with the company's Chapter 11 reorganization efforts.

Schultze Asset Management, LLC has made a $38 million "going concern" bid for substantially all of the Company's assets.  Schultze would also assume $8 million of Tweeter's "cure costs" associated with the company's bankruptcy proceeding, as well as provide the national specialty consumer electronics retailer with a $10 million junior debtor-in-possession line of credit.  Tweeter intends to use the $10 million in new funding to purchase merchandise and for other general corporate purposes.

Schultze's bid includes the purchase of Tweeter's 18.75% interest in Tivoli Audio, LLC

Separately, Whippoorwill Associates, Inc. and Bay Harbour Management, L.C. have teamed up to make a $10 million bid for just Tweeter's Tivoli ownership interest.

The U.S. Bankruptcy Court for the District of Delaware yesterday approved Schultze's, Whippoorwill's and Bay Harbour's respective "stalking horse" bids under a process where other qualified bidders will have the opportunity to submit "higher or otherwise better" offers.

An auction will commence on July 10, 2007 among Schultze, Whippoorwill, Bay Harbour and any other qualified bidder.

"We are pleased to complete these important steps in our restructuring process as we move forward," said Tweeter President and CEO Joe McGuire.  "Our objective is to bring cash into the Company as quickly and responsibly as possible and today's events move us closer to that goal."

                  About Schultze Asset Management

Founded in 1998, Schultze Asset Management, LLC -- http://www.samco.net/ -- is a leading alternative investments firm   specializing in distressed and special situations investing.  The firm manages approximately $725 million in assets on behalf of institutional and high net worth clients located throughout the world. Schultze's offices are in Purchase, NY.

About Whippoorwill Associates and Bay Harbour

Whippoorwill Associates, Inc. and Bay Harbour Management L.C. are investment managers specializing in distressed securities and special situations.

About Tweeter Home

Based in Canton, Mass., Tweeter Home Entertainment Group Inc. -- http://www.tweeter.com/ -- retails mid-to high-end audio and 
video consumer electronics products.  Tweeter and seven of its affiliates filed for chapter 11 Protection on June 11, 2007 (Bankr. D. Del. Case No: 07-10787 through 07-10796).  Gregg M. Galardi, Esq. and Mark L. Desgrosseilliers, Esq. at Skadden, Arps, Slate, Meagher & Flom, L.L.P. represent the Debtors in their restructuring efforts.  As of Dec. 21, 2006, Tweeter had total assets of $258,573,353 and total debts of
$190,417,285.  The Debtors' exclusive period to file a plan expires on Oct. 9, 2007.

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