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/raid1/www/Hosts/bankrupt/TCR_Public/000214.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 14, 2000, Vol. 4, No. 31 Headlines AMERICLEAN INC: Case Summary & 20 Largest Unsecured Creditors ASSOCIATED AIRLINE: Case Summary CAROL PUBLISHING: Meeting of Creditors CASMYN CORP: Court Approves Distribution of Disclosure Statement COMMERCIAL FINANCIAL: Order Authorizes Special Accountants CONVENIENCE MORTGAGE: Last Date For Filing Proofs of Claim FIRST CENTRAL FINANCIAL: Seeks To Fix Bar Date HOMEMAKER INDUSTRIES: Seeks Extension of Exclusivity HOSPITAL STAFFING SERVICES: Order Approves Trustee's Attorney HOUSING RETAILER: Order Denies Extension of Exclusivity JITNEY JUNGLE: Interim Exclusivity Extension LOIS/USA: Seeks Extension of Exclusivity N.U. PIZZA: Files Chapter 11 NEUROMEDICAL SYSTEMS: Confirmation of Plan NEXTWAVE: Appeals Court Rules in Favor of FCC PLUMA INC: Seeks Designation of Borders as Liquidation Officer RELIANT BUILDING PRODUCTS INC.: Moody's Downgrades Debt Ratings SERVICE MERCHANDISE: Partners With Three Vendors SHARPE: Files Final Proposed Reorganization Plan SIRENA APPAREL: Court Approves Employment Agreements SUPERIOR NATIONAL INSURANCE: Moody's Downgrades Ratings UNIVERSAL SEISMIC: Hearing on Disclosure Statement VENCOR INC: Order Authorizes Employment of The Blackstone Group WORLDCORP: Hearing on Approval of Disclosure Statement WSR CORP: Seeks To Extend Exclusivity ********* AMERICLEAN INC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Americlean Inc. PO Box 349 Silver Springs Nevada 89429-0349 Petition Date: January 24, 2000 Chapter 11 Court: District of Nevada Judge: Gregg W. Zive Debtor's Counsel: Stephen R. Harris Belding, Harris & Petroni, Ltd. 417 West Plumb Lane Reno Nevada, 89509 (775) 786-7600 Total Assets: above 1 million(estimated) Total Debts: $500 thou to 1 million(estimated) 20 Largest Unsecured Creditors Evergreen Oil, Inc. Goods/Services $ 59,542 Erickson, Inc. Goods/Services $ 43,924 Berry Hinckley Goods/Services $ 33,443 US Filter/Envirogroup Goods/Services $ 22,412 Carson Valley Oil Goods/Services $ 15,045 Ecology Control Industries Goods/Services $ 17,122 Liquid Transfer, LLC Goods/Services $ 13,340 UNR Fire Science Academy Goods/Services $ 12,419 Union Tank Car Co. Goods/Services $ 11,021 Petroleum Tank Lines Goods/Services $ 10,032 SECOR Goods/Services $ 10,509 Joey's Tire Services Goods/Services $ 9,536 Burns Truck & Trailer Services Goods/Services $ 9,193 Dry Creek Quality Indus Svcs Goods/Services $ 8,910 A&B Truck Repair, Inc. Goods/Services $ 8,149 William Tank Lines,Inc. Goods/Services $ 6,780 Bonander Truck Goods/Services $ 6,556 Nevada Thermal Svcs,LLC Goods/Services $ 5,749 DL White Trucking Goods/Services $ 5,327 Riviera Finance Goods/Services $ 5,108 ASSOCIATED AIRLINE: Case Summary -------------------------------- Debtor: Associated Airline Services 4608 Paradise Road Las Vegas, Nevada 89109 Petition Date: January 28, 2000 Chapter 11 Court: District of Nevada Judge: Robert C. Jones Debtor's Counsel: Matthew L. Johnson Hutchison & Steffen, Ltd. 8831 W. Sahara Avenue Las Vegas, Nevada 89117 (702)385-2500 Total Assets: $ 1,971,799 Total Debts: $ 1,575,743 CAROL PUBLISHING: Meeting of Creditors -------------------------------------- The debtor, Carol Publishing Group, Inc. filed a case under Chapter 11 of the Bankruptcy Code on November 12, 1999. A meeting of creditors is set for March 1, 2000 at 2:00 PM at the Office of the US Trustee, One Newark Center, 21st Floor, Suite 2106, corner of McCarter Hwy & Raymond Blvd., Newark, NJ 07102- 5504. The debtor's attorney is Ravin, Sarasohn, Cook, Baumgarten, Fisch, Roseland, NJ. The deadline to file a proof of claim is set for May 30, 2000. CASMYN CORP: Court Approves Distribution of Disclosure Statement ----------------------------------------------------------------- Casmyn Corp. (OTC Bulletin Board: CMYN) announced that on February 3, 2000, the United States Bankruptcy Court, Central District of California, San Fernando Valley Division, approved the Second Amended Disclosure Statement Describing Debtor's Second Amended Plan of Reorganization and authorized the distribution of documents to both creditors and common and preferred shareholders for purposes of voting on the Debtor's Second Amended Plan of Reorganization. The official Unsecured Creditors Committee recommends the Plan and that other creditors and shareholders vote to accept the Plan. Ballots must be received by March 17, 2000 and the confirmation hearing for the Plan has been set for March 31, 2000. The Plan contemplates an equity recapitalization that will result in the conversion into common stock of substantially all of the Company's debt and all of the outstanding preferred stock. The Company's gold mining operations in Zimbabwe are owned by separate subsidiary companies which are not a part of the Chapter 11 filing and are continuing to conduct business as usual. Copies of the Plan, the Disclosure Statement and other solicitation materials are available at www.wsilaw.com. Creditors and shareholders may contact Richard Wynne, the company's bankruptcy counsel, in Los Angeles, California, at Wynne Spiegel Itkin, 310-551-1015, by fax at 310-551-3059, or by e-mail at www.wsilaw.com. COMMERCIAL FINANCIAL: Order Authorizes Special Accountants ---------------------------------------------------------- The US Bankruptcy Court for the Northern District of Oklahoma approved and CFS is authorized to employ PricewaterhouseCoopers LLC as its special accountants in the case to assist in the performance of the tasks specified in the letter attached as Exhibit A to the Application. The tasks include preparing tax returns, consulting regarding an IRS examination and preparing Form 5500's and providing general tax advice. CONVENIENCE MORTGAGE: Last Date For Filing Proofs of Claim ---------------------------------------------------------- On February 4, 2000, the US Bankruptcy Court for the Southern District of New York entered an order setting March 3, 2000 as as the last date upon which any party may file a proof of claim against Convenience Mortgage Corporation, a/k/a CMC. FIRST CENTRAL FINANCIAL: Seeks To Fix Bar Date ---------------------------------------------- Martin P. Ochs, the Chapter 7 trustee, of the bankruptcy estate of First Central Financial Corporation, the debtor, seeks to establish April 17, 2000, at 5:00 PM as the last date for the filing of proofs of claim by persons who hold or assert administrative claims against the debtor's estate. HOMEMAKER INDUSTRIES: Seeks Extension of Exclusivity ---------------------------------------------------- The debtor, Homemaker Industries, Inc. seeks to extend the debtor's exclusive right to file a plan of reorganization to April 27, 2000 and the debtor's right to solicit and obtain acceptances to June 26, 2000. The debtor requests that the expiration date be extended to the maturation date of the DIP Loan Agreement, or April 27, 2000 and that the 180 day expiration date be extended to June 26, 2000. The debtor believe s that it can effectuate a sale of its business operations, and that it can file a plan and disclosure statement shortly after court approval of such a sale. No bid has yet been submitted, therefore the debtor asks for the extension of exclusivity. HOSPITAL STAFFING SERVICES: Order Approves Trustee's Attorney ------------------------------------------------------------- By order of the US Bankruptcy Court for the Southern District of Florida, Broward Division, the trustee is authorized to employ Arthur Halsey Rice of the law firm of Rice & Robinson PA as attorney for the trustee, on a general retainer. HOUSING RETAILER: Order Denies Extension of Exclusivity ------------------------------------------------------- The US Bankruptcy Court for the District of Delaware entered an order denying the extension of exclusive periods during which the debtors may file plans of reorganization and solicit acceptances of such plans. JITNEY JUNGLE: Interim Exclusivity Extension -------------------------------------------- The court has extended the exclusive plan periods of Jitney- Jungle Stores of America Inc. (X.JIT) on an interim basis while it considers the supermarket operator's recent request to extend the periods for an additional 120 days. In a motion filed Feb. 2, the company asked the U.S. Bankruptcy Court in New Orleans to extend until June 12 its exclusive period for filing a plan and until Aug. 14, its exclusive period for soliciting votes to the plan. The periods are scheduled to expire 120 and 180 days after the company's Oct. 12 petition date, or Feb. 9 and April 9, respectively. In an order from Feb. 2, U.S. Bankruptcy Judge T.M. Brahney III temporarily extended the exclusive periods until resolution of the company's request. The court has scheduled a hearing on the matter for Feb. 25. (The Daily Bankruptcy Review and ABI February 11, 2000) LOIS/USA: Seeks Extension of Exclusivity ---------------------------------------- The debtors, Lois/USA, Inc., Lois/USA Chicago, Inc. and Lois/USA New York, Inc. seek an extension of the debtors' exclusive period for filing a Chapter 11 plan through and including May 31, 2000 and an extension of the debtor's exclusive period for obtaining acceptances of any such plan through July 31, 2000. The debtor has less than ten remaining employees who have spent the first 120 days of the cases selling the F&K Stock, setting up the use of cash collateral, winding down the Chicago office, preparing schedules and statements. The debtors, on a consolidated basis, have almost 2,000 creditors and they have filed an application to set a claims bar date. The debtors are now focusing on the debtors' accounts receivables, which total approximately $24 million. The debtors state that it is premature to file a plan at this point in time, and therefore seek the necessary extensions N.U. PIZZA: Files Chapter 11 ---------------------------- N.U. Pizza Holding Corp., Los Angeles, has filed for chapter 11 protection, and company officials anticipate the reorganization could take up to a year, according to a newswire report. The company will be doing a late filing for its second quarter 10Q, but limited resources have prevented the company from holding its annual shareholders meeting. (ABI February 11, 2000) NEUROMEDICAL SYSTEMS: Confirmation of Plan ----------------------------------------------------------------- By order dated Janaury 31, 2000, the US Bankruptcy Court for the District of Delaware confirmed the debtor's first amended plan of liquidation. NEXTWAVE: Appeals Court Rules in Favor of FCC --------------------------------------------- T Court of Appeals for the Second Circuit in New York set aside a Jan. 31 bankruptcy court ruling that had blocked the Federal Communications Commission (FCC) from cancelling NextWave Telecom Inc.'s wireless licenses, Reuters reported. Hawthorn, N.Y.-based NextWave won the 90 licenses at two 1996 government auctions, but unable to raise the money needed, it filed chapter 11 in 1998. A bankruptcy court ruled that NextWave could keep the licenses, but the appeals court overturned that decision in November, and in January, the FCC announced it would re-auction the rights. On Jan. 31, the bankruptcy court moved to block the FCC from doing so. In its ruling yesterday, the appeals court said it would hear further arguments in the coming weeks, but the two-page order did not give any explanation for the reversal of the bankruptcy court's Jan. 31 order. When the appeals court ruled in November, it said that the FCC, not the bankruptcy courts, had jurisdiction over the terms of and conditions of the licenses. The FCC has announced that it wants to re-auction the licenses retrieved from bankrupt or troubled carriers on July. NextWave officials said they were disappointed in the latest ruling but also claimed victory saying that the ruling "will accelerate consideration of some important issues in that proceeding." FCC Chairman Bill Kennard, who testified before a Senate Budget Committee hearing yesterday, said that taxpayers could lose billions of dollars, and the promise of new communications services, if the licenses continue to be tied up in bankruptcy court, the Associated Press reported. "Spectrum belongs to the American public. It's a national resource," he said. Kennard said that allowing bankrupt companies to hold onto the licenses, and eventually pay only a portion of what they bid, undermines the process. Kennard advocated for legislation that would ensure that the government gets back licenses from companies that file for bankruptcy protection. Sen. Judd Gregg (R-N.H.) and others have pushed for such legislation in the past. Gregg said that NextWave is "trying to beat down the taxpayers by going into bankruptcy court." NextWave rejects the argument that it filed in order to reduce what it owed to the government; instead, it blames the FCC license policy for its financial problems. NextWave COO Raymond Dolan also chastised the FCC for not accepting the company's offer to pay for the licenses so that they can be put to use for consumers. (ABI February 11, 2000) PLUMA INC: Seeks Designation of Borders as Liquidation Officer -------------------------------------------------------------- Pluma, Inc., moves the court for entry of an order designating Andrew Martin Borders as the debtor's Chief Liquidation Officer, with full power and authority to transact business on behalf of the debtor, consistent with the provisions of the bankruptcy Code and the debtor's confirmed plan of liquidation. RELIANT BUILDING PRODUCTS INC.: Moody's Downgrades Debt Ratings ----------------------------------------------------------------- Moody's Investors Service downgrades Reliant Building Products Inc.'s ("Reliant") bank credit facility to Caa2 from B2, its rating on its 10.875% subordinated notes due 2004, to Ca from Caa1, its issuer rating from B3 to Caa3. The senior implied rating is downgraded to Caa1 from B2 and the outlook remains negative. The downgrade is prompted by the financial restructuring Reliant announced in November 1999 in which holders of the company's outstanding 10.875% senior subordinated notes due 2004 will exchange for new notes that will provide the company with the flexibility, at its option over the next approximately three years, to pay interest in cash or to defer the payment of interest until the final maturity of the notes. Interest on the senior subordinated notes due November 1, 1999 was not paid. Reliant has accumulated substantial leverage relative to its cash generation levels, due mainly in part to its aggressive acquisition strategy. Although the company has cut costs each quarter of the past financial year, Reliant has been unable to generate sufficient cash levels which would allow it to reduce debt and strengthen liquidity. As of October 28, 1999, Reliant had $2.2 million available under its revolver. On October 1, 1999, the company and its lenders executed a Second Amendment and Waiver, in which the lenders waived, for a limited period of time, certain financial covenants under the Senior Credit Facility. The agreement also provides for an amendment of the financial covenants and an $8 million increase in the revolver borrowing base, which would be made available incrementally. The agreement requires the company to make an exchange offer for the existing notes along with a $10 million investment in the company by existing equity owners of the company's parent, RBPI Holdings Corp., in the form of equity or subordinated debt. The new notes will provide the company with the option to accrue interest payments until maturity for a period of 3 years, beginning on November 1, 1999. Reliant's EBITDA/Interest ratio was approximately 0.6x during its seasonally stronger fiscal 2000 1st and 2nd quarters. For its quarter ended October 1, 1999, EBITDA/ Interest coverage was 0.2x and (EBITDA-Capex)/Interest coverage was <0.35> times, reflecting the company's limited ability to service debt and fund maintenance capital expenditure needs. DEBT/EBITDA was extremely high at 15.6x. Sales have decreased 12.2%, from $77.5 million in the quarter ended October 2, 1998 to $68.0 million for the quarter ended October 1, 1999. $5.5 million of the decrease in sales can be attributed to the sale of the commercial window and specialty glass operations on July 1, 1999. Margins have declined, while at the same time SG&A expenses have increased. During its second quarter, the company also recorded an impairment charge of $4.8 million to adjust the carrying value of long-lived assets to their fair value. Additional impairment charges may be necessary, especially in the case of a downturn in the market. The company's sales have declined during a period in which the homebuilding market has shown record growth. Given the company's current liquidity restraints, a downturn in the market could be extremely detrimental. Reliant Building Products, based in Dallas, is one of the largest manufacturers of residential aluminum and vinyl-framed windows in the United States. SERVICE MERCHANDISE: Partners With Three Vendors ------------------------------------------------ Taking a bold step toward building its e-commerce business, Service Merchandise Co. has formed an Internet alliance with three housewares vendors: World Kitchen (formerly Corning Consumer Products Co.), Windmere's Consumer Products Group (formerly Household Products), and Panasonic Home and Commercial Products Co. As a result, by the second quarter of this year, the $ 3.2 billion retailer will offer consumers a complete product assortment from these vendors via its Web site, www.servicemerchandise.com. SHARPE: Files Final Proposed Reorganization Plan ------------------------------------------------ Sharpe Resources Corporation's (ME:SHO.)(OTCBB:SHGPF) wholly owned subsidiary Sharpe Energy Company (SEC) announced today that on February 9, 2000, the Company filed with the U.S. District Bankruptcy Court of the Southern District of Texas a final proposed plan of reorganization in accordance with federal bankruptcy laws. The plan of reorganization sets forth the means for satisfying claims, including liabilities subject to compromise and subsequent adjustments to the plan. In general the plan provides for the following: Secured bank debt of $2.4 million will be paid in full on the closing date. The agreed to secured vendor lien claims will accept a cash payment of $0.45 as full payment of their claims. Alternatively, one of the sub-classes of secured claimants will have the option to be paid in full over 6 years at 9 % interest. The first payment would commence 18 months after the closing date. The unsecured vendor claims will accept a $0.10 cash payment 120 days after closing. At that time the balance of the claim is to be converted to Sharpe Resources Corporation Preferred Class A stock which is subject to regulatory approval. The Preferred Class A stock will pay a quarterly stock dividend of 4 % per annum. Additionally, the Preferred Class A stock may be redeemed by the Company, all or in part, at a discount based upon the time of issuance, i.e., from 0-15 months the preferred can be redeemed for 35 % of the remaining value, from 16-24 months the redemption is 40 % of the remaining value, from 25-36 months the redemption is 60 % of the remaining value and thereafter at 100 % of the remaining value plus interest. Sharpe Resources Corporation has negotiated a US $2.3 million private placement financing. Schwartz Investments Corporation and Palos Capital Corporation of Montreal, Quebec have agreed to complete a US $2.3 million debenture financing subject to a due diligence evaluation, US Bankruptcy Court and regulatory approvals. The term of the debenture is five years and a 12 % fixed interest rate coupon with quarterly interest and principal payments which includes 2.3 million in warrants exercisable for three years at $C0.25 per warrant. The consummation of the final proposed plan of reorganization will require bankruptcy court approval and is expected to be voted on by the Company's creditors and shareholders entitled to vote. At this time, no assurances can be given that the plan of reorganization submitted by the Company will be approved or when the effective date of the plan will be set; however, at the present time, the Company anticipates that a hearing to consider its plan will be scheduled by mid-February, 2000. SIRENA APPAREL: Court Approves Employment Agreements ---------------------------------------------------- The US Bankruptcy Court for the Central District of California, Los Angeles Division, entered an order authorizing the debtor to enter into a post-petition employment agreement with Brian Zientek as CEO and to modify the terms of employment of Richard E. Matthews. SUPERIOR NATIONAL INSURANCE: Moody's Downgrades Ratings ------------------------------------------------------- Moody's Investors Service has downgraded the debt and financial strength ratings of Superior National Insurance Group, Inc. The senior bank facility rating was downgraded to Caa1 from B2. The ratings of trust preferred securities were moved to "ca" from "caa", and the insurance financial strength ratings of the company's insurance subsidiaries were moved to B1 from Ba3. The rating action reflects Moody's concern that in the absence of a revision to the company's bank loan agreement, Superior National could have difficulty meeting its obligations in 2000. The action also reflects Moody's ongoing concern for the adequacy of Superior National's reserves, as well as the company's reported shareholders' equity, which could be adversely impacted should the value of certain intangible assets be adjusted downward. The following ratings actions have been taken: Superior National Capital Trust I -- trust preferred securities to "ca" from "caa"; Superior National Insurance Group, Inc. -- senior subordinated debentures to Ca from Caa2; Superior National Insurance Group, Inc. -- guaranteed senior secured term loan facility to Caa1 from B2; Superior National Insurance Company -- insurance financial strength to B1 from Ba3; Superior Pacific Casualty Company -- insurance financial strength to B1 from Ba3; California Compensation Insurance Company -- insurance financial strength rating to B1 from Ba3; Commercial Compensation Insurance Company -- insurance financial strength rating to B1 from Ba3; Combined Benefits Insurance Company -- insurance financial strength rating to B1 from Ba3. Superior National Insurance Group, based in Calabasas, California, currently ranks as the second-largest writer of workers' compensation in the state of California, and the largest private sector workers' compensation writer in the state. At September 30, 1999 the company's shareholders' equity stood at $174 million and it reported a net loss of $30 million for the year-to-date. UNIVERSAL SEISMIC: Hearing on Disclosure Statement -------------------------------------------------- The hearing to consider approval of the disclosure statement of Univeral Seismic Associates Inc. will be held at US Bankruptcy Court, 515 Rusk Avenue, Houston, Texas, Courtroom #401, 4th Floor, March 7, 2000 at 9:30 AM. VENCOR INC: Order Authorizes Employment of The Blackstone Group --------------------------------------------------------------- By order entered on January 31, 2000, the debtors, Vencor, Inc., et al. are authorized to employ and retain The Blackstone Group LP as investment bankers for the debtors. WORLDCORP: Hearing on Approval of Disclosure Statement ------------------------------------------------------ On January 10, 2000, WorldCorp, Inc. and WorldCorp Acquisition Corp. filed their joint liquidating plan of reorganization and an accompanying Disclosure Statement for debtors' joint liquidating plan of reorganization. A hearing will be held on March 3, 2000 at 9:30 AM before the Honorable Mary F. Walrath in the US Bankruptcy Court for the District of Delaware, 824 Market Street, Wilmington, Delaware. WSR CORP: Seeks To Extend Exclusivity ------------------------------------- WSR Corporation, R&S/Strauss, Inc., National Automotive Stores, Inc. and National Auto Stores Corp. seek to extend the exclusive period within which to file a Chapter 11 plan and solicit acceptances thereto by 90 days, to and including May 11, 2000 and July 10, 2000 respectively. The debtors state that the requested extensions are necessary to afford the debtors sufficient time to complete the sale of substantially all of the assets of Strauss. February 29, 2000 is scheduled as the date for the debtors to conduct an auction and March 1,2-00 is scheduled as the date to approve the sale. Although the debtors are in the process of drafting preliminary plan provisions, it is impossible to finalize the terms of any plan or plans until the sale of the assets has taken place and the debtors know with certainty the amount of sale proceeds that will be available to fund a plan or plans. It is necessary for the debtors to request and obtain a sufficient extension of exclusivity to formulate, draft and negotiate the final terms of their plans. ********* 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., Trenton, NJ, and Beard Group, Inc., Washington, DC. Debra Brennan, Yvonne L. Metzler, Edem Alfeche and Ronald Ladia, Editors. Copyright 2000. 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. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *