/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/000616.MBXT R O U B L E D C O M P A N Y R E P O R T E R Friday, June 16, 2000, Vol. 4, No. 118 Headlines ACCESS1: Chapter 7 Bankruptcy ADELPHIA COMMUNICATIONS: Ratings Under Review; Possible Downgrade AGRIBIOTECH: Seeks Approval of Stipulation BAPTIST FOUNDATION: Seeks Court Approval to Hire Law Firm BRAZOS SPORTSWEAR: Seeks Approval of Disclosure Statement CALECA USA: Hearing on Confirmation of Chapter 11 Plan CALECA USA: Seeks Extension of Time To Assume/Reject Leases CONSECO: Charged With Violations of Securities Exchange Act CONSECO: Execs Pays Stock Loans CONSECO: Selling Stake in General Motors Building DIAGNOSTIC HEALTH: Motion To Reject Leases DYNEX CAPITAL: Announces Settlement of AutoBond Litigation GOLDEN OCEAN: Frontline Joins Creditors to Terminate Exclusivity GOLDEN OCEAN: Frontline Opposes Appointment of Examiner IRIDIUM: Chase Manhattan Sues Partners KPC GLOBAL CARE: Experiencing Financial Crisis LOEHMANN'S: Finalizing Exit Financing Facility MCA FINANCIAL: Tenth Amendment to Financing Order MMH Holdings: Committee Applies to Retain Financial Advisor MMH HOLDINGS: Committee Taps Kramer Levin Naftalis & Frankel MMH HOLDINGS: Committee Taps The Bayard Firm MOLL INDUSTRIES/AMM HOLDINGS: Moody's Lowers Debt Ratings NEW AMERICAN: Contract With Cambio Health Solutions NEXTWAVE TELECOM: Argues Decision By Appeals Court PENNCORP FINANCIAL: Consummation of Plan and Recapitalization PHYSICIANS RESOURCE GROUP: Authority To Sell Minority Interests PIETRAFESA CORP: Case Summary and 20 Largest Unsecured Creditors PONY EXPRESS: Skynet Holdings Announces Filing Of Bankruptcy SAFELITE GLASS: First Steps in Restructuring SAFETY-KLEEN: Court Refuses To Hear Appeal To Keep Landfill Open SIERRA ROCKIES: Files Plan and Disclosure Statement STONE & WEBSTER: Officers Named in Shareholder Class Action US DIGITAL: Directors and Officers Resign; Operations Cease VENCOR: Extends Maturity of Its DIP Financing BOND PRICING FOR WEEK OF JUNE 12, 2000 ********* ACCESS1: Chapter 7 Bankruptcy ----------------------------- An article in The San Diego Union-Tribune on June 9, 2000, states that Access1 was put into Chapter 7 liquidation. The internet service provider went into bankruptcy under Chapter 11 reorganization on April 20. The appointed trustee, James L. Kennedy says, "There is not enough income to pay operating expenses". The company may have a party interested in buying its customer database and domain name. ADELPHIA COMMUNICATIONS: Ratings Under Review; Possible Downgrade ----------------------------------------------------------------- Moody's Investors Service placed the debt ratings of Adelphia Communications Corporation (Adelphia) and its subsidiaries under review for possible downgrade. Affected debt instruments and their ratings include the following: thirteen issues of B1-rated senior notes and debentures of Adelphia totaling $2.89 billion; nine issues of B1-rated senior notes of subsidiary Century Communications totaling $2.324 billion (face value); two issues of B1-rated senior notes of subsidiary FrontierVision Holdings totaling $329 million (face value); one issue of B1-rated senior notes of subsidiary Olympus Communications totaling $200 million; one issue of B1-rated senior subordinated notes of subsidiary FrontierVision Operating Partners totaling $200 million; $4.515 billion of Ba2-rated senior bank credit facilities of subsidiaries Adelphia Cable Partners, Century-TCI California, Chelsea Communications, FrontierVision Operating Partners, Parnassos, and UCA; two issues of "b3"-rated preferred stock totaling $725 million; and the (P)B1/(P)B3/(P)"b3" shelf ratings for future senior/subordinated/preferred draws under Adelphia's remaining shelf registration. Moody's noted that it does not currently rate the recent $2.25 billion of senior bank credit facilities available to Adelphia's Century Holdings subsidiary, although it plans to assign one upon completion of its review. Adelphia's Ba3 senior implied and B1 senior unsecured issuer ratings were also placed under review for possible downgrade. The review follows the company's announcement yesterday that it plans to acquire additional cable assets for $836 million in cash. Notwithstanding the strategic merits of the transaction, this latest announcement is additive to Moody's prior concerns over Adelphia's significant appetite for acquisitions, at high cash flow multiples, and management's propensity to finance the same predominantly with debt, at least initially. Additionally, Moody's again remains concerned about the appropriateness of the notching of its debt ratings, which effectively delineates the relative risk of different debt classes based upon structural subordination and other issues, and suggests that the company may be reversing course in its efforts to reduce leverage and simplify the capital structure by removing the complexity embedded in its corporate structure. Finally, Moody's notes that the lines between Adelphia and its CLEC subsidiary Adelphia Business Solutions are becoming increasingly blurred, creating incremental debt overhang for the core cable company. Moody's will meet with management prior to concluding its review, which will focus primarily on the company's anticipated future operating and financing strategies in the context of the above referenced concerns. Headquartered in Coudersport, Pennsylvania, Adelphia Communications is one of the largest domestic cable system operators with approximately 5.7 million subscribers on a proforma basis for all announced transactions. AGRIBIOTECH: Seeks Approval of Stipulation ------------------------------------------ The Oregon ABT Seed Growers filed a motion for order approving a stipulation between AGriBioTech, Inc., debtor, its unsecured creditors committee and its lenders regarding delivery, cleaning and storage of 2000 seed crops. In essence the stipulation provides that (1) the debtor will make its seed processing facilities available to its seed growers for the delivery, cleaning, bagging and storage of 2000 seed crops; (2) that by so doing the debtor will not be deemed to have purchased or accepted delivery for purchase of the crops; (3) that the growers delivering the crops will be responsible for the resulting charges; and (4) that neither the lenders nor the committee will claim that the 2000 crops delivered pursuant to the stipulation are thereby property of the estate by virtue of such delivery or that security interest or liens thereby attach to the crops except liens relating to charges for cleaning, bagging and storage. The stipulation further reserves the rights and positions of all parties with respect to prior years' crops delivered to the debtor. BAPTIST FOUNDATION: Seeks Court Approval to Hire Law Firm ------------------------------------------ Baptist Foundation, which filed for Chapter 11 Bankruptcy Protection in November of last year, together with two committees of investors, seek the approval of the U.S. Bankruptcy Court to hire a law firm to sue former foundation officials. The foundation, which reportedly owes $590 million to 13,000 investors but lists assets of only $240 million also seeks the approval of the court to hire Dallas lawyer Clifton Jessup as trustee to oversee the sale of its assets. BRAZOS SPORTSWEAR: Seeks Approval of Disclosure Statement --------------------------------------------------------- On May 18, 2000, the debtors filed their Disclosure Statement with respect to a joint Chapter 11 plan of liquidation of Brazos Sportswear, Inc. and subsidiaries and Summary Plan and Disclosure statement with respect to joint Chapter 11 plan of liquidation of Brazos Sportsweraar, Inc. and subsidiaries. The hearing to consider the adequacy of the Disclosure Statements has been set for June 15, 2000 at 3:00 PM. The debtors request that the court set August 3, 2000 at 2:00 PM as the date and time for the commencement of the hearing on confirmation of the plan. The debtors request that the court set 4:00 PM on July 21, 2000as the last date and time for filing and servicing objections to confirmation of the plan. CALECA USA: Hearing on Confirmation of Chapter 11 Plan ------------------------------------------------------ The US Bankruptcy Court for the Southern District of New York has approved the Amended Disclosure Statement dated may 31, 2000 filed by Caleca USA Corp. A hearing to consider confirmation of the plan will be held before the Honorable Richard L. Bohanon, US Bankruptcy Judge on June 12, 2000 at 9:45 AM, One Bowling Green, New York, NY 10004-1408. CALECA USA: Seeks Extension of Time To Assume/Reject Leases ----------------------------------------------------------- A hearing has been scheduled before the Honorable Richard L. Bohanon, US Bankruptcy Court for the Souhtern District of New York, on June 28, 2000 at 9:45 AM on the debtor's motion to extend the debtor's time to assume or reject its non-residential real property leases. The debtor seeks an extension through and including the earlier of confirmation of a plan or August 15, 2000. The debtors' leases cover the debtors' only showroom in the United States and the debtor's entire manufacturing and administrative operations. Since the filing of its April application, the debtor ahs continued to increase sales. The major retailers, such as Bed Bath & Beyond, Linen & things and Macy's have continued to place replenishing orders. In addition, following the April trade shows, such retailers have begun to place orders for new patterns to be sold in their stores beginning in the fall. The debtor has also continued to remain current in its postpetition lease obligations. CONSECO: Charged With Violations of Securities Exchange Act ------------------------------------------------------------ Conseco and certain of its officers, directors and company insiders are charged with violations of the Securities Exchange Act of 1933. This action involves defendants' dissemination of materially false and misleading statements concerning the 8.7% Trust Originated Preferred Securities SM publicly traded securities purchased in or traceable to the public offering of these securities by Conseco and Conseco Financial Trust V which was completed on or about August 24, 1998; and the 9% Trust Originated Preferred Securities SM publicly traded securities purchased in or traceable to the public offering of these securities by Conseco and Conseco Financial Trust VI which was completed on or about October 8, 1998. CONSECO: Execs Pays Stock Loans -------------------------------- According to Bestwire on June 9, officials in Conseco Inc. repaid a total of $5 million of loans through a company program allowing employees and directors to buy stock. According to the filing with the Securities Exchange Commission, this is part of an overall plan to refinance the loan program. Conseco refinanced about $145 million out of $150 million that is due at the end of May. CONSECO: Selling Stake in General Motors Building -------------------------------------------------- According to The New York Times on June 9, 2000, financially distressed insurer, Conseco Inc., is selling its stake in the General Motors Building. The Carmel, Ind., based Conseco, had talks with partner, Donald J. Trump and may even look for a buyer for the entire complex. Two years ago, Conseco and Mr. Trump paid $800 million for the skyscraper, a 50-story tower that is situated near the southeast corner of Central Park. Its considered value today amounts to $2.25 billion. DIAGNOSTIC HEALTH: Motion To Reject Leases ------------------------------------------ Diagnostic Health Services, Inc. and its various subsidiaries request that the court enter an order authorizing the debtors to reject three leases of non-residential real property. Two of the leases are between Diagnostic Health Services, Inc. as lessee and R-M Medical Plaza II, LP as lessor. The leased property is located at 900 West Randolph Mill Road, Arlington, Texas, Suites 112 and 117. The third lease is between DHS Management Services, Inc. and Crescent Real Estate Equities Ltd. Partnership as lessor. The real property is approximately 10,900 square feet of office space at 2777 Stemmons Freeway, Dallas, Texas. The debtors have made arrangement to relocate their operations on the leased premises to a new location and therefore no longer need the real property referenced in the leases for business purposes. All of the leases have terms that are burdensome to the debtors and have no residual value. The leases are not necessary to the debtors' reorganization and the debtors state that rejection of the leases is in the best interests of the debtors, their creditors, and all other interested parties and should be approved. DYNEX CAPITAL: Announces Settlement of AutoBond Litigation ---------------------------------------------------------- Dynex Capital, Inc. (NYSE:DX) reported that it has settled the litigation relating to AutoBond Acceptance Corporation for a cash payment of $20 million to AutoBond. As part of the overall settlement, the Company received a complete release of all claims from AutoBond, and ownership of the AutoBond subsidiaries that issued the "funding notes" that were purchased from AutoBond by the Company. Mr. Thomas H. Potts, President, stated "The settlement removes the uncertainty raised by the litigation. Further, with the ownership of the AutoBond subsidiaries that issued the funding notes, the Company's investment in those funding notes is not at risk for any actions that AutoBond may have taken in the future." The Company also announced that it recently completed the sale of $46 million in multifamily loans. Mr. Potts stated "This is the first of three bulk loan sales we have scheduled to close this month. The proceeds of this sale were used to pay down warehouse borrowings. To the extent that the other two bulk loan sales are completed, the Company expects to be able to pay off all its warehouse borrowings by month end. The Company would still have short term credit obligations at month end of approximately $50 million pursuant to reverse repurchase agreements and approximately $80 million related to letters of credit issued on behalf of the Company which mature on July 31, 2000." The Company also announced that it continues to receive short- term waivers and extensions under its various credit facilities. Mr. Potts stated "We have been able to maintain a good productive working relationship with our lenders as we make progress on completing these loan sales." GOLDEN OCEAN: Frontline Joins Creditors to Terminate Exclusivity ---------------------------------------------------------------- Frontline, Ltd. joins in the motion of the Official Unsecured Creditors' Committee to terminate exclusivity. Frontline, the debtors and the Committee executed a Term Sheet which set for the the terms and conditions of a joint plan of reorganization for the debtors. Bentley has interfered and continues to interfere with the implementation of the joint term sheet. Frontline contends that Bentley, through its agents on the debtors' board of directors has interfered and continues to interfere with the implementation of the joint term sheet. According to Frontline, "Bentley's chief goal is to derail the implement of the joint term sheet so that Bentley can propose a competing plan of reorganization." Frontline states that Bentley acquired its stock solely to manipulate and control the plan process. Frontline also contends that it is a virtual certainty that any plan proposed by Bentley will have stiff opposition and require a cramdown for success. Already, the Committee and Frontline (which holds approximately $78 million of bonds - nearly 1/3 of the unsecured claims) opposes Bentley. Accordingly the plan process should be opened and exclusivity terminated to allow the Committee and Frontline to pursue their competing joint plan of reorganization. GOLDEN OCEAN: Frontline Opposes Appointment of Examiner ------------------------------------------------------- Frontline, Ltd. opposes the motion of Griffin Shipping, Inc. for entry of an order for the appointment of an Examiner. According to Frontline, Griffin is dissatisfied with the treatment of its unsecured claim under the Plan Term Sheet. Therefore Griffin filed a motion for an examiner the day after all parties executed the Plan Term Sheet as leverage to enhance its position in a any plan of reorganization by threatening to unnecessarily delay the reorganization of these cases. Frontline contends that the motion should be denied as a mere tactic aimed at delaying the confirmation process and generating a settlement payment. There is no other benefit to Griffin to dismissing these cases or increasing the administrative costs of this estate because if the cases were dismissed the debtors would return nothing to unsecured creditors, there is no evidence that any third party plan proponent or the debtors on a standalone basis would provide greater value to creditors and the returns under the plan term sheet are fair and equitable and satisfy the best interests of creditors. IRIDIUM: Chase Manhattan Sues Partners -------------------------------------- Chase Manhattan Bank has sued 17 members of bankrupt satellite telephone company Iridium LLC for $242.7 million, according to Reuters. Chase Manhattan claims it was in an obligation when Iridium defaulted on loan payments last year. In papers filed Friday in the U.S. District Court in Delaware, Chase Manhattan alleged the defendants had not met any reserve capital obligations, which secure the $800 million loan it made in December 1998 to subsidiary Iridium Operating LLC. Earlier this month, merchant bank Castle Harlan Inc. told the bankruptcy court it was interested in paying $50 million, plus five percent equity interest to creditors, to buy Iridium's assets. At the time, Iridium attorney William Perlstein testified that "the bid is a fraction of what the system costs, but substantially higher than the individual asset bids." He urged the bankruptcy court to accept the bid as the best available option. The court has scheduled a hearing for July 31 on the bidding process for the Iridium assets. Iridium and certain units filed for chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York last August. (ABI 15-June-00) KPC GLOBAL CARE: Experiencing Financial Crisis ---------------------------------------------- KPC Global Care, a major medical practice once owned by MedPartners Inc. is losing $2 million a month and nearing bankruptcy, according to The Associated Press on June 13, 2000. Dr. Kali Chauduri, who bought most of MedPartners' assets last year, said his company can stay afloat for only two to four months without increasing the monthly fees paid by health plans. Losses of about $2 million a month have prompted Chauduri since December to delay reimbursing vendors and medical specialists and to put off paying some doctors and medical suppliers. LOEHMANN'S: Finalizing Exit Financing Facility ---------------------------------------------- Loehmann's (Bronx, NY) is reported to be close to signing a letter of intent for an Exit Facility, while its financial advisors are in the process of finalizing the deal, according to a report appearing in this week's edition of F&D Reports' Scrambled Eggs newsletter. In the meantime, F&D notes, the Company is seeking Bankruptcy Court approval for a 45-day extension of its exclusive period to "sponsor" a Plan of Reorganization. The Company has also filed a motion seeking an extension of the deadline to either accept or reject leases through the Plan's effective date. The Company's motions will be heard at a hearing scheduled for June 27 in Wilmington. MCA FINANCIAL: Tenth Amendment to Financing Order ------------------------------------------------- The current Financing Order relates to expenses incurred through the end of May 2000. Accordingly, the debtors are seeking additional funding from the Bank Group. The debtors have requested that the Bank Group agree to permit the debtors to use additional cash collateral so that the debtors can continue to operate in June, July and August 2000. According to the budget attached to the proposed order, it is anticipated that use of approximately an additional $763,000 of cash collateral would fund the debtors' operations through approximately the end of August 2000. MMH Holdings: Committee Applies to Retain Financial Advisor ----------------------------------------------------------- The Official Committee of Unsecured Creditors of MMH Holdings, Inc., et al., debtors, seeks approval of the retention of Jeffrey Chanin and Company LLC as financial advisor to the Official Committee of Unsecured Creditors. The Engagement Letter provides for a monthly fee of $75,000 plus reimbursement of all reasonable costs and expenses. MMH HOLDINGS: Committee Taps Kramer Levin Naftalis & Frankel ------------------------------------------------------------ The Committee also seeks approval of retention of law firms Kramer Levin Naftalis & Frankel LLP and The Bayard Firm as co- counsel to the Committee. Kramer Levin is expected to render the following legal services: The administration of these cases and the exercise of oversight with respect to the debtors' affairs including all issues arising from or impacting the debtors, the Committee or these Chapter 11 cases; The preparation on behalf of the Committee of necessary applications, motions, memoranda, orders, reports and other legal papers; Appearances in Court and at statutory meetings of creditors to represent the interests of the Committee; The negotiation, formulation, drafting and confirmation of a plan or plans of reorganization and matters related thereto; Such investigation, if any, as the Committee may desire concerning, among other things, the assets, liabilities, financial condition and operating issues concerning the debtor that may be e relevant to these cases; Such communication with the Committee's constituents and others as the Committee may consider desirable in furtherance of its responsibilities; and The performance of all of the Committee's duties and powers under the Bankruptcy Code and the Bankruptcy /Rules and the performance of such other services as are in the interests of those represented by the committee. The principal attorneys expected to represent the committee in this matter and their current hourly rates are: Saul E. Burian ($425 per hour) , David M. Feldman ($320 per hour) and Amy Caton ($230 per hour). MMH HOLDINGS: Committee Taps The Bayard Firm -------------------------------------------- The Bayard Firm may be required to render for the Committee the following services: Providing legal advice with respect to its powers and duties as an official committee; Assisting in the investigation of the acts, conduct, assets, liabilities, and financial condition of the debtors, the operation of the debtors' businesses and any other matters relevant to the case or to the formulation of a plan of reorganization or liquidation: Preparing on behalf of the Committee necessary applications, motions, complaints, answers, order, agreements and other legal papers; Reviewing, analyzing and responding to all pleadings filed by the debtors and appearing in court to present necessary motions, applications and pleadings and to otherwise protect the interests of the Committee; and Performing all other legal services for the he Committee which may be necessary and proper in these proceedings. Bayard has advised the Committee that Bayard's hourly rates range from $300 to $375 per hour for directors, from $175 to $210 per hour for associates and from $110 to $115 per hour for paralegals. MOLL INDUSTRIES/AMM HOLDINGS: Moody's Lowers Debt Ratings --------------------------------------------------------- Moody's Investors Service lowered the ratings of Moll Industries, Inc.'s ("Moll") $100 million 11.75% senior unsecured notes, due 2004, to B3 from B1 and lowered the $130 million 10.5% senior subordinated notes, due 2008, to Caa1 from B3. The senior unsecured issuer rating is B3. The $68 million 13.5% senior discount notes, due 2009, issued at the parent holding company, AMM Holdings, Inc., were lowered to Caa2 from Caa1. Moll's $50 million secured credit facility was lowered to B2 from Ba3. The senior implied rating was lowered to B2 from B1. All ratings are on review for possible further downgrade. The downgrades reflect the company's deteriorating credit profile as evidenced by its operating performance which has resulted in tight liquidity and insufficient operating cash flow to support its high financial leverage and current interest payments. The company's weak operating margins result from a combination of lower than expected revenues and margin pressures from competition. Moody's review of the company's debt ratings is on-going, and there is a possibility of further downgrades. Moll has announced that it has commenced a tender offer to purchase up to $50 million aggregate principal amount of the existing $100 million senior unsecured notes for cash. Financing terms were not yet disclosed. Moody's review will focus on the company's ability to improve profitability and to enhance liquidity. Moll Industries Inc. is a Tennessee based full service manufacturer and designer of custom molded and assembled plastic components for a broad variety of customers and end markets throughout North America and Europe. NEW AMERICAN: Contract With Cambio Health Solutions --------------------------------------------------- By order of the US Bankruptcy Court, Middle District of Tennessee entered on June 5, 2000, the debtors, New American Healthcare Corporation et al. are authorized to enter into an executory contract with Cambio Health Solutions, LLC. Cambio provides advisory and consultative services related to operational and financial aspects of hospital management to the debtors. The debtor proposes to continue employing Cambio at its regular and customary daily and/or hourly rates for services rendered. Cambio's current hourly rates range from $80 to $360. Its current daily rates range from $640 to $2,880. NEXTWAVE TELECOM: Argues Decision By Appeals Court -------------------------------------------------- NextWave Telecom Inc. filed a petition in the Supreme Court to hear an appeal of a lower court's decision affirming the Federal Communications Commission's move to revoke the bankrupt company's wireless licenses and re-auction them, saying that "the decision ... effectively nullifies the jurisdictional and substantive foundations underlying Congress's carefully crafted bankruptcy scheme." (Dow Jones Business News; June 13, 2000) PENNCORP FINANCIAL: Consummation of Plan and Recapitalization ------------------------------------------------------------- Southwestern Life Holdings, Inc., formerly known as PennCorp Financial Group, Inc., has announced consummation of its plan of reorganization and recapitalization. Pursuant to the plan, the Company cancelled all of PennCorp's outstanding shares of preferred and common stock and issued a new class of common stock. The Company has also entered into a new senior secured revolving credit agreement with ING (U.S.) Capital, LLC and other lenders. In connection with the new credit facility, the Company repaid in their entirety all outstanding amounts owing under its prior existing senior credit agreement and its 9.25% senior subordinated notes that were due 2003. The new board of directors of Southwestern Life Holdings consists of Bernard Rapoport, Chairman and Chief Executive Officer, John T. Sharpe, Vice Chairman, James C. Comis III, Larry D. Jaynes, Robert N. Sheehy, Jr., and Steve R. Johnson. Mr. Johnson has been appointed President and Chief Operating Officer of Southwestern Life Holdings. In addition, David B. Little, Chief Administrative Officer, and David A. Commons, Chief Financial Officer, will serve as Senior Vice Presidents of Southwestern Life Holdings. "As the new Southwestern Life Holdings moves forward, we continue to take great pride in the stability, capitalization and financial strength of our insurance subsidiaries," Mr. Johnson said. "With the reorganization complete, we will continue to provide the high quality service that both our policyholders and the field force have come to expect." The Company has filed an application to trade on the Nasdaq National Market under the trading symbol "SWLH." Southwestern Life Holdings' principal operating subsidiary is Southwestern Life Insurance Company, headquartered in Dallas, Texas. Southwestern markets and underwrites life insurance, annuities, and long term care throughout the United States. Another subsidiary, Security Life and Trust Insurance Company, is expected to be merged into Southwestern by July. Upon completion of this merger, the combined companies will have more than $1.8 billion in assets, 350,000 policyholders, and a field force exceeding 8,000 agents. PHYSICIANS RESOURCE GROUP: Authority To Sell Minority Interests --------------------------------------------------------------- The debtor, Physicians Resource Group, Inc. seeks the court's approval of the sale agreement for minoity surgery center interests in Gramercy to Gramercy - GP and Clear Lake to Clear Lake - GP. The Seller is PRG Surgery, Inc. and the Buyer is Surgicare of Gramercy, Inc. and Bay Area Surgicare Center, Inc. Subject to the provisions of the agreement the consideration to be paid to PRG Surgery, Inc., seller, is $1,381,338. A hearing on the matter is set for June 27, 2000 at 9:15 AM. PIETRAFESA CORP: Case Summary and 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Pietrafesa Corporation(The) 7400 Morgan Road Liverpool, NY 13090 Type of Business: Manufacturer and importers of men's apparel for proprietary and third-party brands. Petition Date: June 12, 2000 Chapter 11 Court: District of Delaware Bankruptcy Case No.: 00-02379 Judge: Sue L. Robinson Debtor's Counsel: Robert S. Brady Young, Conaway, Stargatt & Taylor PO Box 391 Wilmington, DE 19899-0391 Tel:(302) 571-6690 Total Assets: $ 31,930,000 Total Debts: $ 29,333,000 20 Largest Unsecured Creditors Burlington Industries, Inc. PO Box 75080 Charlotte, NC 28775-5080 Ed Schuster Tel:(366) 379-2000/3654 Fax:(366) 379-3393 Trade $ 1,271,064 Peter Lister 551 Madison Avenue New York, NY 10022 Note $ 800,000 Warren Corporation 8 Furnace Ave Stafford Spring, CT 06076 Luba Maher Tel:(860) 684-2766 Fax:(732) 398-5232 Trade $ 673,501 Lanficio Giovanni Tonella & Figli, SPA 13867 Pray Biellese(BI) Via Molino ITALY 39-015-767-121 Trade $ 308,434 Windsong, Inc. Disputed $ 225,000 A. Frank & Sons, Inc. Trade $ 211,442 Rand International Trading Trade $ 209,722 Uorne Pin Trade $ 202,418 Royal Sumalliance Insurance Co. Insurance $ 189,583 Roberts Sheridan & Kotel, P.C. Services $ 170,000 Moda Spiga Trade $ 167,875 Tessitura Marco Pastorelli, SPA Trade $ 161,644 Ace Binding Co. Inc. Trade $ 124,981 Packquisition Corp. Trade $ 120,531 Ernst & Young Services $ 114,495 M.B. Perform SPA Trade $ 113,496 Merina, A.S. Trade $ 102,226 Kufner Textile Corporation Trade $ 100,920 GMAC Financing Factor $ 100,127 Bremen-Bowdon Investment Co. Contractor $ 97,897 PONY EXPRESS: Skynet Holdings Announces Filing Of Bankruptcy ------------------------------------------------------------ Skynet Holdings, Inc. (OTC:SKYNE), a provider of customized, same day, next day, and global time sensitive delivery services announced today that its wholly owned subsidiary Pony Express Delivery Services, Inc., has suspended substantially all of its operations, with the exception of operations in the State of Florida, and has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Northern District of Georgia, Atlanta, Georgia. "We regret this very unfortunate development. However, due to Pony Express' deteriorating economic position, Skynet Holdings is no longer able to absorb the ongoing losses experienced by Pony Express," said Donald L. Harrill, President & CEO of Skynet Holdings, Inc. Harrill continued that "although Pony Express will cease domestic operations with the exception of Florida, worldwide operations of Skynet Holdings' other subsidiaries continue uninterrupted. Skynet Holdings' three domestic offices -- offices in England, Malaysia, and Australia -- and the worldwide delivery network of more than 1,100 independently owned and operated Skynet Worldwide express offices in over one hundred countries continue normal operations." In a related development, Skynet Holdings also announced that its wholly owned subsidiary Fleet Acquisition Corp. and Courier Express, Inc., a wholly owned subsidiary of Pony Express Delivery Services, Inc., also filed petitions for protection under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Northern District of Georgia and suspended all operations. Skynet Holdings, Inc., headquartered in Atlanta, Georgia, is a full service provider of global transportation delivery services operating primarily as a domestic regional and international express courier for time sensitive documents and packages. Services include time certain deliveries within 24-48 hours of pickup; next flight out services for same day expedited deliveries; local ground transport; freight forwarding services; bulk shipment of mass mailing materials for local distribution; and global logistics services incorporating the company's proprietary computerized tracking system. Skynet operates company-owned SkyNet Worldwide Express offices in England, Malaysia and Australia. In addition, Skynet provides worldwide delivery services to its customers through a network of more than 1,100 independently owned and operated "SkyNet Worldwide Express" offices in over 100 countries. SAFELITE GLASS: First Steps in Restructuring -------------------------------------------- Safelite Glass Corp. gained approval for the important first steps in a financial reorganization that will result in a 50 percent plus reduction in the Company's long-term debt. The Company's first day motions were approved by the court late today. These motions included: continuation of all Safelite associate compensation and benefits plans; all customer sales, support, warranties, and service activities; all insurance policies; and payment of funds due to the company's vendors. As a third-party administrator of a number of insurance and fleet glass programs, Safelite has also ensured its ability to pay independent auto glass shops. The company has also negotiated credit facilities to assist in funding operations during the court process. The company has taken the action as part of its efforts to reorganize its capital structure and preserve value for its creditors. Safelite management has submitted a "pre-negotiated" reorganization plan, and gained agreement to the plan from over 75% of their banks and bondholders. The filing will allow the Company to complete their restructuring while continuing with business as usual. "We are delighted to see the first day motions approved by the court," said Safelite President and CEO John Barlow. "This means that business will continue as usual for our associates, our vendors, independent shop partners, and our clients and their customers. Safelite will be able to maintain our traditionally high levels of service with virtually no disruption." SAFETY-KLEEN: Court Refuses To Hear Appeal To Keep Landfill Open ---------------------------------------------------------------- The Associated Press reports on June 14, 2000 that financially troubled Safety-Kleen Corp. can no longer accept hazardous waste at the site just 1,200 feet from Lake Marion in Sumter County because the state Supreme Court refused to hear an appeal to keep a landfill open, but a spokesman said the company would appeal to the U.S. Supreme Court. State regulators say the 23-year-old landfill is at capacity. The company says the landfill has plenty of room left and that lower court rulings on the dump's capacity are flawed. SIERRA ROCKIES: Files Plan and Disclosure Statement --------------------------------------------------- Sierra-Rockies Corporation (OTC: SIRK), announced today that it has filed its Plan and Disclosure Document in its Chapter 11 Proceeding. The Plan calls for the company to continue in the Art Business, however, it intends to move to the Internet as its primary marketing emphasis. Daniel Lezak, President of SIRK, indicated that approximately $6 Million in newly acquired art would be added to the inventory of the company in addition to working capital and new management that is familiar with marketing art on the internet are all part of the Disclosure Information included in these documents filed with the court. Lezak also stated that the stock would be reverse split with one new Unit issued for each 25 existing shares. The Units will consist of shares and warrants. He also indicated that approved creditors would receive one Unit for each $5 in claims that are approved by the court. Finally, Lezak indicated that the Court and the Creditors must approve the Plan before it can be implemented and this might require further revisions. STONE & WEBSTER: Officers Named in Shareholder Class Action ----------------------------------------------------------- Berman, DeValerio & Pease LLP issues the following press release: Two officers of Stone & Webster, Inc., H. Kerner Smith and Thomas Langford, are named defendants in a shareholder lawsuit filed by Berman, DeValerio & Pease, LLP (http://www.bergmanesq.com/).The case, which alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, was filed on behalf of all persons and entities who purchased the common stock of Stone & Webster during the period of April 27, 1999 through and including April 28, 2000 (the "Class Period") and who suffered losses on their investments. Since its filing for bankruptcy protection, the action against Stone & Webster is automatically stayed. The case involves a manipulation of financial statements in which, among other acts of deception, defendants knowingly or recklessly overstated S&W's results of operations, revenues, expenses, net worth and income for the fiscal year 1999. US DIGITAL: Directors and Officers Resign; Operations Cease ----------------------------------------------------------- All of the directors and officers of U.S. Digital Communications, Inc. (OTC Bulletin Board: USDI) have resigned, effective immediately. Presently the company has no employees, officers, or directors. The corporation has no assets, no revenues, and no money to continue in business. In addition, the corporation does not have the capability to transact business in the future. VENCOR: Extends Maturity of Its DIP Financing --------------------------------------------- Vencor, Inc. (the "Company") announced on June 14, 2000 that it has agreed with its lenders to amend the Company's debtor-in- possession financing to extend the maturity until September 30, 2000. The Amendment also revises certain covenants and permits the Company to file its plan of reorganization through July 18, 2000. The Company also announced that it has entered into a commitment letter with certain of the DIP lenders to finance an amended and restated debtor-in-possession credit agreement in an aggregate principal amount of $90 million. The Restated DIP would become effective in the event the Company became involved in a legal proceeding against Ventas, Inc. (NYSE: VTR) concerning the transactions in which the Company was spun-off from Ventas or the master lease agreements executed in connection with the spin-off. Such a legal proceeding currently would constitute an event of default under the existing DIP Financing. The Restated DIP would have a one-year term beginning on its effective date. The consummation of the Restated DIP is subject to other customary conditions contained in the Commitment Letter. As previously disclosed, the Company has reached an understanding with certain of its senior bank lenders, certain holders of the Company's $300 million 9 7/8% Guaranteed Senior Subordinated Notes due 2005 and the advisors to the official committee of unsecured creditors regarding the broad terms of a plan of reorganization. The Company also has made substantial progress in its conversations with the Department of Justice regarding a settlement of the ongoing investigations. The Company has continued to engage in discussions with Ventas to obtain its support for a consensual plan of reorganization. At this time, only Ventas is in disagreement with the Company over the terms of a consensual plan of reorganization. While the filing of a consensual plan of reorganization is the Company's preferred outcome, the Company believes that it is taking prudent steps in the event a consensual plan of reorganization with Ventas cannot be reached. The DIP Financing and existing cash flows will be used to fund the Company's operations during its restructuring. As of June 13, 2000, the Company had no outstanding borrowings under the DIP Financing. The United States Bankruptcy Court for the District of Delaware (the "Court") must approve the Amendment and the Commitment Letter. The hearing on this motion is scheduled for June 29, 2000. Vencor and its subsidiaries filed voluntary petitions for reorganization under Chapter 11 with the Court on September 13, 1999. Vencor, Inc. is a national provider of long-term healthcare services primarily operating nursing centers and hospitals. BOND PRICING FOR WEEK OF JUNE 12, 2000 ====================================== DLS Capital Partners, Inc., bond pricing for week of June 12, 2000 Following are indicated prices for selected issues: Acme Metal 10 7/8 '07 13 - 15(f) Advantica 11 1/4 '08 65 - 67 Asia Pulp & Paper 11 3/4 '05 70 - 72 Conseco 9 '06 71 - 73 E & S Holdings 10 3/8 '06 35 - 37 Fruit of the Loom 6 1/2 '03 51 - 53(f) Genesis Health 9 3/4 '05 13 - 15(f) Geneva Steel 11 1/8 '01 15 - 17(f) GST Telecom 13 7/8 '05 52 - 54(f) Iridium 14 '05 4 - 5(f) Loewen 7.20 '03 34 - 36(f) Paging Network 10 1/8 '07 39 - 41(f) Pathmark 11 5/8 '02 22 - 24(f) Revlon 8 5/8 '08 48 - 50 Rite Aid 6.70 '01 82 - 84 Service Merchandise 9 '04 6 - 8(f) Trump Atlantic 11 1/4 '06 70- 72 TWA 11 3/8 '06 36 - 40 Vencor 9 7/8 '08 12 - 14(f) ********* 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 * * *