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/raid1/www/Hosts/bankrupt/TCR_Public/000717.MBXT R O U B L E D C O M P A N Y R E P O R T E R Monday, July 17, 2000, Vol. 4, No. 138 Headlines ACME METALS: Seeks Extension To Assume/Reject Leases AQUA VIE BEVERAGE: Net Loss of $1.37MM For Nine Month Period AUREAL INC: Committee Agrees to Extension of Exclusivity BAUPOST FUND: Reports 10.28% Gain For Six Months CLARIDGE: High River/AREP Objects to Committee's Professionals CLARK MATERIAL: Receives Increased Financing Commitment EAGLE GEOPHYSICAL: Emerges From Bankruptcy FRUIT OF THE LOOM: Farley Objects To Examination of 13 Charities GENESIS/MULTICARE: Trustee Schedules Meeting To Form Committees GST TELECOM: Motion To Supplement Retention of Deloitte & Touche iPCS INC./ iPCS WIRELESS: Moody's Assigns Ratings INTEGRATED HEALTH: Applies to Employ Vinick & Doherty INTEGRATED HEALTH: Court Approves Agreement With SNH JUMBOSPORTS: Files Second Amended Plan LOEWEN: Seeks To Honor Prepetition Debt to Non-Debtor Affiliate MARINER: Court Approves Agreement With SNH MEDPARTNERS: Motion For Approval of Sale Procedures MONEYSWORTH & BEST: Files For Bankruptcy PRESCIENT TECH: Spatial Acquires Prescient Tech for $1.4 Million PRIME SUCCESSIONS: Files Chapter 11 Petition and Plan SAFETY-KLEEN: Judge Denies Bankruptcy Transfer, Grants TRO SAFETY-KLEEN: Applies To Employ Arnold as Environmental Counsel STONE & WEBSTER: Court Approval for Acquisition of Assets SUN HEALTHCARE: Appoints New Chairman and New CEO SYBASE: Prospectus Relating to 7,381,917 Shares THERMATRIX INC: First Quarter Results UNITED COMPANIES: Receives Approval for Disclosure Statements UNITED KENO: Extended Protection From Creditors ********* ACME METALS: Seeks Extension To Assume/Reject Leases ---------------------------------------------------- The debtors, Acme Metals Incorporated, and its debtor affiliates seek a court order further extending the time within which the debtors shall assume or reject unexpired leases of nonresidential real property. The debtors seek an order pursuant to section 365 (d)(4) of the Bankruptcy Code further extending for 120 days, to and including November 17, 2000 the time in which they must move to assume or reject their unexpired leases of nonresidential real property. The debtors are lessees or sublessees with respect to approximately 25 unexpired leases of nonresidential real property. The Unexpired leases are an integral part of the debtors' businesses as the premises subject to such leases include right- of-ways used in transporting goods and raw materials between facilities as well as leases for sales and business offices. The leases are vital to the debtors' continued operations of manufacturing and fabricating steel. At this stage of the reorganization process, given the complexity of the cases and the burdensome and time-consuming task of evaluating the unexpired leases, the debtors have simply not been able to assess the value or marketability of unexpired leases and make determinations with respect to which unexpired leases should be assumed and which, if any, should be rejected. AQUA VIE BEVERAGE: Net Loss of $1.37MM For Nine Month Period ------------------------------------------------------------ Aqua Vie Beverage Corporation had net losses of $663,077 and $1,374,530 for the three and nine month periods ended April 30, 2000 on revenues of $34,462 and $64,712 respectively. This compares to net losses of $386,645 and $1,092,066 for the three and nine month periods ended April 30, 1999 on respective revenues of $7,791 and $8,733. Subsequent to the end of the April 30th period, on June 5, 2000, the company received a commitment from two investment portfolios controlled by unrelated third parties for financing up to an aggregate amount of $6 million through September 30, 2000, to be used in bottling production and to address an order backlog accumulated subsequently, as well as general working capital. Initial funding related to this commitment has been received by the company. AUREAL INC: Committee Agrees to Extension of Exclusivity --------------------------------------------------------- The Official Committee of unsecured creditors of Aureal, Inc. d/b/a Silo.com does not oppose the motion of the debtor to extend by 120 days (until December 1, 2000 and January 30, 2001, respectively), the deadlines by which the debtor has the exclusive right to file a plan of reorganization and solicit acceptances of such plan, provided that any extension is without prejudice to the right of any party in interest, including the Committee to request at a later date, if circumstances warrant, that those deadlines be shortened or lengthened. BAUPOST FUND: Reports 10.28% Gain For Six Months ------------------------------------------------ Baupost Fund reports a gain of 10.28% for the six months ended April 28, 2000. The Fund achieved the gain amidst what it refers to as "a volatile equity market environment where both growth and value managers experienced difficulty". Indeed, two of the most notable investors of the twentieth century effectively ended their investment careers this year after incurring substantial losses. Ironically, Julian Robertson's Tiger Fund closed its doors largely as a result of missing out on technology stocks in recent years, while Stanley Druckenmiller of the Soros organization quit as a result of losses experienced from his technology holdings. This bucking bronco of a market has made it hard for nearly all investors, regardless of approach, to hang on. The Baupost Fund exists to accommodate the family members and friends of Baupost clients. It participates ratably in all of the investment ideas generated at Baupost which are consistent with legal guidelines applicable to the Fund and with the Fund's investment objective. The investment objective of the Fund is capital appreciation, with income as a secondary goal. The Fund seeks to achieve its objective by profiting from market inefficiencies using a value-oriented and, often, an event driven approach. Baupost indicates it is not seeking to keep up with any particular market index or benchmark. Rather, it is attempting to achieve good risk-adjusted investment results over time through the successful implementation of its investment philosophy. Its current portfolio is broadly diversified with a concentration in undervalued U.S. equities, many with a partial or full catalyst for value realization. For a schedule of the Fund's investments at April 28, 2000 access http://www.sec.gov/cgi- bin/srch-edgar?0001072613-00-000708, free of charge on the Internet. The Fund reported gross investment income of $1,917,614 for the six months ended April 28, 2000, with net investment income of $23,403. CLARIDGE: High River/AREP Objects to Committee's Professionals -------------------------------------------------------------- High River Limited Partnership and American Real Estate Partners object to the application of the Secured Noteholders Committee to retain US Bancorp Libra as financial advisor, and the Committee's application to retain PricewaterhouseCoopers, LLP as appraiser and valuation consultant, and the motion of the committee for an order allowing the cost of liability insurance policy as an administrative expense. High River/AREP incorporates and adopts the debtors' objection and the objection of the Official Committee of Unsecured Creditors to the professionals and High River/AREP incorporates and adopts the objections of the Official Committee of Unsecured Creditors to the motion allowing the cost of the insurance policy as an administrative expense. CLARK MATERIAL: Receives Increased Financing Commitment ------------------------------------------------------- CLARK Material Handling Company announced that its subsidiary, CLARK Material Handling Asia, has received an increased financing commitment from Korea Development Bank (KDB). The new facility represents a 250% increase over the Company's prior facility with KDB and totals $35 million. Additionally they have established a new working capital facility of 5 billion Korean Won or $4.5 million. "Our operations in Korea include a state-of-the-art production facility and represent an important component of CLARK's competitive strength," Dr. Martin M. Dorio, Jr., Chairman and Chief Executive Officer stated. "Attaining additional Asian financing is a very important element of the manufacturing transition plan approved by the court on June 27. It will enable CLARK to execute the Asian portion of the plan as approved." Last week, CLARK Material Handling Company announced that it had received court approval for permanent debtor-in-possession financing of up to $45 million from Congress Financial Corporation in the United States. "We are very pleased with the high level of lender support we are receiving," stated Dr. Dorio. "We are well-positioned to continue to meet our post Chapter 11 filing obligations to suppliers and, in turn, provide dealers and customers with the quality products, parts and services they have come to expect from CLARK." As an industry leader since it invented the first material handling truck in 1917, CLARK has built more than one million forklifts during its history. Today, CLARK machines comprise one of the largest fleets of forklifts in North America with 250,000 in use and more than 350,000 in operation throughout the world. CLARK also produces and markets forklifts in Asia and Europe as well as manual and electric pallet trucks, stackers, tow tractors, dock levelers, vehicle restraints, elevating docks and lift tables. CLARK operates facilities in Lexington, KY; Pell City, AL; Brampton, Canada; Mulheim, Germany and Changwon, South Korea and distributes its products through a worldwide network of nearly 30O dealers. CLARK markets its products under a variety of trademarks including CLARK, Samsung (forklifts), Blue Giant, and Powrworker. For additional information, visit CLARK's website at http://www.clarkmhc.comor call toll free 1-800-780-CLARK, or 1- 800-770-PART. EAGLE GEOPHYSICAL: Emerges From Bankruptcy ------------------------------------------ According to the Houston Business Journal, Eagle Geophysical Inc. and its subsidiaries have emerged from bankruptcy. The amended joint plan of reorganization was approved by a U.S. Bankruptcy Court in Delaware. The company emerges with new access to a revolving credit facility, $12 million of stockholders' equity and approximately $3 million of secured debt. Ongoing seismic acquisitions of Eagle Geophysical will continue to operate in Texas and Louisiana Gulf Coast area of the United States, and of western Canada. FRUIT OF THE LOOM: Farley Objects To Examination of 13 Charities ---------------------------------------------------------------- Mr. Farley objects to the Debtors' requests to examine 13 charities, arguing that they would invade privacy rights since charitable donations are personal business. Mr. Farley points to a Missouri bankruptcy court decision, In re Apex Oil Co., 101 B.R. 92, 103 (Bakr E.D. Mo. 1989), for the proposition that "[t]hird parties should be insulated from the public forum when their personal documents do not constitute judicial records and they are not parties to litigation." Also, Mr. Farley urges, the Court should be sensitive to the potential embarrassment charities and donors may suffer if the Examinations the Debtors request are permitted to go forward. GENESIS/MULTICARE: Trustee Schedules Meeting To Form Committees --------------------------------------------------------------- The United States Trustee for Region III has scheduled an organizational meeting for the purpose of forming one or more official committees of the Debtors' creditors. That meeting will be held on Tuesday, July 11, 2000, in Wilmington, Delaware. Contact the Office of the U.S. Trustee at 215-597-4411 for additional details. GST TELECOM: Motion To Supplement Retention of Deloitte & Touche ---------------------------------------------------------------- The debtors, GST Telecom Inc., et al., seek authority to supplemental the retention and employment of Deloitte & Touche LLP and Deloitte Consulting LLC as financial, tax and restructuring consultants. The debtors request that the court authorized them to enter into and perform the Engagement Letter, that they be allowed to retain and employ the temporary staffing services of one senior manager of Deloitte & Touche LLP(Canada) on an "as requested" basis to assist the debtors in evaluating their operations, preparing a business plan and assisting the debtors' accounting staff with routine reporting and tax matters, and that the debtors be allowed to pay Deloitte & Touche LLP (Canada) $6,700 per week plus expenses. The debtors have lost numerous key employees, and an enormous burden has been places on the employees of the debtors, particularly on the controller and the accounting staff. Therefore, the debtors propose to utilize one senior manager from Deloitte & Touche LLP(Canada) to provide to the debtor temporary staffing services. iPCS INC./ iPCS WIRELESS: Moody's Assigns Ratings ------------------------------------------------- Moody's Investors Services assigned a Caa1 rating to iPCS Inc.'s (iPCS) $150 million (gross proceeds) senior discount notes due 2010 and a rating of B2 to iPCS Wireless, Inc.'s $140 million senior secured credit facility. The senior implied rating of iPCS Inc. is B2 and the outlook for the ratings is stable. The ratings reflect the early stage of the company's PCS operations, the highly competitive environment of the wireless communications industry, and Moody's expectation of negative cash flows over the next several years. The ratings also incorporate the strengths and weaknesses of the issuer's relationship to and agreements with Sprint PCS, and the positive performance to date of the Sprint PCS affiliate program. The rating on the Rule 144a senior discount notes recognizes the benefit of guarantees from operating subsidiaries, which are contractually subordinated to borrowings under the secured credit facility. The B2 rating on the bank credit facility considers that the collateral provides the lenders with moderate protection in a distressed scenario given the company's early stage of development. The senior discount notes are being sold in a privately negotiated transaction without registration under the Securities Act of 1933 (the "Act") under circumstances reasonably designed to preclude a distribution thereof in violation of the Act. The issuance has been designed to permit resale under Rule 144A. iPCS is the exclusive provider of Sprint PCS wireless services and products to a service area covering 35 markets and over 7 million POP's in the mid-western United States. As with all Sprint PCS affiliate agreements, iPCS does not own the wireless licenses it uses but leases the spectrum from Sprint PCS on a long-term contract basis. iPCS is responsible for building out the network, signing subscribers, and managing the operations once complete. In return, Sprint receives an 8% fee on all of the affiliates' service revenues excluding handsets, accessories, and certain roaming revenues. The company's proposed $150 million notes offering, $140 million bank credit facility, and contributions from equity investors and new equity issuance is expected to fully fund its business plan through the period of network buildout. iPCS will derive immediate benefit through Sprint's brand name recognition, a nationally focused sales and marketing organization, access to extensive retail distribution channels and purchasing power for network and customer equipment. iPCS will also exercise its option as a type II affiliate under the agreement to utilize Sprint's operation support systems (back office, billing, etc.) giving it a well trained and scalable operational support system without the capital costs and ramp-up time expected with a greenfield operation. Notwithstanding all these advantages, Moody's expect the development of a meaningful subscriber base to result in operating cash flow losses over the next several years and does not expect leverage to moderate below the 5 times level until 2005. Moreover, Moody's is concerned about the lack of asset protection available to bondholders. iPCS owns no spectrum, and its network assets will be pledged as collateral to the lenders under the bank credit facility. Based in Geneseo, Illinois, iPCS, Inc. is the exclusive provider of Sprint PCS products and services in a territory covering over 7 million people in the mid western United States. INTEGRATED HEALTH: Applies to Employ Vinick & Doherty ----------------------------------------------------- The Debtors have employed V&D as litigation management counsel since 1990. Since the petition date, V&D has continued to perform such services pursuant to the Court's order governing the employment of ordinary couse professionals. In anticipation that Vinick & Docherty's monthly fees and expenses will exceed the $25,000 per month cap under the Order, the Debtors submit a separate application to seek the Court's authorization to employ V&D as their Special Counsel. The Debtors contemplate that V&D will perform litigation management services and will assist the Debtors' in-house counsel in this respect. V&D will not undertake any representation related to the prosecution of the Debtors' chapter 11 cases, or any plan of reorganization. Specifically, V&D will render professional services in: (1) management and supervision of the Debtors' litigation in the commercial, employment, discrimination and negligence areas; (2) assisting Debtors' in-house counsel in regulatory, compliance, patient care and fraud and abuse issues; (3) assisting the Debtors' in-house counsel in collections matters against institutional and individual account debtors; (4) assisting the Debtors' auditors and securities counsel in connection with litigation risk valuations; and (5) advising and assisting the Debtors in connection with ordinary course insurance, regulatory and corporate matters. The Debtors believe that V&D is well qualified, and is uniquely able to represent the Debtors for its familiarity with all known pending federal investigations relating to the Debtors' businesses and regulatory affairs. Subject to court approval, the Debtors will pay V&D hourly rates of: James M. Docherty $ 225 David M. Wachsman $ 200 Phillip J. Mancuso $ 175 Andrew D. Schildiner $ 175 Paralegals $ 75 Plus out of pocket expenses. The Debtors represent that the charges by V&D are reasonable, that to the best of their knowledge, the members and associates of V&D do not have any connection with the Debtors or other parties in interest, and the respective attorneys of V&D do not hold any interest adverse to the Debtors or their estates. (Integrated health Bankruptcy News Issue 6; Bankruptcy Creditors' Service Inc.) INTEGRATED HEALTH: Court Approves Agreement With SNH ---------------------------------------------------- Senior Housing Properties Trust (NYSE:SNH) announced that its agreements with Mariner Post-Acute Networks, Inc. (OTC:MPANE) and Integrated Health Services, Inc. (OTC:IHSV) were approved by the Bankruptcy Courts supervising the Chapter 11 proceedings by Mariner and Integrated. The Court approvals in the Mariner case was received on June 29, 2000, and in the Integrated case on July 7, 2000. A spokesman for SNH pointed out that the Bankruptcy Court's approvals are an important step in implementing the settlement agreements with Mariner and Integrated which were announced on March 22, 2000 and April 12, 2000, respectively. Full implementation of the settlement agreements is still contingent upon state licensing and other regulatory approvals for SNH subsidiaries to operate the facilities formerly leased by SNH to Mariner and Integrated. However, assuming that these licenses and approvals are forthcoming, the Bankruptcy Court's approvals provide that the settlements will be financially effective as of July 1, 2000. The previously announced settlement with Mariner provides as follows: -- The leases for 26 nursing homes (3,482 beds) between SNH, as lessor, and Mariner, as lessee are relinquished by Mariner. -- Approximately $24 million of cash and securities held by SNH to secure Mariner's lease obligations and related guarantees is retained by SNH. -- SNH will assume operations for its own account at 17 of these 26 properties. Title to five of these 26 properties is transferred to Mariner which will continue those operations. The remaining four nursing homes are now subleased to two private companies and SNH will negotiate with these subtenants for their continued operations of these properties. The previously announced settlement with Integrated provides as follows: -- SNH had leased or provided first mortgage financing to Integrated for 39 nursing homes. -- The lease for one nursing home in Pennsylvania (140 beds) is amended to provide a new ten-year term at $100,000 per month ($1.2 million per year) plus annual escalations. As amended, this lease has been assumed by Integrated as a priority expense in its bankruptcy effective January 1, 2000. -- SNH's mortgage investment secured by one nursing home in Louisiana (118 beds) is cancelled and Integrated will continue to own and operate that property. -- Integrated's lease and mortgage obligations to SNH for the remaining 37 nursing homes are relinquished by Integrated. -- In addition to rent for the Pennsylvania property described above, Integrated has paid SNH a total of approximately $3 million for its use and occupation of the SNH leased and mortgaged properties and other claims arising from the date of the Integrated bankruptcy filing on February 2, 2000 until June 30, 2000. -- As further compensation for the unpaid mortgage and rent Integrated will convey nine nursing homes (648 beds) to SNH. -- SNH will operate for its own account 41 proprieties with 3,901 beds including 33 of the 37 properties for which leases and mortgages are cancelled and eight of the nine properties received from Integrated. -- Leases for five properties formerly operated by Integrated have been assumed by HEALTHSOUTH (NYSE: HRC). David J. Hegarty, President of SNH, issued the following statement to accompany this announcement: "Senior Housing is pleased that the Bankruptcy Court has approved its settlement arrangements with Mariner and Integrated. We expect that licensing of SNH subsidiaries to operate these properties to take between 30 and 90 days depending upon the procedures in the different States in which these facilities are located. In the interim, now that the Court has approved these agreements we will begin to take a more active role in the management of operations at these properties and expect that the turnaround process will begin. Assuming that SNH affiliated entities are fully licensed, the term of our agreements with Mariner and Integrated provide that SNH will have the benefit of the properties' operating in lieu of rent effective July 1, 2000." Senior Housing Properties Trust is a real estate investment trust headquartered in Newton, MA which owns nursing homes and senior living properties located throughout the United States. JUMBOSPORTS: Files Second Amended Plan -------------------------------------- The debtors, JumboSports, Inc. have filed with the Bankruptcy Court their Second Amended Plan under Chapter 11 of the US Bankruptcy Code dated as of June 15, 2000, and the Bankruptcy Court has approved the debtor's Second Amended Disclosure statement dated as of June 15, 2000, relating to the plan. A confirmation hearing will be held on August 17, 2000 at 9:30 AM. Any party desiring to object to confirmation of the plan shall file its objection no later than August 10, 2000. LOEWEN: Seeks To Honor Prepetition Debt to Non-Debtor Affiliate --------------------------------------------------------------- The Debtors tell the court that, inadvertently, they were making Monthly Payments without seeking prior approval to a non-debtor affiliate, Security Industrial Insurance Company for prepetition debt under the terms of a promissory note, issued by Debtor Loewen Louisiana Holdings, Inc. The original principal amount of the LLHI Note was $6,600,000, bearing interest at the rate of 10% per annum. The terms of the LLHI Note also provide for Monthly Payment of $59,974 through March 26, 2021. After accounting for these payments, the outstanding principal balance under the note is $6,285,505. The Debtors explain that the LLHI Notes were created in connection with the Loewen companies' 1996 acquisition of assets now held by Security Industrial. In connection with that acquisition and a series of related transactions, the Debtors formed a company that later was renamed Security Industrial to consummate the purchase of the assets of certain insurance companies. Security Industrial is a wholly owned direct subsidiary of Mayflower National Life Insurance Company, which in turn is a wholly owned direct subsidiary of Debtor Loewen Life Insurance Group, Inc. Loewen Life is a wholly owned direct subsidiary of LGII. Through the same set of transactions, LLHI, another wholly owned direct subsidiary of LGII, purchased from the predecessor of Security Industrial and certain other entities several funeral homes and the parcels of real property on which the funeral homes were located. In connection with these and related intercompany transactions, LLHI issued the LLHI Promissory Note. Because the Court has not authorized any payments on the LLHI Note, the Debtors have not made the Monthly Payments due in April or May 2000. In addition, the Debtors have advised Security Industrial that the Monthly Payments for June 2000 and the Future Payments for subsequent months cannot be made during the pendency of the Debtors' chapter 11 cases absent authorization by the Court. To secure the payments under the LLHI Note, LLHI executed a mortgage in favor of Security Industrial on the parcels of real property on which seven of the funeral homes that LLHI purchased were located. The historical appraisals conducted in connection with the 1996 Security Industrial acquisition and more recent financial performance information indicate that Security Industrial's claim under the LLHI Note is substantially oversecured. As a Louisiana insurance corporation, Security Industrial is subject to the regulatory powers of the Louisiana Department of Insurance. In this regard, Security Industrial has advised the Debtors that it will be required to treat the LLHI Note as a nonperforming asset on its regulatory accounting statements if and when the LLHI Note becomes three months in arrears. This accounting treatment would reduce Security Industrial's income as reflected on its regulatory accounting statements, reduce its dividend-paying capacity, and the Department's imposition of limitations that would negatively affect its operations. The Debtors have concluded that, because the obligations under the LLHI Note are substantially oversecured and in light of the regulatory and financial matters governing Security Industrial, which is wholly owned by the Debtors, the resumption of payments under the LLHI Note is in the best interests of the Debtors' estates. In the circumstance, the Debtors ask Judge Walsh to approve a Stipulation and Order which provides: (1) nunc pro tunc approval of Past Payments made subsequent to the Petition Date and up to March 2000; (2) Catch-up Payments for April and May 2000; and (3) Future Payments in accordance with the schedule set forth in the LLHI Note. Pursuant to the Stipulation, Security Industrial will waive any right that it may have under the Loan Documents to interest or any late fees or charges. Judge Walsh approved the Stipulation in all respects. (Loewen Bankruptcy News Issue 24; Bankruptcy Creditors' Service Inc.) MARINER: Court Approves Agreement With SNH ------------------------------------------ Senior Housing Properties Trust (NYSE:SNH) announced that its agreements with Mariner Post-Acute Networks, Inc. (OTC:MPANE) and Integrated Health Services, Inc. (OTC:IHSV) were approved by the Bankruptcy Courts supervising the Chapter 11 proceedings by Mariner and Integrated. The Court approvals in the Mariner case was received on June 29, 2000, and in the Integrated case on July 7, 2000. A spokesman for SNH pointed out that the Bankruptcy Court's approvals are an important step in implementing the settlement agreements with Mariner and Integrated which were announced on March 22, 2000 and April 12, 2000, respectively. Full implementation of the settlement agreements is still contingent upon state licensing and other regulatory approvals for SNH subsidiaries to operate the facilities formerly leased by SNH to Mariner and Integrated. However, assuming that these licenses and approvals are forthcoming, the Bankruptcy Court's approvals provide that the settlements will be financially effective as of July 1, 2000. The previously announced settlement with Mariner provides as follows: -- The leases for 26 nursing homes (3,482 beds) between SNH, as lessor, and Mariner, as lessee are relinquished by Mariner. -- Approximately $24 million of cash and securities held by SNH to secure Mariner's lease obligations and related guarantees is retained by SNH. -- SNH will assume operations for its own account at 17 of these 26 properties. Title to five of these 26 properties is transferred to Mariner which will continue those operations. The remaining four nursing homes are now subleased to two private companies and SNH will negotiate with these subtenants for their continued operations of these properties. The previously announced settlement with Integrated provides as follows: -- SNH had leased or provided first mortgage financing to Integrated for 39 nursing homes. -- The lease for one nursing home in Pennsylvania (140 beds) is amended to provide a new ten-year term at $100,000 per month ($1.2 million per year) plus annual escalations. As amended, this lease has been assumed by Integrated as a priority expense in its bankruptcy effective January 1, 2000. -- SNH's mortgage investment secured by one nursing home in Louisiana (118 beds) is cancelled and Integrated will continue to own and operate that property. -- Integrated's lease and mortgage obligations to SNH for the remaining 37 nursing homes are relinquished by Integrated. -- In addition to rent for the Pennsylvania property described above, Integrated has paid SNH a total of approximately $3 million for its use and occupation of the SNH leased and mortgaged properties and other claims arising from the date of the Integrated bankruptcy filing on February 2, 2000 until June 30, 2000. -- As further compensation for the unpaid mortgage and rent Integrated will convey nine nursing homes (648 beds) to SNH. -- SNH will operate for its own account 41 proprieties with 3,901 beds including 33 of the 37 properties for which leases and mortgages are cancelled and eight of the nine properties received from Integrated. -- Leases for five properties formerly operated by Integrated have been assumed by HEALTHSOUTH (NYSE: HRC). David J. Hegarty, President of SNH, issued the following statement to accompany this announcement: "Senior Housing is pleased that the Bankruptcy Court has approved its settlement arrangements with Mariner and Integrated. We expect that licensing of SNH subsidiaries to operate these properties to take between 30 and 90 days depending upon the procedures in the different States in which these facilities are located. In the interim, now that the Court has approved these agreements we will begin to take a more active role in the management of operations at these properties and expect that the turnaround process will begin. Assuming that SNH affiliated entities are fully licensed, the term of our agreements with Mariner and Integrated provide that SNH will have the benefit of the properties' operating in lieu of rent effective July 1, 2000." Senior Housing Properties Trust is a real estate investment trust headquartered in Newton, MA which owns nursing homes and senior living properties located throughout the United States. MEDPARTNERS: Motion For Approval of Sale Procedures --------------------------------------------------- MedPartners Provider Network, debtor requests that the court enter an order scheduling a hearing on a motion for establishment of the sale procedures for authorization to sell and assign its real property interests in the properties commonly known as 5000 and 5001 Airport Plaza Drive, Long Beach, pursuant to an agreement between MPN and Pacifica Real Estate Group. Briefly, the agreement provides that, subject ot various terms and conditions the debtor will transfer the Properties to the Buyer, which transfer will include assumption and assignment of certain ground subleases; the sale of fee simple interests in the buildings and certain related real property owned by MPN, certain items of personal property related to the properties,; and certain other of MPN's interests , rights and obligations pertaining to the properties, in exchange for: Cash consideration of $9,200,000 and the Buyer's share of escrow fees, closing costs and prorations. A termination fee is provided, in the event that the Buyer is not the winning bidder, such amount to be determined, not less than $25,000 and not more than $50,000, depending on certain appraisal fees and expenses of the Buyer.. MONEYSWORTH & BEST: Files For Bankruptcy ---------------------------------------- From Toronto, Canada, Dow Jones reports on July 11, 2000 that Moneysworth & Best Shoe Care Inc., which makes shoe-care and foot-care products, announced that PricewaterhouseCoopers Inc. was appointed trustee in bankruptcy. In May, Moneysworth & Best attempted to restructure its payment obligations and was in talks to raise more working capital. PRESCIENT TECH: Spatial Acquires Prescient Tech for $1.4 Million ---------------------------------------------------------------- Spatial Inc.'s PlanetCAD unit announced yesterday that it acquired financially troubled Prescient Technologies Inc. in a cash and stock deal valued at about $1.4 million, according to a newswire report. In a press release Thursday, Spatial, a Boulder, Colo.-based Web technology company, said the acquisition of the software engineering company was an asset purchase, and the company will issue Prescient between 300,000 and 350,000 shares of Spatial stock and $100,000 cash. The deal was delayed for 45 days after Stone & Webster, Prescient's parent company, filed for bankruptcy. (ABI 14-July-00) PRIME SUCCESSIONS: Files Chapter 11 Petition and Plan ----------------------------------------------------- Prime Succession, Inc. (the "Company") today announced that it has reached an agreement with its secured bank lenders and a committee representing the holders of over two-thirds of its outstanding senior subordinated notes on a financial restructuring of the Company. The Company also announced that, in order to implement the restructuring, it has filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code together with a plan of reorganization that embodies the terms of the restructuring. Certain of the Company's subsidiaries and parent holding company, Prime Succession Holdings, Inc. ("Holdings") were also included in the Chapter 11 filing. Pursuant to the restructuring agreement, the Company will pay its trade creditors in full and convert its $100 million 10-3/4% Senior Subordinated Notes due 2004 and certain other unsecured claims into (i) new subordinated notes in the aggregate amount of $20 million, with interest paid-in-kind at 14.25% per annum (payable in cash under certain circumstances), and (ii) 100% of the outstanding common equity in reorganized Holdings as subject to dilution from a contemplated management incentive program and warrants to be issued to current equity holders. The plan also provides for the modification of certain terms and conditions relating to the company's $108.5 million of secured debt owed to its senior lenders. Significant among these modifications is the consolidation of all amounts owed into one extended term loan and the inclusion of a principal repayment schedule that is more consistent with the Company's projected future cash flows. Gary L. Wright, Prime's President and Chief Executive Officer, said. "We are extremely pleased to announce the agreement in principle with the bondholder committee and the bank lenders which will significantly reduce the Company's long term debt. The new capital structure along with the many operational improvements now in place will enable Prime Succession to set the standard in service quality and achieve our Vision of becoming the premier funeral home/cemetery operating company in North America." Mr. Wright emphasized that the restructuring will have no impact on the Company's ability to fulfill its commitments to customers and that there will be no interruption in operations at the Company's funeral homes and cemeteries. The Company will seek and expects to receive the Court's approval to continue payment of employee salaries, wages and benefits without interruption. Further, the Company will seek approval to implement a vendor program whereby vendors and holders of similar unsecured claims will be paid in full subject to certain agreed terms and conditions. To ensure liquidity throughout this period, Prime has received a commitment for up to $10 million of debtor-in-possession (DIP) financing from a group of some of its current senior lenders. This commitment of DIP financing, which is subject to court approval, is an indication of the bank group's continued support of the Company. The Company expects the DIP financing to be approved. Once approved, funds will then be available to the Company to assume fulfillment of future obligations associated with operating its business during the reorganization. On the basis of revenues, Prime Succession, Inc. is the fifth largest provider of funeral and cemetery products and services in the death care industry in the United States. Through its subsidiaries, the Company owns and operates approximately 140 funeral homes and 19 cemeteries in 19 states. SAFETY-KLEEN: Judge Denies Bankruptcy Transfer, Grants TRO ---------------------------------------------------------- A Delaware judge denied a motion filed by the Department of Health and Environmental Control, along with the state-owned utility Santee Cooper and the Natural Resources Department, to move the Safety-Kleen Corp. bankruptcy case from Delaware to South Carolina provided that other actions involving a Pinewood landfill facility are not transferred from South Carolina. Last Week, Safety-Kleen was granted a temporary restraining order by a Delaware judge preventing the state health department from closing the landfill, and allowing the company to keep taking in hazardous and industrial waste at the site near Lake Marion until a hearing scheduled this Aug. 15. SAFETY-KLEEN: Applies To Employ Arnold as Environmental Counsel --------------------------------------------------------------- The Debtors formally retained Arnold & Porter pursuant to an Engagement Letter dated as of April 5, 2000, for: (a) advice regarding the obligations of SKC under federal and state environmental laws and regulations, including the financial assurance requirements of applicable hazardous waste regulations; (b) advice concerning permit compliance; and (c) analysis of exposure to liability for contamination of soil or groundwater at specific sites. By this Application, the Debtors ask Judge Walsh for permission to continue Arnold & Porter's retention as their Special Environmental Counsel during these chapter 11 proceeding. Arnold & Porter's continued retention will be invaluable, Safety-Kleen says, as the Debtors seek to reorganize their operations and financial affairs. The A&P members and counsel presently expected to work on this matter, and their hourly rates, are: Michael Cerrard $485 Thomas H. Milch $465 Jeffrey S. Bromme $380 Elliot Zenick $210 Arnold & Porter received a $155,000 retainer prior to the Petition Date. Mr. Milch, a member of Arnold & Porter working in A&P's Washington, D.C., office, affirms that A&P represents no interest adverse to any of the Debtors' estates and employment is permissible under 11 U.S.C. Sec. 327(e) notwithstanding A&P's representation of scores of the Debtors' creditors in matters unrelated to Safety-Kleen. (Safety-Kleen Bankruptcy News Issue 4; Bankruptcy Creditors' Service Inc.) STONE & WEBSTER: Court Approval for Acquisition of Assets --------------------------------------------------------- The Shaw Group Inc. (NYSE:SGR) ("Shaw" or "the Company") announced on July 13, 2000 that it received court approval under Chapter 11 of the U.S. Bankruptcy Code for the acquisition of substantially all of the assets and the assumption of certain liabilities of Stone & Webster, Inc. ("S&W"). In a press release dated July 7, 2000, the Company stated that it was the successful bidder in an auction for the business of S&W, with a purchase price of approximately $38 million in cash and approximately 2.5 million shares of Shaw Common Stock. Further details will be provided upon closing, which is scheduled to becomplete by the close of business, Friday, July 14, 2000. The Shaw Group Inc. is the largest supplier of fabricated piping systems and services in the world, with unparalleled piping experience and expertise in the global power generation market. Shaw is also a leader in providing innovative solutions to the chemical and petrochemical processing, crude oil refining and oil and gas exploration and production industries. With over 7,500 employees worldwide, Shaw distinguishes itself by offering its customers comprehensive piping solutions consisting of integrated engineering and design, fabrication, erection and maintenance of piping systems and the manufacture of specialty pipe fittings and supports. The ability to provide comprehensive piping solutions enables the Company to be a cost-effective single-source provider of fabricated piping systems and services for projects around the world. The Company operates facilities in California, Louisiana, New Hampshire, New Jersey, Oklahoma, South Carolina, Texas, Utah, Virginia, Australia, the United Kingdom, Venezuela and Bahrain, where it has a 49% interest in a joint venture. Stone & Webster is a leading global provider of full-service, value-added engineering, procurement, construction, consultation and environmental services to the power, process, governmental and industrial markets. S&W is headquartered in Boston, Massachusetts and employs over 5,500 people at operations in the US and internationally. SUN HEALTHCARE: Appoints New Chairman and New CEO ------------------------------------------------- Sun Healthcare Group, Inc. (OTC: SHGE) announced that Andrew L. Turner, the company's chairman of the board and chief executive officer, intends to resign. The company also announced that James Tolbert, Sun's lead independent director, will become chairman of the board, and Mark Wimer, the company's president and chief operating officer, will become chief executive officer. Mr. Tolbert and Mr. Wimer are now serving as acting chairman and chief executive officer, respectively, until the bankruptcy court overseeing the company's chapter 11 case approves the termination of Mr. Turner's employment agreement, at which time the appointments will become permanent. Headquartered in Albuquerque, N.M., Sun Healthcare Group is a diversified international long-term care provider. Sun companies operate long-term and postacute care facilities in the United States, the United Kingdom, Spain, Germany and Australia. Sun subsidiaries provide therapy and pharmacy services, fulfill the medical supply needs of nursing homes, and offer a comprehensive array of ancillary services for the healthcare industry. SYBASE: Prospectus Relating to 7,381,917 Shares ----------------------------------------------- Sybase, Inc., consolidated with its subsidiaries, is one of the largest global independent software companies in the world. Two weeks ago it began distribution of a prospectus relating to the public resale of up to 7,381,917 shares of Sybase, Inc. common stock, par value $0.001, which the company has issued or may in the future issue to the former reselling stockholders and warrant holders of Home Financial Network, Inc., a Delaware corporation, in connection with Sybase's acquisition of Home Financial Network on January 20, 2000. All shares are being offered by the selling stockholders. The shares offered consist of 7,098,985 shares that Sybase issued in exchange for outstanding Home Financial Network common and preferred stock and 282,932 shares that are issuable upon any future exercise of the warrants issued by Sybase in exchange for outstanding Home Financial Network warrants in the acquisition. The selling stockholders have not advised of any specific plans for the distribution of the shares covered by the prospectus. Sybase advises that the reselling stockholders may offer the shares in one or more transactions at any price. Their offers and sales may be made on the Nasdaq National Market or in privately negotiated transactions. The selling stockholders may, or may not, effect their transactions by selling the shares to or through broker-dealers and broker-dealers may receive compensation in the form of discounts, concessions or commissions from the selling stockholders or the purchasers of the shares. Broker-dealers may act as agent, buy or sell as a principal, or both, and the broker-dealer's compensation in connection with the offer and sale of the shares might be more than customary commissions. THERMATRIX INC: First Quarter Results ------------------------------------- Thermatrix Inc. (OTC: TMXIQ) announced today results for the first quarter ended March 31, 2000. Revenues for the first quarter of fiscal year 2000 were $7.5 million compared to $5.8 million recorded in the comparable quarter of the prior year. The revenue figure for fiscal year 1999 has been restated to account for discontinued operations as a result of the appointment by Wexford Management LLC of an administrative receiver in the United Kingdom for all of the assets of the Company's U.K. subsidiaries. The Company recorded a net loss attributable to common stock for the quarter of $1.5 million or $0.19 per share compared to a net loss of $2.0 million or $ 0.25 per share for the comparable quarter in the prior year. However, $1.4 million of the net loss for the quarter was directly attributable to the cost of the Chapter 11 bankruptcy. "Although the bankruptcy case put a substantial strain on the Company during the first quarter, our focus on profitability rather than revenue growth began to show positive results," said Daniel S. Tedone, President and Chief Executive Officer. "Our progress is primarily due to the continuing commitment and enormous effort of our employees to whom I am especially grateful. In addition, The Dow Chemical Company's endorsement of the Company's FTO technology during the first quarter provided a foundation for recovery." Thermatrix is an industrial company primarily serving the global market of continuously operating facilities for a broad range of industries that include refining, chemical, steel, pharmaceutical, pulp and paper, electric utility, co-generation, and industrial manufacturing. Thermatrix provides a wide variety of air pollution control solutions, including its unique flameless thermal oxidation technology, as well as a wide range of engineered products and services to meet the needs of its clients. UNITED COMPANIES: Receives Approval for Disclosure Statements ------------------------------------------------------------- United Companies Financial Corporation (OTC:UCFNQ) announced that, in connection with the chapter 11 cases of United Companies and certain of its subsidiaries, which cases are pending in the U.S. Bankruptcy Court for the District of Delaware in Wilmington, the Bankruptcy Court approved the Debtors' Disclosure Statement; the Equity Committee's Disclosure Statement; and solicitation procedures and form of ballots in connection with the Debtors' Second Amended Plan of Reorganization and the Equity Committee's Second Amended Plan of Reorganization. The Debtors have retained an Information Agent to respond to inquiries regarding the Debtors' Plan, the Debtors' Disclosure Statement, the Equity Committee's Plan, the Equity Committee's Disclosure Statement and the submission of ballots. The Information Agent can be reached at 888/559-9367. For voting purposes and mailing of notices, June 30, 2000 shall be the Record Holder Date for the holders of claims and interests. The voting deadline is 4:00 PM Eastern time on August 10, 2000. A hearing to consider confirmation of the respective plans of reorganization is scheduled to commence on August 15, 2000 at 9:30 AM. The Debtors' Plan is based upon its previously announced sale of its whole loan portfolio and residual and other interests and servicing rights to EMC Mortgage Corp. The Equity Committee's Plan is based upon a continuation of the servicing of United Companies' loan portfolios through the engagement of a sub- servicer. Both the Debtors and the Equity Committee have reserved their rights to amend their respective proposed plans of reorganization. On May 30, the Company announced that it and certain subsidiaries signed an Asset Purchase Agreement and a Mortgage Loan and REO Property Purchase Agreement for the sale of substantially all of its whole loan portfolio and REO properties, assets related to its mortgage servicing operations and its interest only and residual interests as of December 31, 1999, to EMC Mortgage Corporation and EMC Mortgage Acquisition Corp., subsidiaries of The Bear Stearns Companies, Inc., for an aggregate cash purchase price of approximately$781 million, subject to adjustments, plus the assumption of certain liabilities. United Companies' cash on hand and certain other assets are not included in the sale. The sales are subject to the approval of the United States Bankruptcy Court and the submission of higher or better offers pursuant to bidding procedures approved by the Bankruptcy Court, as well as the satisfaction of certain other conditions. Under the bidding procedures previously approved by the Bankruptcy Court, interested parties have an opportunity to submit separate bids on (1) the Company's whole loan portfolio and REO properties and (2) the Company's mortgage servicing operations and interest only and residual interests prior to the respective sale hearings. The Company continues to provide due diligence to several parties interested in purchasing the whole loan portfolio, the residual loan portfolio, or both. United Companies Financial Corporation is a specialty finance company that historically provided consumer loan products nationwide and currently provides loan services through its lending subsidiary, UC Lending(R). The Company filed for chapter 11 on March 1, 1999. UNITED KENO: Extended Protection From Creditors ----------------------------------------------- United Keno Mines Limited announced on July 14, 2000 that the Superior Court of Ontario has extended the protection from its creditors granted to United Keno pursuant to an Order made in Toronto under the Companies' Creditors' Arrangement Act on February 18, 2000. Under the Order made on Wednesday, July 12, 2000 protection from proceedings against United Keno has been extended to August 31, 2000. Under Wednesday's Order, United Keno has been given until August 25, 2000 to call meetings of its creditors to implement the Plan of Arrangement that it filed with the Court on July 7, 2000. ********* 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 * * *