TCR_Public/960618.MBX BANKRUPTCY CREDITORS' SERVICE, INC.


Bankruptcy News For: June 18, 1996



  1. BEST PRODUCTS REPORTS FIRST-QUARTER RESULTS
  2. EAGLE-PICHER INDUSTRIES ANNOUNCES SECOND QUARTER RESULTS
  3. Shoney's, Inc. announces second quarter earnings per share of $.15





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BEST PRODUCTS REPORTS FIRST-QUARTER RESULTS; COMPANY REDEFINING STRATEGIC INITIATIVES


        


RICHMOND, Va. -- June 18, 1996 -- Best Products Co.
        Inc. (Nasdaq: BEST) today reported its 1996 first quarter net sales
        and operating results.  
        


            The company also said that following the arrival of a new chief
        executive officer in late April, it has begun to redefine its
        strategic initiatives for repositioning the company.  
        


            First quarter net sales for the 13 weeks ended May 4, 1996,
        decreased 1.1% to $269.8 million compared to $272.8 million for the
        same period the prior year.  Comparable store net sales decreased
        6.4% for the first quarter of 1996.  The company reported a net loss
        of $1.11 a share for the first quarter of 1996 compared to a net
        loss of $.25 a share for the same period in 1995.  
        


            Gross margin during the first quarter of 1996 was $58.2 million
        compared to $66.6 million for the same period in the prior year.
        First-quarter selling, general and administrative ("SG&A") expenses
        were $79.8 million this year compared to $72.2 million in 1995 due
        to higher payroll and occupancy expenses resulting from the opening
        of 15 stores in 1995, primarily during the last several months of
        the year.  
        


            The company stated that it is taking steps to reduce expenses by
        approximately $40 million on an annual basis, but these actions will
        not begin to be reflected in operating performance until the second
        half of fiscal 1996.  The company also indicated that the exiting of
        certain merchandise categories and an increase in the mix of
        promotionally priced sales are expected to result in lower margin
        dollars, compared to fiscal 1995, through at least the second
        quarter of fiscal 1996.  As a result, the company anticipates its
        operating performance will produce financial results in the second
        quarter of fiscal 1996 similar to those of the first quarter.  
        


            New Chairman and Chief Executive Officer Daniel H. Levy said,
        "The factors that contributed to the company's poor performance in
        the fourth quarter of 1995 -- poor planning and weak marketing,
        resulting in sales, margin rate and margin dollar shortfalls
        -- continued to impact Best Products' performance during the first
        quarter of 1996.  While we are addressing these issues, we
        anticipate they will continue to affect results in the near term.  
        


            "Best Products' business objectives this year are to continue to
        reduce expenses, to increase margin dollars and to stabilize our
        sales performance.  We also believe it is paramount that the company
        transition to a non-catalog showroom form of retailing, and as
        announced earlier this year, we will be making significant changes
        to our outdated shopping process this fall.  Best Products also has
        decided not to launch a broadcast advertising campaign in 1996.
        Instead, we believe the most effective way to communicate with our
        customers at this time is through the substantially stronger and
        more aggressive print marketing program we will implement this
        fall."  
        


            The company said it is progressing with the implementation of
        many of the strategic initiatives it announced earlier this year.
        Best Products has eliminated its annual fall catalog in favor of a
        significantly strengthened and more contemporary-looking print
        marketing program for the fall.  The shopping experience at Best
        stores will become more customer friendly with the installation of a
        simplified shopping and payment process -- including more self-
        service merchandise -- that replaces the current, out-dated
        merchandise-order process.  
        


            Through the fall Best Products will be exiting categories such
        as bicycles, home office electronics, video games, film processing,
        automotive electronics, some sporting goods and selected toys,
        calculators and music items.  The company anticipates replacing the
        margin dollars contributed by those exit categories by adding basic
        domestics such as pillows and pads, as well as enhancing and
        emphasizing certain ongoing merchandise categories.  
       


            Levy said, "Best Products has already taken significant steps to
        reduce expenses, increase its margin rate and refine its merchandise
        assortments.  We believe these measures, along with the enhancements
        to the shopping process, better execution at the store level and a
        stronger marketing program, will allow us to improve operating
        earnings in 1996 and set the stage for continued improvement during
        1997."  
        


            This release contains forward-looking statements that are
        subject to risks and uncertainties, including but not limited to
        risks associated with the repositioning of the company, its
        strategic initiatives, and customer and vendor support for such
        changes.  Additional discussions of factors that could cause actual
        results to differ materially from management's projections,
        forecasts, estimates, anticipations and expectations is contained in
        the company's Securities and Exchange Commission filings.  
        


            Best Products, a specialty retailer offering category-dominant
        assortments of jewelry and home furnishings, operates 169 Best
        stores in 23 states.


        
                             BEST PRODUCTS CO. INC.
                            STATEMENTS OF OPERATIONS

                                             (Unaudited)
              (Dollar amounts in thousands, except per-share amounts)      
        
                                           Thirteen weeks ended            
                                          May 4,        April 29,
                                          1996            1995
              
                                    
        Net sales                        $    269,791    $    272,759  
        Cost of goods sold                    211,610         206,167
                                    
          Gross margin                         58,181          66,592  
                                    
         Selling, general and
          administrative expenses              79,777          72,212  
         Depreciation and amortization          5,503           3,618
         Interest expense, net                  7,546           4,194
                                    
          Loss before income tax benefit      (34,645)        (13,432)
                                    
        Income tax benefit                         --           5,373  
                                    
          Net loss                       $    (34,645)   $     (8,059)
                                    
                                    
        Net loss per common share        $      (1.11)   $      (0.25)
                                    
        Weighted average common
          shares outstanding               31,342,108      31,660,711
        
                                 BALANCE SHEETS
        
                                              May 4,         Feb. 3,
                                               1996           1996
                                          (Dollar amounts in thousands)
        
                                            (Unaudited)
         
        ASSETS
        Current assets:
          Cash and cash equivalents              $    9,607    $   29,003
          Merchandise inventories                   476,937       481,847
          Other current assets                       25,628        19,796
        Total current assets                    512,172       530,646
         
        Property and equipment, net                 174,827       173,239
        Other assets, net                            10,141        12,755
         Total Assets                        $  697,140    $  716,640
         
        Liabilities and Stockholders' Equity
        Current liabilities:
          Short-term borrowings                  $   47,926    $       --
          Current maturities of long-term debt
        and capital lease obligations            22,714        20,895
          Accounts payable                          107,375       128,834
          Accrued  expenses and other                44,349        44,426
          Accrued insurance                          12,105        10,870
          Accrued  restructuring charges             26,633        28,400
         Total current liabilities              261,102       233,425
         
        Long-term debt                              120,206       129,833
        Capital lease obligations                    80,518        83,312
        Other liabilities                            14,885        14,996
         Total Liabilities                      476,711       461,566
         
        Stockholders' Equity
        Common stock                                 31,342        31,345
        Additional paid-in capital                  297,646       297,643
        Retained earnings (accumulated deficit)    (105,219)      (70,574)
                                                223,769       258,414
        Loans under Stock Purchase Loan Plan         (3,340)       (3,340)
         Total Stockholders' Equity             220,429       255,074
         
         Total Liabilities and
          Stockholders'                      $  697,140    $  716,640
        

CONTACT:  IR    -- Frederick Kraegel, 804/261-2150
                  MEDIA -- Ross Richardson, 804/261-2157


EAGLE-PICHER INDUSTRIES ANNOUNCES SECOND QUARTER RESULTS


        


            CINCINNATI, June 18, 1996 - Eagle-Picher Industries (OTC:
        EPIHQ.U) today announced that sales for the second quarter ended May
        31, 1996 were $235.1 million compared with $225.4 million for the
        second quarter of 1995.  Operating income for the period was $19.3
        million compared with $19.1 million for the same period last year.
        Net income for the second quarter of 1996 was $16.8 million or $1.52
        per share which was equal to the $16.8 million or $1.52 per share
        for the second quarter of 1995.  At the end of the second quarter of
        1996, the Company's cash position was $109.7 million.  This compares
        with a cash position of $93.3 million at the end of the fiscal year
        and $96.8 million at the end of the second quarter of 1995.
        


            Thomas E. Petry, Eagle-Picher Chairman, said that, "sales for
        the Automotive Group for the second quarter of 1996 were ahead of
        the levels of the second quarter of 1995 while operating income was
        essentially the same as that of the second quarter of 1995.  The
        results for the second quarter of 1996 contrast sharply with those
        of the first quarter of 1996 when the low level of automotive
        production, inclement weather, and customer delays in new program
        start-ups caused sales and operating income to be well below the
        levels of the first quarter of 1995. Despite a strike at the General
        Motor's Delphi Division, an important customer, increased production
        levels in the North American market and a favorable product mix were
        important factors in the improving trend during the second quarter
        of 1996.  European operations did well during the second quarter as
        these operations continue to increase market share.  Start-up costs
        associated with expansions and continued delays by one customer in
        meeting anticipated production schedules placed pressure on profit
        margins during the quarter.
        


            "Sales for the Machinery Group were essentially equal to those
        of the second quarter of last year while operating income declined.
        The primary reason for the decline in operating income was reduced
        shipments of earth moving machinery by the Construction Equipment
        Division.  Shipments of special purpose batteries by the Eagle-
        Picher Technologies Division (formerly the Electronics Division
        which was merged with the Specialty Materials Division to form Eagle-
        Picher Technologies) were strong.  The Division is the largest
        international supplier of power systems for commercial, military,
        and weather satellites in the world.  Results for the remaining
        operations in the Machinery Group were mixed.
        


            "Sales and operating income for the Industrial Group increased
        in the second quarter of 1996 over the results for last year's
        second quarter.  Shipments of diatomaceous earth products, both to
        the domestic and to the international markets, were at a high level.
        Diatomaceous earth products are used for high purity filtration in
        the food and beverage industry and in a variety of general
        industrial applications. Eagle-Picher Technologies' operations in
        the Industrial Group enjoyed an outstanding quarter.  These
        operations produce germanium substrates for solar cells which are
        used on commercial, weather, and military satellites.  Shipments of
        boron isotopic compounds were also at a high level.  Recent
        penetration of the European nuclear market has provided an excellent
        growth opportunity for boron products.
        


            "As reported previously, on April 9, 1996, the Company and its
        affiliated chapter 11 debtors filed a First Amended Consolidated
        Plan of Reorganization under Chapter 11 (the "Plan") and a proposed
        First Amended Joint Disclosure Statement pursuant to Section 1125 of
        the Bankruptcy Code (the "Disclosure Statement").  A hearing to
        consider approval of the Disclosure Statement has been tentatively
        scheduled for July 1996 before the Bankruptcy Court.  Pursuant to
        the Bankruptcy Code, the acceptance or rejection of a plan of
        reorganization may not be solicited from the holder of a claim
        unless at the time of or before such solicitation there is
        transmitted to such holder the plan or a summary of the plan and a
        disclosure statement approved by the Bankruptcy Court as containing
        information of a kind and in sufficient detail that would enable a
        hypothetical reasonable investor typical of holders of claims to
        make an informed judgment about the plan.  In addition, in June,
        1996, the United States District Court for the Southern District of
        Ohio, Western Division, heard oral arguments on the appeals filed
        with respect to the Bankruptcy Court's order dated December 4, 1995,
        as amended, which estimated the Company's aggregate liability on
        account of present and future asbestos-related personal injury
        claims to be approximately $2.5 billion.  The appeals were filed by
        the Unsecured Creditors' Committee ("UCC"), the Equity Security
        Holders' Committee, and independently by two members of the UCC.  A
        decision is pending by the U.S. District Court.
        


            "Decisions with respect to the above matters will have a direct
        impact on the plan of reorganization process.  Accordingly, at this
        time, it is not possible to predict when a plan of reorganization
        will be confirmed and become effective.
        


            "It is expected that economic activity will be at a reasonably
        high level during the second half of 1996.  Several operations are
        serving growing markets and/or are increasing market share, while
        others are serving sluggish segments of the economy.  On balance,
        and based on forecasts from the Company's Divisions, results for the
        second half of 1996 could approximate those of the second half of
        1995."
        




        The figures follow:
        (Data in thousands except per share)
        
        Three Months Ended May 31               1996           1995
        
        Net sales                             $235,126       $225,378
        Operating income                        19,281         19,147
        Other non-operating items                 (432)          (479)
        Reorganization items                        22           (331)
        Income before taxes                     18,871         18,337
        Net income                              16,756         16,776
        Net income per share                      1.52           1.52
            Average shares                      11,041         11,041
        
        Six Months Ended May 31                 1996           1995
        
        Net sales                             $443,708       $422,981
        Operating income                        32,652         34,260
        Other non-operating items                 (592)          (581)
        Reorganization items                        90           (756)
        Income before taxes                     32,150         32,923
        Net income                              28,264         29,808
        Net income per share                      2.56           2.70
            Average shares                      11,041         11,041


CONTACT:  J. Rodman Nall of Eagle-Picher Industries, 513-721-7010


Shoney's, Inc. announces second quarter earnings per share of $.15


        


NASHVILLE, Tenn. -- June 18, 1996 -- Shoney's, Inc.
        today reported results for the second quarter of fiscal 1996 with
        revenue for the 12-week period of $257.7 million, up 2% from $253.2
        million in the second quarter of fiscal 1995.  Comparable restaurant
        sales for the second quarter of 1996 were up 1.0%, including a menu
        price increase of 1.6%.  Comparable restaurant sales for the
        Company's Shoney's Restaurants were down 1.0%, while the Company's
        Captain D's restaurants had a comparable restaurant sales increase
        of 6.4%.  Income from continuing operations for the second quarter
        was $6.4 million, or $.15 per share on a primary basis, compared to
        $6.2 million, or $.15 per share, in the prior year.  
        


            C. Stephen Lynn, chairman of the board and chief executive
        officer, said, "I am pleased with the progress in our turnaround.  I
        am confident we have the right team and the right programs in place
        to build long term shareholder value.  We have continued to focus on
        restoring operational execution and returning the art of hospitality
        to our Shoney's Restaurants.  The increase in customer compliments
        and decline in customer complaints are tangible examples that our
        plan is working.  But we have much yet to do."
        


            Lynn said, "I am excited by the continued excellent performance
        of our Captain D's restaurants.  The increase in comparable
        restaurant sales of 6.4% represents an outstanding performance in
        all areas of the concept -- from operations to marketing, training,
        remodels and new products."  Lynn also noted, "The new leadership of
        our casual dining group continues to make progress which was
        reflected by slight improvements in store level performance during
        the quarter."
        


            Revenues for the first two quarters of fiscal 1996, a 28-week
        period, were $557.9 million, down 1%.  Comparable restaurant sales
        for the first two quarters of fiscal 1996 were down 0.5%, which
        included a menu price increase of 1.5%.  Net income for the first
        two quarters was $30.5 million, or $.70 per share on a fully diluted
        basis.  Results for the first two quarters include a gain of $22.1
        million, net of taxes, on the sale of Mike Rose Foods, Inc. which
        was consummated in the first quarter.  This sale completed the
        divestitures announced in January 1995 as part of the Company's
        restructuring plan.  Income from continuing operations in the first
        two quarters of 1996 was $8.1 million, or $.19 per share on a
        primary basis, compared to $14.2 million, or $.34 per share, in the
        prior year.
        


            Lynn continued, "I am expecting a late summer closing of the
        acquisition of TPI Restaurants.  While the closing of the
        transaction has been delayed from the original plan, it is expected
        to be completed within the next two months.  The Company has
        received lender approval and has arranged the necessary financing to
        complete the transaction.  As soon as the Company's registration
        statement and joint proxy is approved by the Securities and Exchange
        Commission, a shareholder meeting will be held as soon as
        practicable and one transaction will be completed."
        


            The Company opened 30 restaurants in the first half of 1996,
        including 25 Shoney's Restaurants, two Captain D's, two Pargo's and
        One BarbWire's.  The Company acquired 15 of the 25 Shoney's
        Restaurants and both Pargo's opened in the first two quarters from
        franchisees.  Franchisees opened five restaurants in the first two
        quarters of 1996, resulting in a net decrease of 43 franchised
        restaurants.  The Company expects to open or acquire 31 restaurants
        during the 1996 fiscal year, including 26 Shoney's Restaurants.  At
        the end of the quarter, the Company had a total of 1,507 restaurants
        in 34 states, including 724 company-owned and 783 franchised
        restaurants.
        


            The Company's common stock is traded on the New York Stock
        Exchange under the symbol "SHN."


        
                       Shoney's, Inc. and Subsidiaries
                          Consolidated Balance Sheet
       
        
                           May 12,                   Oct. 29
        Assets                  1996          %            1995         %
        Current assets
        Cash and cash
         equivalents       $  5,820,242      1.1       $  7,513,588     1.4
        Notes and accounts
         receivable          12,395,131      2.3         13,013,821     2.4
        Inventories          34,005,375      6.2         33,483,964     6.3
        Deferred taxes and                                            
         other current
         assets              34,030,680      6.2         30,716,885     5.8
        Net current assets
         of discontinued
         operations                   0                  14,495,812     2.7
        Total current
         assets              86,251,428     15.8         99,224,070    18.6
        
        Property, plant and equipment
        Land                122,701,557     22.4        117,104,203    21.9
        Buildings           242,850,055     44.4        227,124,559    42.5
        Restaurant and
         other equipment    271,219,262     49.6        256,936,595    48.0
        Leasehold
         improvements        57,230,997     10.5         57,330,822    10.7
        Rental properties    24,679,070      4.5         24,136,182     4.5
        Buildings under
         capital leases      19,744,107      3.6         18,122,394     3.4
        Construction in
         progress            7,797,346       1.4          9,789,522     1.8
                       -----------      ----        -----------   -----
                       746,222,394     136.4        710,544,277   132.8
        Less accumulated
         depreciation and
         amortization     (306,819,543)    (56.1)      (291,057,795)  (54.4)
        Net property, plant
         and equipment     439,402,851      80.3        419,486,482    78.4
        
        Other assets
        Deferred charges and
         other intangible
         assets             13,590,635       2.5          7,085,784     1.3
        Other                7,847,915       1.4          9,219,658     1.7
        Total other assets  21,438,550       3.9         16,305,442     3.0
                       -----------     -----        -----------    ----
                      $547,092,829     100.0       $535,015,994   100.0
        
        Liabilities and Shareholders'
         Equity (Deficit)
        Current liabilities
        Accounts payable  $ 31,012,233       5.7       $ 33,099,813     6.2
        Federal and state
         income taxes        6,306,108       1.2          7,486,210     1.4
        Accrued expenses    74,609,667      13.6         74,312,652    13.9
        Reserve for litigation
         settlement         23,154,539       4.2         23,372,889     4.4
        Debt and capital
         less obligations   
         due within
         one year           43,802,293       8.0         34,448,154     6.4
        Total current
         liabilities       178,884,840      32.7        172,719,718    32.3
        
        Long-term debt
         and capital lease
         obligations due
         after one year    384,853,003      70.3        406,032,446    75.9
        Reserve for litigation
         settlement         27,385,434       5.0         38,727,434     7.2
        Deferred income
         taxes              23,120,797       4.2         19,223,797     3.6
        Deferred income and
         other liabilities   6,523,887       1.2          6,619,234     1.2
        
        Shareholders' Equity (Deficit)
        Common stock        41,650,573       7.6         41,510,659     7.8
        Additional paid-in
         capital            61,895,691      11.3         60,770,176    11.4
        Retained earnings
         (deficit)        (180,054,706)    (32.8)      (210,587,470)  (39.4)
        Unrealized gain on
         securities available
         for sale            2,833,310       0.5                  0    
        Total shareholders'
         equity (deficit)  (73,675,132)    (13.4)      (108,306,635)  (20.2)
                       ------------    ------      -------------  ------
                       $547,092,829    100.0       $535,015,994   100.0
        
                       Consolidated Statement of Income
                  Twelve Weeks Ended May 12, 1996 and May 14, 1995
        
                           1996                         1995         
                          Amount         %             Amount         %
        Revenues
        Net sales          $251,372,788     97.5       $248,151,606    98.0
        Franchise fees        5,445,261      2.1          5,721,458     2.3
        Other income            893,710      0.4           (678,347)   (0.3)
                       ------------    -----       ------------    -----
                        257,711,759    100.0        253,194,717    100.0
        Costs and Expenses
        Cost of sales   
        Food and supplies   104,816,833      40.7       104,889,933     41.4
        Restaurant labor     62,166,825      24.1        58,771,718     23.2
        Operating expenses   55,229,883      21.4        53,996,082     21.4
                       ------------    ------       -----------    -----
                        222,213,541      86.2       217,657,733     86.0
        General and
         administrative      16,381,048       6.4        14,958,418      5.9
        Interest expense      8,147,363       3.1         9,433,835      3.7
        Restructuring
         expenses                                         1,141,548      0.5
                       ------------    ------       -----------    -----
                        246,741,952      95.7       243,191,534     96.1
        Income from continuing
         operations before
         income taxes        10,969,807       4.3        10,003,183      3.9
        Provision for
         income taxes         4,544,000       1.8         3,801,000      1.5
        Income from continuing
         operations           6,425,807       2.5         6,202,183      2.4
        Discontinued operations,
         net of income tax                                2,291,419      0.9
        Net income         $  6,425,807       2.5      $  8,493,602      3.3
        
        Earnings per common share
        Primary:
         Income from continuing
          operations              $0.15                       $0.15
         Discontinued operations                               0.06
         Net income               $0.15                       $0.20
        
        Fully diluted:
         Income from continuing
          operations              $0.15                       $0.15
         Discontinued operations                               0.06
         Net income               $0.15                       $0.20
        
        Weighted average shares
         outstanding   
        Primary              41,725,679                  41,521,552
        Fully diluted        41,725,679                  41,521,552
        
                        Consolidated Statement of Income
            Twenty-eight Weeks Ended May 12, 1996 and May 14, 1995
          
                           1996                         1995         
                          Amount         %             Amount         %
        
        Revenues
        Net sales          $544,155,710     97.5       $549,821,737    97.6
        Franchise fees       11,755,188      2.1         12,853,920     2.3
        Other income          1,977,954      0.4            904,066     0.1
        
                       ------------    -----       ------------    -----
                        557,888,852    100.0        563,579,723    100.0
        Costs and Expenses
        Cost of sales   
        Food and supplies   227,695,168      40.8       232,630,043     41.3
        Restaurant labor    137,786,452      24.7       130,726,667     23.2
        Operating expenses  123,200,000      22.1       120,847,154     21.4
                       ------------    ------       -----------    -----
                        488,681,620      87.6       484,203,864     86.9
        General and
         administrative      36,520,442       6.5        33,149,327      5.9
        Interest expense     18,965,217       3.4        21,600,374      3.8
        Restructuring
         expenses                                         1,699,873      0.3
                       ------------    ------       -----------    -----
                        544,167,279      97.5       540,653,438     95.9
        Income from continuing
         operations before
         income taxes        13,721,573       2.5        22,926,285      4.1
        Provision for
         income taxes         5,667,000       1.0         8,712,000      1.5
        Income from continuing
         operations           8,054,573       1.5        14,214,285      2.6
        Discontinued operations,
         net of income tax      397,816       0.1         4,942,907      0.8
        Gain on sale of discontinued
         operations, net of income
         tax                 22,080,375       3.9
        Net income        $  30,532,764       5.5       $ 19,157,192     3.4
        
        Earnings per common share
        Primary:
         Income from continuing
          operations              $0.19                       $0.34
         Discontinued operations   0.01                        0.12
         Gain on sale of
          discontinued operations  0.53                
         Net income               $0.73                       $0.46
        
        Fully diluted:
         Income from continuing
          operations              $0.22                       $0.34
         Discontinued operations   0.01                        0.12
         Gain on sale of
          discontinued operations  0.47  
         Net income               $0.70                       $0.46
        
        Weighted average shares
         outstanding   
        Primary              41,673,605                  41,447,375
        Fully diluted        46,895,656                  41,447,375
        
                       
                      Consolidated Statement of Cash Flow
                 
                                     Twenty-eight Weeks Ended
                                      May 12,         May 14,
                                       1996            1995
        Operating activities
        Net income                      $ 30,532,764   $ 19,157,192
        Adjustments to reconcile net
         income to net cash provided by
         operating activities:  
        Income from discontinued
         operations, net of taxes           (397,816)    (4,942,907)
        Gain on sale of discontinued
         operations, net of taxes        (22,080,375)                
        Depreciation and amortization     23,587,514     23,322,279
        Amortization and deferred
         charges and other non-cash
         charges                           5,922,129      3,914,231
        Realized and unrealized loss
         on marketable securities and
         sale of other assets                             1,491,837
        Change in deferred income taxes    3,897,000      2,348,000
        Changes in operating assets and
         liabilities                     (14,394,348)     8,134,778
        Net cash provided by continuing
         operating activities             27,066,868     53,425,410
        Net cash (used by) provided by
         discontinued operating
         activities                         (655,622)     6,313,090
        Net cash provided by operating
         activities                       26,411,246     59,738,500
        Investing activities
        Cash required for property, plant
         and equipment                   (47,154,734)   (37,399,057)
        Cash required for assets held
         for sale                                          (859,969)
        Proceeds from disposal of
         property, plant and equipment     4,128,630      2,924,131
        Proceeds from disposal of
         discontinued operations          51,279,601
        Cash required for other assets    (5,012,751)      (569,920)
        Net cash provided (used by)
         investing activities              3,240,746    (35,904,815)
        Financing activities
        Payments on long-term debt
         and capital lease obligations   (72,060,630)   (94,610,725)
        Proceeds from long-term debt      47,000,000     78,000,000
        Net proceeds from short-term
         borrowings                        7,607,000      4,918,000
        Payments on litigation
         settlement                      (11,560,350)   (11,692,420)
        Cash required for debt
         issue costs                      (2,753,171)    (1,005,342)
        Proceeds from exercise of
         employee stock options              421,813      1,355,364
        Net cash used by financing
         activities                      (31,345,338)   (23,035,123)
        Change in cash                  $ (1,693,346)  $    798,562
        

        CONTACT:  Shoney's, Inc., Nashville
                  W. Craig Barber, 615/391-5201