TCR_Public/960710.MBX BANKRUPTCY CREDITORS' SERVICE, INC.


Bankruptcy News For:  July 10, 1996



  1. HAMBURGER HAMLET RESTAURANTS INC. FILES PLAN OF REORGANIZATION
  2. Brio Industries announces year end & first quarter results
  3. HOUSE OF FABRICS PLAN OF REORGANIZATION CONFIRMED





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HAMBURGER HAMLET RESTAURANTS INC. FILES PLAN OF REORGANIZATION


        


            SHERMAN OAKS, Calif., July 10, 1996  --  Hamburger Hamlet
        Restaurants Inc.
and its 41 affiliated entities ("HHR") announced
        that HHR filed a joint plan of reorganization ("Plan") on July 8,
        1996 in the bankruptcy court having jurisdiction over HHR's Chapter
        11 cases.
        


            The Plan is based on a transaction proposal received by HHR from
        Grill Concepts, Inc., the owner of the Daily Grill restaurants and
        the Grill restaurant in Beverly Hills.  Under the proposed
        transaction, a subsidiary of Grill Concepts, Inc. ("Purchaser"),
        would purchase certain operating assets of HHR in exchange for cash,
        notes, the assumption of certain obligations and additional
        consideration as may be agreed upon by Purchaser and Banque Paribas,
        HHR's principal lender.  HHR and Purchaser have not yet executed
        binding agreements with respect to the proposed transaction and
        various negotiations are continuing.
        


            Under the Plan, the assets of HHR which are not sold to
        Purchaser plus the amounts to be paid by the Purchaser will be
        distributed to pay the costs of HHR's Chapter 11 cases and the
        claims of its creditors. The equity interests in HHR held by
        stockholders would be canceled and stockholders would not receive
        any property in respect of their stock.
        


            The consummation of the proposed transaction is contingent upon
        the execution of definitive agreements, the satisfactory completion
        of Purchaser's due diligence, the obtaining of the necessary
        financing and the confirmation of the Plan by the bankruptcy court.
        


CONTACT: Jack Lavine of Hamburger Hamlet, 818-995-7333/



Brio Industries announces year end & first quarter results


        


            VANCOUVER, British Columbia -- July 10,
        1996 -- Brio Industries Inc. (NASDAQ: BRIOF), announced today its
        results for its fiscal year ended Feb. 29, 1996 and its first
        quarter ended May 31, 1996.
        


            For the fiscal year ended Feb. 29, 1996 the company and its
        subsidiaries reported a net loss of $10,828,171(a) or $2.15 per
        share on sales of $46,647,000 versus a net loss of $4,688,000 or
        $1.03 on sales of $36,145,000 during fiscal 1995.  The results for
        fiscal 1996 included writedowns of approximately $8,000,000 to the
        capital assets of the company, and restructuring costs of more than
        $1,000,000 associated with the change in management and focus of
        Brio.  These adjustments which were equal to $1.59 per share reflect
        an effort by present management to be more conservative in matters
        of asset valuation and operational forecasts.  (Brio's new
        management took responsibility in March, 1996).  The benefit over
        time of these write-downs is a substantial saving of depreciation
        and amortization.
        


            For the quarter ended May 31, 1996, Brio reported a net loss of
        $462,000 or $.08 on sales of $13,700,000 versus net income of
        $380,000 or $.06 on sales of $12,147,000 in the same quarter a year
        earlier.
        


            In its announcement the company said that Brio's financial
        results over the past three years can best be put in perspective by
        reference to the plant capacity that Brio has either purchased or
        developed.  At the end of fiscal 1994, Brio's plants had the
        capacity to produce approximately 12.2 million cases of water,
        juices and carbonated soft drinks.  By the end of fiscal 1995, that
        capacity had risen to almost 22 million cases, and by this last
        fiscal year, to more than 35 million cases, generated by four modern
        facilities.
        


            During the course of bringing these plants on-line, the company
        encountered substantial commissioning costs which were, to a great
        extent, capitalized by former management as part of the value of
        those assets.  The company has adopted a more conservative practice,
        which results in the expensing more of these commissioning and
        related expenses.  In addition, 1995 and 1996 saw the company start
        to build the volumes and customer base necessary to see those plants
        run profitably.  In order to do so, former management saw the need
        to add the administrative and operational infrastructure to
        accommodate those anticipated volumes.  Although fiscal 1996 saw an
        almost 30% increase in revenues by the company, throughout fiscal
        1996 the company's plants operated at only about 29% of actual
        capacity.  That level of volume was simply insufficient for
        profitable performance given the operational and administrative
        overhead that the company had built.
        


            Commenting on the recent developments at the company, Robert
        Hunt, Brio's president and CEO said, "When we took over management
        of Brio Industries Inc., in March, the first quarter of our 1997
        fiscal year was already well underway.  Immediately upon our arrival
        we were faced with several important issues that required resolution
        and at the same time worked to set the stage for the future growth
        and development of the company.  The following summarizes several of
        the significant matters we have addressed.
        


        Financing:
        


            "The company's second financial quarter is our busiest.  More
        than 40% of our annual sales fall in that period.  This places heavy
        demands upon the company's working capital.  In order to accommodate
        our generally increasing sales levels and the summer inventory build
        up, we set about raising approximately $1,400,000(a) by way of
        issuance of share capital and have been arranging increases of our
        term loan facilities to replenish working capital committed in prior
        years to constructing our plants"  
        


        Cost Reductions:
        


            "In our view, the level of infrastructure and resultant general
        and administrative expenses that the company had encountered over
        the previous year were simply too high.  We are pleased to inform
        you that in the first quarter of this year we have been able to
        reduce those costs by approximately $550,000, on an annualized
        basis, without negatively impacting the performance levels of our
        division."
        


        Management Information Systems:
        


            "In order for us to properly monitor our operations and timely
        respond to our customers' needs, the company requires a
        sophisticated management information system that can better track
        production efficiencies, yield rates, waste levels, inventory
        management and other performance items.  We are in the process of
        developing and implementing such a system and anticipate that much
        of it will be working before the end of next quarter."
        


        Personnel Changes:
        


            "In addition to the changes within the board of directors and
        executive management of the company, it was necessary for us to
        bolster certain operational positions.  Most notably, we have
        appointed a new plant manager and quality control supervisor in our
        Vancouver plant."
        


        Teams:
        


            "We have created working teams in purchasing, quality control
        and maintenance to enable the entire company to take advantage of
        its considerable buying power and to share efficiencies and better
        practices.  We have already seen promising results from the efforts
        of those groups including the saving of substantial sums by way of
        quantity discounts and the improvement of quality control standards.
        


        Financial Results:
        


            "The first quarter of our fiscal year coincides with the slowest
        part of the year.  Only about 20% of our annual revenues are
        produced during this period.  The company's loss for the first
        quarter was $461,739 or $.08 per share on revenues of $13,601,000.
        Despite that, our operations generated positive operating cash flow
        of $114,266 during the period.
        


            "During the first quarter of last year (ended May 31, 1995) the
        company was building and commissioning two major plants.  Former
        management elected to capitalize substantial operational,
        administrative, interest and other carrying costs during this period
        and no depreciation on those facilities was charged to operations.
        The consequence was that the company reported a net income for the
        period of $380,010 or $.08 per share on revenues of $12,147,000.
        During the first quarter of this year, these costs were no longer
        capitalized and, as a result, our financial results bore the full
        operational and depreciation costs of plants that were still running
        at only about 29% of capacity during this slow period.
        


          Brio Beverages:
        


            "Our principal focus on this division during the quarter was on
        our new Vancouver plant.  We initiated several positive personnel
        changes there.  We were joined in April by Ed Lagos, who took over
        responsibility for management of the plant and in May by George
        Hoffman who became responsible for quality control in Vancouver.
        Together they have more than 20 years experience in the beverage
        industry and are welcome additions to our organization.  Even though
        our Edmonton plant continues to operate consistently at peak
        efficiencies we have managed to introduce some cost savings which
        should have an immediate impact on that division's contribution.  We
        have also concentrated our marketing efforts in our beverages
        division with a view to both increasing plant utilization and
        reducing the company's reliance upon its four principal customers.
        


        Brio Juices:
        


            "With the first full quarter of operation now behind its new
        Edmonton plant, the future looks bright indeed for Brio Juices.
        Many of that division's long term marketing efforts are now bearing
        fruit and plant efficiencies are approaching expected levels.  In
        the first quarter of this year, Brio Juices generated 14.2% of the
        company's consolidated gross revenue, up from 9.6% during the same
        period last year.  This is a trend that we believe will continue.
        


        Springfield Water:
        


            "Our water distribution division continued to grow and prosper
        during the first quarter of this year.  Some very good news concerns
        the resolution late last year of a labor dispute at Springfield that
        resulted in the de-certification of the labor union which had
        previously certified the division.  This division remains
        consistently profitable.
        


        Daytimer Distributors:
        


            "Daytimer continues to provide positive operating results and
        has solidified its position as the dominant beverage distribution
        company in Alberta.  Due to the fact that it was acquired in
        November 1995, Daytimer only accounted for approximately $900,000 of
        the company's revenues for fiscal 1996 and is budgeted to contribute
        almost $5,000,000 in revenues this year.
        


        Looking ahead to fiscal 1997:
        


            "During the year ended Feb. 28, 1997 management has targeted the
        company to achieve sales growth of approximately 30% over last year.
        Based upon our current product and customer mix this would result in
        annual revenues in excess of $60,000,000 and equate to an increase
        in plant utilization from approximately 29% during fiscal 1996 to
        approximately 35% during fiscal 1997.  At these levels the company
        should experience a marked improvement in performance from the
        $2,800,000 operating loss suffered last year.  The company is
        presently in a strong positive cash flow position that should be
        enhanced with the anticipated volumes.
        


            "Many of the initiatives that we have implemented are only just
        beginning to have a positive impact on the company's financial
        performance.  Although there is much work still in front of us, we
        believe that Brio is well placed to achieve the goals established in
        our annual report.  In order to finance the company's continued
        growth, management plans to pursue a significant share offering
        during the third quarter of this year."
        


            Brio and its subsidiaries are engaged in the packaging and
        distribution of juices, water and private label carbonated beverages
        in western Canada and distribution into the northwestern United
        States.
        


        (a) All amounts are expressed in Canadian dollars.


        
                               Brio Industries Inc.
                      Consolidated Statement of Income (Loss)

                        (Expressed in Canadian dollars)
        
                               Year Ended       Year Ended      
                                 Feb. 29,        Feb. 28,        
                                   1996            1995         
        
        Sales                       $46,647,342     $36,144,506
        Cost of goods sold           40,603,731      30,359,873
        Gross profit                  6,043,611       5,784,633
        Selling, general and
          administrative expenses     6,940,668       3,388,096
        Earnings (loss) before
         depreciation and interest     (897,057)      2,396,537
        Depreciation and amortization 1,860,655       1,587,187
        Interest expense (revenue) - net 82,917        (806,534)
        Operating (loss) income before
         undernoted items            (2,840,629)      1,615,884
        Restructuring costs           1,116,306               0
        Write-down of capital assets,
         goodwill and deferred
         contract costs               7,876,993          98,037
        Write-down and loss on
         investments                     52,178       7,695,464
        Settlement of lawsuits          275,000       1,252,140
        Income from discontinued
         operations                           0        (617,305)
        Loss before income taxes    (12,161,106)     (6,812,452)
        Income taxes recovery (expense)
        Current                          (2,102)      2,950,412
        Deferred                      1,335,037        (825,951)
                                  1,332,935       2,124,461
        Net loss for the year      $(10,828,171)    $(4,687,991)
        Loss per share
        Basic                            $(2.15)         $(1.03)
        Fully diluted                    $(2.15)         $(1.03)
        Weighted average number of
         shares                       5,045,916       4,555,970
     
        
                                 Brio Industries Inc.
                        Consolidated Statement of Income (Loss)

                          (Expressed in Canadian dollars)
        
                             Three Months       Three Months
                             May 31, 1996       May 31, 1995
        
        Sales                   $  13,600,808       $ 12,146,623
        Cost of goods sold         11,600,601         10,061,542
        Gross Profit                2,000,207          2,085,081
          Selling, general
          and administrative
          expenses                  1,765,672          1,270,924
        Earnings before undernoted
         items                        234,535           814,157
        Depreciation & amortization   576,005           414,810
        Interest expense (net)        120,269            19,337
        Income (loss) before income
         taxes                       (461,739)           380,010
        Income taxes                        0                  0
        Net (loss) income for the
         period                     $(461,739)          $380,010
        (Loss) earnings per share
        Basic                          $(0.08)             $0.08
        Fully diluted                  $(0.08)             $0.06
        Weighted average number
          of shares                 5,762,008          4,648,245

        
CONTACT:  BRIO Industries Inc.
                  Robert Hunt, 604/574-9220
                          or
                  Strategic Growth International Inc.
                  Stan Altschuler, 516/829-7111



HOUSE OF FABRICS PLAN OF REORGANIZATION CONFIRMED; COMPANY SET TO EMERGE FROM BANKRUPTCY AS SMALLER, STRONGER CHAIN WITH LESS DEBT


        


            SHERMAN OAKS, Calif., July 10, 1996  --  House of Fabrics,
        Inc.
(HF) today announced that the Bankruptcy Court in Los Angeles
        has confirmed its joint plan of reorganization.  Confirmation of the
        plan clears the way for the reorganized House of Fabrics to emerge
        from bankruptcy, which the company expects will occur on or about
        July 31, 1996.
        


            As part of the plan, the Court approved the company's request to
        reduce to 5.1 million the total number of shares to be issued to
        creditors and equity holders on the effective date of the plan.  In
        a previous announcement, the company said that it had asked to
        reduce the number of shares issued in order to increase the price of
        each share of common stock, thereby attempting to satisfy certain of
        the requirements to allow the company's stock to trade on a
        recognized exchange or the NASDAQ National Market System.
        


            "House of Fabrics is now free to move ahead with a restructured
        balance sheet and an improved cost structure," said Gary L. Larkins,
        president and chief executive officer.  "The new House of Fabrics is
        a smaller company, but one that is considerably stronger than it has
        been in many years.  We are confident that the company will be able
        to operate at reduced levels of revenue because of the reductions in
        overhead and debt which have been achieved over the past 20 months.
        


            "While this marks the end of the restructuring process, we will
        continue to implement plans to reduce costs and enhance revenues.
        For instance, we are in the process of expanding the point-of-sale
        (POS) systems in our stores; implementing a new integrated
        management information system; and refining and improving our
        merchandise mix as we continue to move forward."
        


            Confirmation followed the acceptance of the plan by the
        requisite number of creditor classes.  The plan had been endorsed by
        the company's secured lenders, led by Bank of America as agent, and
        the official committees representing the unsecured creditors and
        equity holders.
        


             House of Fabrics' plan of reorganization provides for a
        discounted payment of $76.5 million in cash and the cash repayment
        of borrowings against its debtor-in-possession (DIP) financing to
        the bank group, plus five (5) percent of the stock in the
        reorganized House of Fabrics. Unsecured creditors will receive 93
        percent of the stock in the reorganized company, to be distributed
        on the effective date of the plan.  Existing shareholders will
        receive two (2) percent of the stock in the reorganized company, as
        well as warrants to purchase additional shares.
        


         Since filing to reorganize 20 months ago, House of Fabrics has:
       



            Once the plan becomes effective, there will be three additions
        to the newly reorganized company's board of directors. Carl C.
        Gregory III, chairman and chief executive officer of MIP Properties,
        Inc.; John E. Labbett, executive vice president and chief financial
        officer of House of Fabrics; and Allison L. May, past president and
        general manager of Patagonia Inc. have been named to the board.
        Current members of the board who will remain are: Gary L. Larkins,
        president and chief executive officer of House of Fabrics; R. N.
        Hankin, founder, senior partner and chief executive officer of
        Hankin & Co.; H. Michael Hecht, president of Dickson Trading (North
        America) Inc.; and Mitchell G. Lynn, president and chief executive
        officer of Combined Resources International.  The latter three
        independent members of the Board were appointed in 1995.
       


            House of Fabrics operates 269 company-owned House of Fabrics,
        Sofro Fabrics, Fabricland and Fabric King retail fabric and craft
        stores in 34 states and employs approximately 7,000 people.  The
        company and its subsidiaries filed to restructure under Chapter 11
        on November 2, 1994.
        


CONTACT:  Sandra Sternberg, or Rivian Bell, of Sitrick and Company
        Inc., 310-788-2850