TCR_Public/961118.MBX




InterNet Bankruptcy Library - News for November 18, 1996






Bankruptcy News For November 18, 1996



  1. 50-OFF Stores Announces Receipt of Court Approval of Debtor-in-Possession Financing

  2. AutoLend Group, Inc. Makes Debenture Announcement Validly Tendered Debentures Will Not Be Accepted
    For Exchange If Bankruptcy Petition Is Not Dismissed

  3. Eagle-Picher Reports Confirmed Plan of Reorganization

  4. The Krystal Company Files Chapter 11 Reorganization Plan

  5. Leslie Fay files revised disclosure statement and amended joint plan of reorganization

  6. Rich International Airways Seeks Protection Of Chapter 11; Anticipates FAA And DOT Approval To
    Resume Flights Soon

  7. Trans World Entertainment Cuts Third Quarter Loss By More Than Half




50-OFF Stores Announces Receipt of Court Approval of Debtor-in-Possession Financing


SAN ANTONIO, TX--Nov. 18, 1996--San Antonio-based 50-OFF Stores, Inc. announced today that it has
received approval from the United States Bankruptcy Court for the Western District of Texas of a $15,000,000
debtor-in-possession revolving credit facility from a major financial institution. Funding under the facility is
available today. On Oct. 9, 1996, 50-OFF Stores and its significant subsidiaries filed petitions for protection
under Chapter 11 of the Bankruptcy Code. This DIP financing funding is expected to give management important
financial resources necessary to put together a reorganization plan. The proceeds of the DIP facility will be used
to refinance certain pre-petition secured debt, to provide post-petition working capital and for selected other
general corporate purposes.


The new credit facility, which matures in 12 months, bears interest at a floating rate equal to the published rate
for 30-day commercial paper issued by major corporations plus 3.00 percent per annum and provides for an
unused facility fee of 0.5 percent per annum. Borrowings under the facility are available in aggregate amounts up
to 65 percent of the company's eligible inventory for the period from Aug. 15 through Dec. 15 and up to 60
percent for the period from Dec. 16 through Aug. 14, subject to certain required reserves. At the time of the initial
funding today, the company had $10,266,781 available for borrowing under the line, of which $7,876,072 was
committed, leaving a net availability of $2,390,709.


50-OFF is a regional, off-price/close-out retailer currently operating 53 stores under the names "50-OFF" and
"LOT$OFF" in 6 states in the southern and southwestern United States. 50-OFF expects to operate approximately
50 stores through the holiday season. The company is formulating a reorganization plan which it intends to file
with the Court before year end. There are a number of alternatives that are being considered, including, but not
limited to, a financial reorganization around approximately 44 stores (with annual revenues of $75-85 million), a
strategic and/or financial affiliation with a third party and a merger or sale of all or a part of the company.


CONTACT: 50-OFF Stores, San Antonio Media: Charles Fuhrman, 210/804-4904 or Creditor: 210/804-5357




AutoLend Group, Inc. Makes Debenture Announcement Validly Tendered Debentures Will Not Be Accepted For
Exchange If Bankruptcy Petition Is Not Dismissed


ALBUQUERQUE, N.M., Nov. 18, 1996 - As previously reported by AutoLend Group, Inc. (OTC Bulletin Board:
AUTL) (the "Company"), four holders of the Company's 9.5% Convertible Subordinated Debentures due
September 19, 1997 filed an Involuntary Petition in Bankruptcy against the Company in the United States
Bankruptcy Court, District of New Mexico, on November 1, 1996, alleging that the Company is generally not
paying its debts as they become due. The Company has denied the allegation and has filed an answer in the
Bankruptcy Court in an effort to have the petition dismissed. A hearing before the Bankruptcy Court is presently
scheduled for December 6, 1996. The Company is paying all of its debts as they become due but, as previously
disclosed, has not paid the interest on the Debentures because the Company is engaged in its Exchange Offer, the
effect of which is to exchange all principal amount outstanding of Debentures, together with accrued interest
thereon, for common stock and preferred stock.


The Company has determined that, as a result of the filing of the Involuntary Petition in Bankruptcy, the Company
will not accept for exchange any Debentures unless and until the Involuntary Petition in Bankruptcy has been
dismissed. Consequently, a holder who has tendered Debentures for exchange prior to November 25, 1996, the
Expiration Date, will nonetheless retain his status as a creditor of the Company until the Involuntary Petition in
Bankruptcy is dismissed and the Company thereafter accepts such holder's Debentures for exchange in
accordance with the Exchange Offer. The Company has concluded that the failure to have the Involuntary Petition
in Bankruptcy dismissed would constitute a material adverse effect on the business, financial condition, and
prospects of the Company, giving rise to the occurrence of a condition to the Exchange Offer as a result of which
the Company shall not be required to accept for exchange any Debentures tendered.


The Company expressly reserves the right to extend the period of the Exchange Officer, to terminate the Exchange
Offer or to otherwise amend the Exchange Offer in any respect, subject to the terms set forth in the Offering
Circular as supplemented.


SOURCE AutoLend Group, Inc. /CONTACT: Nunzio P. De Santis, Chairman, AutoLend Group, Inc.,
505-768-1000/




Eagle-Picher Reports Confirmed Plan of Reorganization


CINCINNATI, OH - Nov. 18, 1996 - Eagle-Picher Industries (OTC: EPIHQ.U) today announced that the U.S.
Bankruptcy Court in Cincinnati entered an order confirming the Company's Third Amended Consolidated Plan of
Reorganization (the "Plan"). The Plan was filed jointly by the Company, the Injury Claimants' Committee ("ICC")
and the Representative for Future Claimants ("RFC"). The ICC represents approximately 150,000 persons
alleging injury due to exposure to asbestos-containing products manufactured by Eagle- Picher from 1934 until
1971. Future personal injury claimants are represented by the RFC. The Unsecured Creditors' Committee
appointed in the chapter 11 cases also supported confirmation of the Plan.


Based on the settlement of $2.0 billion for the Company's liability with respect to present and future
asbestos-related personal injury claims, the Company's estimate that all other prepetition claims aggregate
approximately $157 million, and the expected value of the equity of the reorganized Company, the Company
anticipates that each holder of prepetition general unsecured claims, including environmental claims, will receive
a distribution equal to approximately 37% of its claims. Such distribution will be paid 1/2 in cash and 1/2 in
notes with a three-year maturity.


Pursuant to the Plan, all present and future asbestos and lead- related personal injury claims will be channeled to
a trust (the "Trust") which will resolve and satisfy all such claims. Under the Plan, the Trust will receive
distributions consisting of cash, certain notes, and all of the stock of reorganized Eagle-Picher. Any person with
an asbestos or lead-related personal injury claim must pursue that claim against the Trust and not against the
reorganized Company. Consistent with the foregoing, the order confirming the Plan which was issued by both the
United States District Court and the Bankruptcy Court contains an injunction which precludes holders of present
and future asbestos or lead-related personal injury claims from pursuing their claims against reorganized
Eagle-Picher. Based upon the above assumptions, the Company estimates that the aggregate value of the
consideration to be distributed to the Trust will be equal to approximately 37% of the $2.0 billion settlement
amount with respect to the Company's estimated liability for present and future asbestos-related personal injury
claims. A similar trust, to be funded with $3 million under the Plan, will be established to resolve and satisfy
asbestos property damage claims which will be channeled to that Trust.


Upon the effective date of the Plan, the Company intends to enter into a new unsecured $60 million revolving
credit facility with a group of banks. It is anticipated that this committed facility will have a three-year term and
will be available for both cash borrowings and letters of credit. The Company views this facility as a backup for
working capital needs, not as a long-term source of financing.


As was the case with previously proposed plans, the Company's existing equity security holders will receive no
distribution under the Plan and their shares will be canceled.


Thomas E. Petry, Eagle-Picher Chairman, said that, "a major objective of the Company was to emerge from
chapter 11 with a capital structure suitable for an industrial products company such as Eagle-Picher. It is
important to note that the $2.2 billion of the liabilities subject to compromise (consisting of the estimated
asbestos-related personal injury liability and claims of general unsecured creditors) which last appeared on the
Company's balance sheet as of August 31, 1996, and produced a negative net worth, will be discharged pursuant
to the Plan upon the effective date of the Plan. As a result, reorganized Eagle-Picher will enjoy a positive net
worth of approximately $340 million. The resulting capital structure of reorganized Eagle-Picher will be like
many other companies manufacturing similar products and serving similar markets. During the reorganization
process sales have increased to an estimated $890 million for 1996 from $598.6 million in 1991. Operating
income will have increased accordingly. Also during the period, from 1991 to the end of fiscal 1996, the
Company invested $193 million in new plant and equipment.


"Eagle-Picher has historically generated a very healthy cash flow from operations and it is fully expected that this
trend will continue. I believe that the Company will have the financial resources to pursue all attractive
investment opportunities."


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




The Krystal Company Files Chapter 11 Reorganization Plan


CHATTANOOGA, Tenn., Nov. 18, 1996 - The Krystal Company (Nasdaq-NNM: KRYSQ), an operator and
franchiser of quick-service hamburger restaurants, announced today that it has filed its Chapter 11 Reorganization
Plan and Chapter 11 Disclosure Statement in the United States Bankruptcy Court for the Eastern District of
Tennessee. A court hearing on the Disclosure Statement is scheduled for December 23, 1996.


The Plan calls for the payment in full of all claims that are allowed by the Bankruptcy Court, including allowed
claims of current and former employees who have alleged that the Company violated the Fair Labor Standards
Act. More than 1,500 of these claims have already been disallowed by the Bankruptcy Court. The process of
settling and contesting the amount of the remaining claims is continuing.


In addition to FLSA claims, trade claims totaling approximately $7.5 million, indebtedness to insurance
companies of approximately $36 million, secured indebtedness of approximately $3 million, and bank
indebtedness of approximately $2.6 million will all be repaid in full under the Plan's terms.


Krystal currently has a reserve of $9.8 million to cover FLSA claims, and Company Chairman Carl D. Long
reiterated that management believes this reserve is adequate to cover all allowed claims: "While the Chapter 11
Disclosure Statement uses a worst case assumption of $13 million for the FLSA claims, our review of these
claims has led us to conclude that our previously announced reserve is adequate. Our intention in entering
Chapter 11 was to fully and finally resolve all valid FLSA claims. The Company believes the Plan it has filed
will accomplish that goal."


The Company stated that it expects the Plan to be submitted to creditors for approval in January 1997, and
assuming approval, that it will emerge from bankruptcy before the end of the first quarter of 1997. The Company
has been a debtor-in-possession since its Chapter 11 petition was filed on December 15, 1995.


Founded in 1932, Krystal is one of the oldest fast-food chains in the United States. The Krystal Company's
common stock is traded on the Nasdaq National Market System under the symbol KRYSQ.


SOURCE The Krystal Company /CONTACT: Robert Mead for The Krystal Company, 212-484-6701/




Leslie Fay files revised disclosure statement and amended joint plan of reorganization


NEW YORK, NY --Nov. 18, 1996--The Leslie Fay Companies, Inc. today announced that the company and the
Official Committee of Unsecured Creditors of Leslie Fay have filed an amended joint plan of reorganization with
the U.S. Bankruptcy Court for the Southern District of New York. Leslie Fay has also filed a revised disclosure
statement with the court in connection with the solicitation of acceptances and rejections of the joint plan by the
company's creditors.


As previously announced, the joint plan of reorganization provides for the company to emerge from chapter 11 by
separating its Sassco Fashions business from its core Leslie Fay businesses. If this proposed plan is
consummated, Leslie Fay's current equity will be extinguished.


"We are very pleased with Leslie Fay's continuing progress -- particularly with regard to rebuilding our core
dress and sportswear businesses and winning back our customers," said John J. Pomerantz, chairman and chief
executive officer of Leslie Fay. "We are hopeful that the filing of the amended plan of reorganization and revised
disclosure statement will enable Leslie Fay to emerge from chapter 11 protection in the near future."


Founded in 1947, The Leslie Fay Companies, Inc., is one of the nation's leading manufacturers of women's
apparel, including dresses, suits and sportswear. Its brand names include Leslie Fay, Albert Nipon, Kasper for
A.S.L., Castleberry, Outlander, and HUE.


Contact: Michael Freitag James Fingeroth Kekst and Company 212/593-2655




Rich International Airways Seeks Protection Of Chapter 11; Anticipates FAA And DOT Approval To Resume
Flights Soon


MIAMI, FL - Nov. 18, 1996 - Rich International Airways, Inc., a Miami-based charter airline, today sought
protection from creditors by filing a petition for reorganization under Chapter 11 of the federal bankruptcy code
in the U.S. Bankruptcy Court in the Southern District of Florida.


The airline, grounded on September 2 by the Federal Aviation Administration, primarily due to discrepancies it
found in company crew training records, said today's filing will permit it to conserve cash, and direct its
resources toward resumption of flight operations at the earliest possible date.


"This should not be looked upon as a negative development for Rich," said company President William Meenan.
"We view today's filing as an important step toward resuming flight operations and returning employees to work
in the near future."


Rich believes that it is nearing the end of its certificate revalidation program, a cooperative undertaking between
the company and the FAA. Crew training programs have been approved and recurrent training programs have
been completed for flight and cabin crewmembers who will be the first to be recalled to begin flight operations.


"Given the current environment, the FAA has been exceedingly cautious throughout the revalidation process, and
Rich has cooperated fully in meeting or exceeding the FAA's requests throughout the process," Meenan said. "We
believe that we are close to finalizing the program, and could be airborne again in a short period.


"But because the company's income virtually halted with the grounding 78 days ago, the preservation of assets
permitted under the bankruptcy process will permit us to expedite the return of flights once the revalidation
program is completed, and the Department of Transportation has again found us fit," Meenan said. "All of us at
Rich look forward with great anticipation to the rapid return of Rich jetliners to the air."


At the time of the grounding, Rich operated a fleet of 21 L-1011 and Super DC-8 jetliners in worldwide
passenger and military charter services. The company, founded 27 years ago in Miami, has operated throughout
its entire history without a single serious injury or fatality to either a passenger or crewmember resulting from its
flight operations. When it halted flights on September 2, it employed 1,130 men and women worldwide.


SOURCE Rich International Airways, Inc.  /CONTACT: Mike Clark, Clark Communications, 305-874-1651/




Trans World Entertainment Cuts Third Quarter Loss By More Than Half


ALBANY, N.Y.--November 18, 1996--Trans World Entertainment Corporation (Nasdaq National Market:
TWMC) today announced sales of $98 million for the 13 weeks ended November 2, 1996, compared to $103
million for the same period last year. The net loss for the quarter narrowed by more than one half to $2.5 million,
or ($.25) per share, compared to a net loss of $5.1 million, or ($.52) per share, in the comparable 1995 quarter.
Comparable store sales for the third quarter of 1996 increased 4%.


For the 39-week year-to-date period of 1996, the Company reported total sales of $301 million compared to
$319 million for the same period in 1995. Total sales during the 1996 period reflect sales from 497 stores
compared to 604 stores in the same period last year. The net loss was $7.6 million, or ($.78) per share,
compared to a net loss of $15.3 million, or ($1.57) per share, for the respective 39-week periods of 1996 and
1995. Comparable store sales for the first nine months of 1996 increased 5%.


Robert J. Higgins, Trans World's Chairman, President, and Chief Executive Officer commented, "Our third
consecutive quarter of improving performance reaffirms the effectiveness of the restructuring plan we initiated in
1994. Despite a weak schedule of new releases in the third quarter, we achieved comparable store sales gains
with an improved inventory mix and merchandising presentation. During the quarter we continued our
restructuring program by closing 16 of our least profitable locations, bringing the year-to- date total to 59 and
238 since the fourth quarter of 1994. Also in the quarter, we added 10 new stores and will open an additional 8
stores by the end of November."


Gross profit as a percentage of sales in the third quarter of 1996 increased to 37.1% from 34.9% in the third
quarter of 1995. Improvements in pricing, purchase discounts and deeper catalog sales all contributed to the
higher gross profit. Selling, general and administrative expenses decreased to 34.7% of sales in the third quarter
of 1996 from 35.7% in the third quarter of 1995.


Interest expense decreased to $2.7 million in the third quarter of 1996 from $3.6 million in the comparable
period in 1995. Although interest rates were higher in the third quarter of 1996, amounts outstanding under the
Company's loan agreements were lower than in the same period of 1995. Total debt as of November 2, 1996 is
$86 million, versus $133 million a year ago. Long-term debt stands at $53 million, compared to $63 million in
the comparable 1995 period.


Mr. Higgins added, "We anticipate a good fourth quarter and being profitable for the year. We view 1997 with
optimism and further improvement in our operating results."


Trans World Entertainment is a leading specialty retailer of music and video products. The Company operates
retail stores under Record Town, Tape World, F.Y.E., Saturday Matinee and Coconuts Music and Movies.


Certain statements in this quarterly report set forth management's intentions, plans, beliefs, expectations or
predictions of the future based on current facts and analyses. Actual results may differ materially from those
indicated in such statements. Additional information on factors that may affect the business and financial results
of the Company can be found in filings of the Company with the Securities and Exchange Commission.


        TRANS WORLD ENTERTAINMENT CORPORATION
        

        INCOME STATEMENTS:
        (in thousands, except per share data)
        

                                    Thirteen Weeks Ended    
                            November 2,  % to    October 28,  % to
                             1996       Sales      1995      Sales
                                          (unaudited)
        

        Sales                   $97,583    100.0%    $103,165    100.0%
        

        Cost of sales            61,366     62.9%      67,195     65.1%
        

        Gross profit             36,217     37.1%      35,970     34.9%
        

        Selling, general and
        administrative expenses  33,898     34.7%      36,832     35.7%
        

        Depreciation and 
        amortization              3,475      3.6%       3,978      3.9%
        

        Loss from operations     (1,156)    -1.2%      (4,840)    -4.7%
        

        Interest expense          2,657      2.7%       3,635      3.5%
        

        Loss before income tax 
         benefit                 (3,813)    -3.9%      (8,475)    -8.2%
        

        Income tax benefit       (1,337)    -1.4%      (3,382)    -3.3%
        

        NET LOSS                ($2,476)    -2.5%     ($5,093)    -4.9%
        

        NET LOSS PER SHARE       ($0.25)               ($0.52)      
        

        Weighted average 
         number of shares
         outstanding              9,741                 9,733        
        -0-
        SELECTED BALANCE SHEET HIGHLIGHTS:
        (in thousands, except store data)
        

        Cash and cash 
         equivalents             $8,324                $6,618
        

        Merchandise inventory   214,084               258,379
        

        Fixed assets (net)       64,401                79,575
        

        Accounts payable        116,965               132,942
        

        Long-term debt, less
         current portion          45,096                  574
        

        Shareholders' equity      86,630              104,169
        

        Stores in operation          497                  604
        

                              Thirty-nine Weeks Ended
                           November 2,  % to    October 28,    % to
                             1996       Sales     1995         Sales
                                        (unaudited)
        

        Sales                   $300,922   100.0%    $319,369     100.0%
        

        Cost of sales            192,920    64.1%     208,430      65.3%
        

        Gross profit             108,002    35.9%     110,939      34.7%
        

        Selling, general and
        administrative expenses  100,261    33.3%     113,123      35.4%
        

        Depreciation and 
         amortization             10,655     3.5%      12,333       3.9%
        

        Loss from operations      (2,914)   -1.0%     (14,517)     -4.5%
        

        Interest expense           8,800     2.9%      10,954       3.4%
        

        Loss before income tax 
         benefit                 (11,714)   -3.9%     (25,471)     -8.0%
        

        Income tax benefit        (4,107)   -1.4%     (10,163)     -3.2%
        

        NET LOSS                 ($7,607)   -2.5%    ($15,308)     -4.8%
        

        NET LOSS PER SHARE        ($0.78)              ($1.57)
        

        Weighted average 
         number of shares
         outstanding               9,738                9,723
        -0-
        SELECTED BALANCE SHEET HIGHLIGHTS:
        (in thousands, except store data)
        

        Cash and cash equivalents $8,324               $6,618
        

        Merchandise inventory    214,084              258,379
        

        Fixed assets (net)        64,401               79,575
        

        Accounts payable         116,965              132,942
        

        Long-term debt, less
         current portion          45,096                  574
        

        Shareholders' equity      86,630              104,169
        

        Stores in operation          497                  604
        
        

CONTACT: MWW/Strategic Communications, Inc.

Public Relations - Tel. (201) 507-9500

Media Contact: Michael Kempner -- mkempner@mww.com

Rob Swadosh -- rswadosh@mww.com

Investor Contact: Robert Ferris-- rferris@mww.com