InterNet Bankruptcy Library - News for January 20, 1997

Bankruptcy News For January 20, 1997

  1. Thermo Ecotek Subsidiary Acquires Biosys

  2. Kiwi Defies Odds and Inaugurates Service

  3. Helionetics subsidiary discharged from bankruptcy; lighting company says it will be
    profitable in 1997 on revenues ranging from $11 million to $17 million

  4. First Alert CEO announces company-wide restructuring and operating changes;
    associated charge will contribute to 1996 net loss

  5. Italian Oven Announces Court Approval of Asset Sale to Whitecliff Group

  6. Bankruptcy Not Only Alternative For PSNH, Says Fitch - Fitch Financial Wire

Thermo Ecotek Subsidiary Acquires Biosys

WALTHAM, Mass., Jan. 20, 1997 - Thermo Ecotek Corporation (AMEX: TCK) today
announced that its wholly owned subsidiary, Thermo Trilogy Corporation, has acquired
for approximately $11 million substantially all the assets of biosys, inc., including the
stock of a wholly owned subsidiary, AgriSense-BCS, Ltd., a U.K. company. Biosys is a
biopesticide company based in Columbia, Maryland.

In September 1996, biosys filed for reorganization under Chapter 11 of the U.S.
Bankruptcy Code. The sale was subject to, and received, approval by the bankruptcy court
on January 7, 1997.

Biosys produces pheromone, neem/azadirachtin, nematode, and virus-based biopesticide
products, as well as disease-resistant sugar cane. "With the biosys acquisition, we will
make significant progress in our strategy to pursue environmental technology businesses,"
said Brian D. Holt, president and chief executive officer of Thermo Ecotek. "The biosys
products will greatly enhance Thermo Trilogy's line of environmentally friendly
alternatives to chemical pesticides."

Thermo Ecotek Corporation is an environmental company involved in clean combustion
and engineered clean fuels, as well as a range of other environmentally sound
technologies. Its biopesticides subsidiary, Thermo Trilogy Corporation, specializes in
naturally derived products for protecting crops. Thermo Ecotek is a public subsidiary of
Thermo Electron Corporation.

This press release contains forward-looking statements that involve a number of risks and
uncertainties. Important factors that could cause actual results to differ materially from
those indicated by such forward-looking statements are set forth under the caption
Forward-looking Statementsq in Exhibit 13 to the company's Annual Report on Form 10-K
for the year ended September 28, 1996. These include uncertainties in government
regulation and approvals, project development and operations, access to capital, use of
potential tax credits, and community support; the impact of competition; and risks
associated with increased fuel prices and reduced availability of fuel, international
operations, the biopesticides business, and dependence on utility customers.

SOURCE Thermo Ecotek Corporation

Kiwi Defies Odds and Inaugurates Service

NEWARK, N.J., Jan. 20, 1997 - After suspending scheduled service on October 15, KIWI
Air Lines
will defy all odds and inaugurate service today between Newark, Chicago,
Atlanta and West Palm Beach. KIWI's restart is rare among businesses, and may be the
only airline to come back after shutdown due to Chapter 11. It was made possible through
$8.5 million debtor-in-possession financing by Edwards-Wasatch Enterprises.

"KIWI's inauguration may not be the bash that is going on in Washington today, but it is
probably more symbolic of American perseverance and competitiveness than anything
Washington can muster," said Jerry Murphy, President and CEO. "I want to welcome back
the 500 employees who returned in the past few weeks. It was their good deeds that gave
KIWI its reputation for excellence, and it will be their continued dedication that will
restore our glory. I want to welcome the travel professionals, whose support is essential to
our future. Most importantly, I want to welcome back our passengers to affordable fares
and great service."

KIWI's inauguration is marked by $99 and $79 unrestricted fares effective until January
31. And, until February 12, passengers will receive "Buy Once. Fly Twice." coupons good
for a flight later in 1997. KIWI is calling its pricing strategy "Fair Fares."

Murphy added: "The reason America needs carriers like KIWI boils down to competition.
I don't think many people were surprised when fares went up by as much as $350 one way
when we suspended scheduled service because the big airlines were just waiting for an
opportunity to raise airfares for business travelers. We bring to the marketplace affordable
fares, award-winning service, a frequent flyer program and a perfect flying record."
Murphy noted KIWI will operate seven 727-200 aircraft, and has called back over 500
employees in the past few weeks.

On January 15, KIWI received U.S. Bankruptcy Court approval for a $3.5 million letter of
credit facility from Edwards-Wasatch Enterprises. This is in addition to the previously
approved $5 million debtor-in-possession financing. Edwards Wasatch has committed to
raise additional funds upon reorganization of KIWI.

SOURCE KIWI International Air Lines /CONTACT: Rob Kulat of KIWI Air Lines,

Helionetics subsidiary discharged from bankruptcy; lighting company says it will be
profitable in 1997 on revenues ranging from $11 million to $17 million

VAN NUYS, Calif.--Jan. 20, 1997--Helionetics Inc. (OTC/BB:HLXC) Monday said
subsidiary Tri-Lite Inc.'s plan of reorganization has been confirmed by the U.S.
Bankruptcy Court, Santa Ana, Calif., and that Tri-Lite has been discharged from

Tri-Lite filed for protection under Chapter 11 of the Federal Bankruptcy Code Feb. 26,

A Tri-Lite spokesman said the company is in the process of bringing its regulatory filings
up to date and expects its common shares to resume trading in the public marketplace in
the near future.

As a result of the reorganization, Helionetics owns 87.5 percent of Tri-Lite's common

The spokesman said Tri-Lite and its subsidiary companies have been profitable on a
consolidated basis since and including September 1996. He said revenues in
calendar/fiscal 1997 should range between $11 million and $17 million and that the
company expects to maintain its profitability.

As part of the reorganization, Helionetics contributed to Tri- Lite, a Santa Ana-based
designer, manufacturer and marketer of lighting systems, its AIM Energy Inc. subsidiary
whose patented AIM filter is now being marketed as a mitigator of harmonics (electrical

Excessive harmonics is a potential cause of fires in office, industrial and large residential
buildings that contain a large number of computers, fax machines, high-speed elevators and
other equipment that uses electricity. -0-

Note: Certain of the above statements may be forward-looking statements that involve
risks and uncertainties. In such instances, actual results could differ materially as a result
of a variety of factors, including competitive developments and risk factors listed from
time to time in the company's Securities and Exchange Commission reports.

CONTACT: Helionetics Inc. Chaim Markheim, 800/421-7915 or ACC Communications
Paul Keil, 714/487-1988 Andy Malone, 714/366-5803

First Alert CEO announces company-wide restructuring and operating changes; associated
charge will contribute to 1996 net loss

AURORA, Ill.--Jan. 20, 1997--First Alert, Inc. (NASDAQ: ALRT) today announced a
series of actions designed to: Revitalize the Company's core product lines of smoke and
carbon monoxide (CO) detectors and discontinue, reposition or outsource non- performing
product lines; Right-size and consolidate manufacturing operations; Reduce the Company's
selling, general and administrative cost structures; and Aggressively address inventory

The actions taken by the Company will result in taking a pre-tax charge in the 1996 fourth
quarter of approximately $9.5 million or $0.23 per share. The charge includes costs
associated with product line decisions, related inventory and manufacturing equipment
write- downs and severance costs.

The announcement was made by B. Joseph Messner, who was named President and Chief
Executive Officer in September of last year. In reporting third quarter September 30, 1996
operating results in late October, Mr. Messner announced that he intended to take decisive
actions to refocus and refresh First Alert's product lines to more effectively compete in the
evolving market environment.

Mr. Messner stated: "The mandate we undertook with the Board was to take a fresh,
penetrating look at the market segment in which we operate and the Company's ability to
compete successfully.

"First Alert's primary focus is the residential safety marketplace and on the opportunities
which exist within its core product categories of smoke detectors and carbon monoxide
detectors. Actions are underway to strengthen the Company's smoke detector lines with an
emphasis on product design, features, benefits and enhancing consumer value. Similar
activities are underway regarding carbon monoxide detectors, with a particular focus on
building consensus among standards-setting organizations within the market in order to
reduce confusion and build consumer confidence necessary to stimulate growth within the

Secondary product lines viewed as non-contributing are being repositioned, reduced in the
number of SKUs, outsourced and/or exited entirely. Advertising and public relations
campaigns will communicate a stronger brand message stressing the advantages of First
Alert products.

"We are also right-sizing our manufacturing operations and selling, general and
administrative expense levels and have recognized related costs including severance. We
have reduced our staffing levels by 600 full-time equivalents, achieving estimated annual
cost savings of $3 million. Additionally, recognizing changes in the market for certain
products, we have provided for costs associated with reducing excess inventory levels."

Mr. Messner concluded: "The still inappropriately high levels of inventory we have on
hand as we enter our slowest selling periods will delay the effect of these actions being
seen in any immediate, dramatic bottom-line turnaround. We are confident, however, that
these sweeping, but carefully considered actions, along with our leveraging the Company's
fundamental strengths of brand equity, broad distribution base and strong market growth
fundamentals, should position First Alert for improved and sustainable profitability in the
future and will further enhance the Company's leadership position in the growing home
safety marketplace."

The Company estimated that revenues in the 1996 fourth quarter period ended December
31, 1996 will be approximately $60 million, down from the $76.4 million reported in the
prior 1995 period. The decrease is associated with lower sales of smoke detectors
reflecting lost distribution in certain key accounts, and general market softness, as well as
generally lower average selling prices of carbon monoxide detectors compared to the
same period in 1995.

Before the charge, the Company estimated it incurred an operating loss of approximately
$4.5-to-$5.0 million in the 1996 fourth quarter which would be equal to approximately
$0.18-to-$0.20 per share. Beyond the impact of the reduced level of sales, the operating
loss in the quarter reflects the effect on gross margin of sharply reduced levels of
production and resulting plant underutilization in the period to preclude additional
inventory build-up. However, the Company noted that these same actions dramatically
improved cash flow and reduced the Company's net borrowing requirements by $17
million in the fourth quarter.

In 1995 fourth quarter, First Alert reported a net loss of $2,077,000, or $0.08 per share, on
sales of $76.4 million. For the full year 1995, the Company earned $11.4 million, or $0.46
per share, on sales of $246.3 million.

For the first nine months of 1996, the Company reported a net loss of $8,235,000, or $0.34
per share, on sales of $145.3 million.

First Alert expects to release complete and final results for the fiscal 1996 fourth quarter
and year-end toward the beginning of February.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: The
statements in this release that relate to future plans, expectations, events, performance and
the like are forward-looking statements, within the meaning of the Private Securities
Litigation Reform Act of 1995 and the Securities Exchange Act of 1934. Actual results or
events could differ materially from those described in the forward-looking statements due
to a variety of factors, including those set forth in the Company's report on Form 10-Q
filed with the Securities and Exchange Commission on November 13, 1996.

First Alert, through its subsidiaries, is a leading manufacturer and marketer of a broad
range of residential safety products anchored by the Company's leadership position in the
U.S. residential smoke detector and carbon monoxide detector markets. First Alert. is
considered to be the most widely-recognized consumer brand name in home safety.

CONTACT: Mike Rohl John P. Kehoe/Van Negris First Alert, Inc. Kehoe, White, Savage
& Company, Inc. (630) 851-7330 (212) 888-1616

Italian Oven Announces Court Approval of Asset Sale to Whitecliff Group

LATROBE, Pa., Jan. 20, 1997 - The Italian Oven, Inc. (Nasdaq: OVEN) (the "Company")
today announced that the Bankruptcy Court overseeing the Company's reorganization under
Chapter 11 of the Bankruptcy Code approved the sale of substantially all of the assets of
the Company to an affiliate of The Whitecliff Group, Inc. The Court's order, which was
entered by Judge Judith K. Fitzgerald, was dated January 19, 1997.

J. Garvin Warden, Interim Chief Executive Officer for the Company said, "This sale was
accomplished on an expedited basis as a result of the persistence of the Whitecliff Group
and the dedicated efforts of the Company's creditors, franchisees, management, employees
and the Company's counsel, Sable, Makoroff & Gusky, P.C."

The Company and Whitecliff anticipate that the asset sale will be completed on or before
January 31, 1997.

SOURCE Italian Oven /CONTACT: J. Garvin Warden of The Italian Oven,

Bankruptcy Not Only Alternative For PSNH, Says Fitch - Fitch Financial Wire

NEW YORK, NY - Jan. 20, 1997 - On Friday, Northeast Utilities' CFO John H. Forsgren
set off an alarm in the utilities industry in his testimony before the New Hampshire Public
Utilities Commission. Forsgren said that a report by the commission's consultant
recommends market pricing of electricity and threatens to cause the bankruptcy of Public
Service Company of New Hampshire (PSNH) and North Atlantic Energy Corp.

In deregulation, Northeast Utilities will most likely be able to recover at least a portion of
its $800 million in assets under review by the commission, Fitch says. Failure to allow
recovery would set New Hampshire apart from every other state that has addressed the
issue of deregulation, asset recovery and the cost of electric service.

Previously, Fitch has hypothesized an industry recovery average of between 70% and
90%. In New Hampshire, recover may fall in the low end of that average, because
regulators fear adding recovery costs to the state's electric rates, which rose considerably
after the 1987 bankruptcy of PSNH. PSNH emerged from bankruptcy in 1991 and was
acquired by Northeast Utilities in 1992.

SOURCE Fitch Investors Services /CONTACT: Ellen Lapson of Fitch Investors Service,