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/raid1/www/Hosts/bankrupt/TCR_Public/980130.MBX T R O U B L E D C O M P A N Y R E P O R T E R Friday, January 30, 1998, Vol. 2, No. 21 Headlines ALLIANCE ENTERTAINMENT: Bar Date Set - February 27 AMETECH, INC.: Extends Interim Agreement with Lender BARRY'S JEWELERS INC.: Hires SBC Warburg to Help with Plan CAMPO ELECTRONICS: Seeks Extension of Exclusivity CINCINNATI MICROWAVE: Asks How to Pay Key Employee Bonuses EVANSVILLE BREWERY: Closing Means Less Revenue for City GUY F. ATKINSON: Cash Collateral Extended HOME HOLDINGS INC.: Files Petition for Bankruptcy HOME THEATER PRODUCTS: Chapter 11 Plan PARAGON TRADE: Applies to Employ Special Counsel PARAGON TRADE: Needs Ongoing Utility Services SOURCECOM: Court Approves Settlement with Creditors STREAMLOGIC: Files Disclosure Statement and Plan TAL WIRELESS: Creditor Objects to Sale and Offers More THE WIZ: Cablevision Electronics Poised for Purchase WEINER'S STORES INC.: Unveils Post-Bankruptcy Capital Plan WESTMORELAND COAL: Court Deems Proof of Claim Filed on Time WESTMORELAND COAL: Court Approves Attorney for Retirees DLS CAPITAL: Bond pricing for week of January 26 ******* ALLIANCE ENTERTAINMENT: Bar Date Set - February 27 -------------------------------------------------- Pursuant to an order of court dated January 15, 1998, all creditors of the debtors are require to file a proof of claim on or before February 27, 1998. AMETECH, INC.: Extends Interim Agreement with Lender ---------------------------------------------------- Ametech, Inc. (OTC Bulletin Board: AMET) announced January 28, 1998, that it has reached agreement to extend the forbearance agreement with its lender through February 1, 1998. Under the previous forbearance agreement that terminated on January 5, 1998, the lender had agreed that for a five-week period it would forbear from taking certain actions against Ametech as a result of defaults under the loan agreement and would continue to provide a revolving credit facility, allow the use of certain reserves and make a limited over-advance accommodation. That agreement allowed Ametech to continue limited operations at its Environmental Transportation Services, Inc. subsidiary (ETS) during the month of December. Under the new forbearance agreement the lender has agreed to provide only limited over-advance accommodations. The current agreement will allow Ametech to continue only limited rental operations of its Environmental Transportation Services, Inc., subsidiary through the end of January 1998. It also provides that the lender would forbear from taking certain actions against Ametech as a result of defaults under the loan agreement until February 1, 1998. All other transportation and related operations have been discontinued. While Ametech will continue to explore its strategic alternatives it is likely that the company will need to file for protection from its creditors under Chapter 11 of the U.S. Bankruptcy Code at the end of the current forbearance period. BARRY'S JEWELERS: Hires SBC Warburg to Help With Plan ----------------------------------------------------- Federal Filings reports on January 28, 1998, that after ringing up holiday sales that beat projections, Barry's Jewelers may now focus on developing a reorganization plan and has received court approval to hire SBC Warburg Dillon Read Inc. to assist with financial aspects of the process. Swiss Bank Corp.'s investment banking unit will be evaluating "any and all alternatives" for the retailer, including potential merger or sale transactions, said Barry's Chief Financial Officer E. Peter Healey. CAMPO ELECTRONICS: Seeks Extension of Exclusivity ------------------------------------------------- Federal Filings reports on January 28, 1998 that Campo Electronics Inc. said it is negotiating with its major creditors to develop a consensual reorganization plan and asked the court to extend the company's exclusive period for filing a plan through Feb. 14. The retailer said the 30-day extension also is needed to properly "evaluate the company's future performance in light of the recent Christmas season." CINCINNATI MICROWAVE: Asks How to Pay Key Employee Bonuses ---------------------------------------------------------- Cincinnati Microwave, Inc., reorganized debtor, asks the court for an order providing the debtor with instruction with respect to the payment of key employee retention bonuses. The debtor is asking the court for a determination as to the period covered by the "asset sales" and how to calculate the proceeds from "asset sales" for the purposes of the bonus calculations. Dependent on the method of calculation (and the debtor offers three interpretations) the aggregate bonuses range from a high of $155,400 to a low of $21,300. With one interpretation, more bonuses could be due in the future. This motion has been set for hearing on February 11, 1998. EVANSVILLE BREWERY: Closing Means Less Revenue for City -------------------------------------------------------- The Evansville Courier reported on 01/24/98 that the closing of Evansville Brewing Co. operations could mean a major loss in monthly water and sewer revenue for the Evansville Utility Department this year unless other customers pick up the slack. Utility officials, however, believe there will be other industrial, commercial and wholesale customers with increasing water needs who will more than compensate for the brewery shutting down. In particular, officials expect water companies in other counties supplied by Evansville with water will continue to need more water in the future. Evansville Brewing was the utility's third-largest water user last year, receiving 121.8 million gallons during the year even with an on- again, off-again operation before closing. In 1996, the brewery used 163 million gallons of water. But utility officials also saw sharp increases in water usage by other industrial and commercial customers that promise to offset the revenue lost from the brewery. Evansville Brewing's monthly water and sewer bills were in the range of $30,000. But the utility didn't receive all the money due last year from those bills. GUY F. ATKINSON: Cash Collateral Extended ----------------------------------------- In the case of Guy F. Atkinson Company of California, Guy F. Atkinson Company and Guy F. Atkinson Holdings, Ltd., debtors, Judge Thomas E. Carlson entered an order extending the Third Cash Collateral Order until February 15, 1998. The debtors' authority to borrow funds and obtain DIP financing from the Bonding Companies and to grant liens and priorities therefor will terminate on January 31, 1998. There will be a hearing on February 13, 1998 at which time the court will consider the debtors' motion for continued use of cash collateral in the Pool II Assets, and any funding arrangements that may be proposed for Pool I Assets. HOME HOLDINGS: Files Petition for Bankruptcy -------------------------------------------- On January 15, 1998, Home Holdings Inc. filed a Chapter 11 petition with the U.S. Bankruptcy Court, Southern District of New York (Manhattan). The Debtor, a Delaware corporation, is a holding company, primarily for its wholly owned subsidiary, The Home Insurance Company, a New Hampshire property and casualty company. The petition lists Home Holdings' total assets as $2,828,031.73 and total liabilities of $644,418,059.53 (as of January 15, 1998). The Debtor has retained Skadden, Arps, Slate, Meagher & Flom LLP as counsel for their petition with Kayalyn A. Marafioti, attorney. The Court will hold a hearing to consider approval of the Disclosure Statement on February 27, 1998 at 9:30 a.m. The Court will also hold a hearing to consider confirmation of the Plan on April 3, 1998 at 9:30 a.m. These parties have been appointed to the committee of unsecured creditors: - Contrarian Capital Management LLC - Cerberus Partners, L.P. - Credit Suisse First Boston Corp. HOME THEATER PRODUCTS: Chapter 11 Plan -------------------------------------- Home Theater Products International, Inc., dba HTP International, Inc. filed a plan and the plan confirmation hearing is impending. The plan designates three classes of claims and two classes of interest holders. The Disclosure Statement hearing was June 11, 1997 and the plan confirmation hearing is set for January 28, 1998. Class 1 - Secured claim of the Bank of America N.T. & S.A. This claim in the amount of $11,592,292.18 is impaired and will be treated as agreed between the parties. Class 2 - Unsecured claims entitled to priority status Paid in full. ($10,196.15) Class 3 - General unsecured claims ($2,385,941.03) are impaired and will receive a pro rata share from litigation proceeds. Class 4 - Claims of interest holders arising from the purchase and sale of securities. Impaired - No distribution. Class 5 - All interest holders in the debtor. Impaired - Terminated and canceled. As of December 1996 the debtor has ceased all business operations. PARAGON TRADE: Applies to Employ Special Counsel ------------------------------------------------ Paragon Trade Brands, Inc. applied to employ Baker & Botts as its special litigation counsel to represent Paragon in the pending action with Kimberly-Clark, and to coordinate with counsel in the action with the Procter & Gamble Co. The debtors are seeking the employ of this firm due to the firm's antitrust and discovery experience in Texas. Baker & Botts currently has unpaid invoices owing from Paragon totaling $20,500. The debtor is also seeking court approval for the employment of Cravath Swaine & Moore as its special counsel in the action with the Procter & Gamble Co. and in the action with Kimberly-Clark. Debtors are seeking the employ of this firm due to their knowledge and experience of patent law, antitrust law and federal appellate procedure. Paragon believes that this representation will be critical to the company's reorganization. Both firms will bill the debtor pursuant to their normal hourly rates. PARAGON TRADE: Needs Ongoing Utility Services --------------------------------------------- Paragon Trade Brands, Inc. as debtor, is requesting that the court enter an order determining adequate assurance of payment for future utility services and restraining utility companies from discontinuing, altering or refusing service. The debtor believes that its ongoing operations together with funds which will be available through its right to borrow funds pursuant to the DIP facility will provide sufficient cash to pay for the debtor's post-petition utility services on a current basis. The debtor is current on its payments for utility services and proposes an expedited review process whereby the utility companies could seek to modify the terms of this Order. SOURCECOM: Court Approves Settlement with Creditors --------------------------------------------------- Judge Kathleen T. Lax approved the Chapter 11 Trustee's motion to approve settlements with both of the estates' secured creditors in the matter of In re Sourcecom Corporation. Pursuant to the Settlement Agreement, secured creditors PairGain Technologies Inc. and Greyrock Business Credit agreed to reduce their secured claims by approximately $910,000 (to a total of $4.3 million) and to waive their unsecured claims. The Trustee for Sourcecom estimates that the net economic value of these settlements to the estate is approximately $1.2 million, and will increase the anticipated distribution to unsecured creditors to between 30% and 40%. The Trustee anticipates a proposal of a plan of liquidation by mid-February. STREAMLOGIC: Files Disclosure Statement and Plan ------------------------------------------------ The debtor, Streamlogic Corporation filed its first amended plan of reorganization dated January 15, 1998. The treatment of non-classified priority claims is to pay such claims in cash either in the amount of the claim or in the amount agreed to by the claimant and the debtor. Unimpaired claims are those priority claims in Class A - Priority Claims and Class B - Secured Claims. The debtor estimates that the allowed amount of Class A priority claims will be approximately $35,000. Class B secured claims filed by creditors are in an aggregate, approximate amount of $670,000. Impaired Classes are Class C Convenience claims who will receive 10% of any such allowed claim, subject to an opt- out and opt-in election. The debtor anticipates that holders of approximately 340 allowed claims, in an aggregate amount of approximately $360,000 will elect to be within Class C, and that the distributions therein will be approximately $34,000. Those amounts assume that holders of claims of up to $4000 will elect to reduce their claims to be within Class C. Class D consists of general unsecured claims which shall be paid on a pro rata basis. The debtor estimates that the aggregate amount of all allowed claims within Class D, including the Debentures and Notes, will be approximately $30 million. The debtor estimates that distributions upon allowed claims within Class D will be in an aggregate amount that is approximately 17.10 percent of the total amount of such allowed claims based upon the analysis set forth in the disclosure statement. Reorganized Shares of stock, when distributed, shall be deemed to have a value of $0.325 for purposes of calculating distributions upon and in satisfaction of allowed claims within Class D. Class E consists of all interest in the debtor, meaning all shares of the debtor's common stock and all options, warrants and other rights affecting the debtor's stock or equity interests. All existing shares of the debtor will be canceled and all option, warrants and other rights affecting such stock will be terminated. On the effective date of the plan, the debtor will be reorganized and will emerge from bankruptcy with an new capital structure and working capital which its management believes is sufficient to return the company to profitability, through support of tits hammer product line and related operations. TAL WIRELESS: Creditor Objects to Sale and Offers More ------------------------------------------------------ Creditor RDC Networks, Inc. objects to the motion to sell assets filed by the debtor, TAL Networks, Inc. RDC submits that it will match the present offer of Wireless Networks, Inc. to pay $4,000 upon the court's approval of RDC's offer; and RDC will double the amount per unit to be paid to the debtor for the first 1,000 units which incorporate any of the assets purchased from the debtor. RDC states that it is capable of manufacturing the Wireless Router; and that it would be extremely difficult for the debtor (or anyone else working with the Wireless Routers) to operate without RDC's support because RDC manufactured the core part of the Wireless Routers; and RDC actually manufactured a significant amount of the assets and is singularly capable of providing the requisite technical support. THE WIZ: Cablevision Electronics Poised for Purchase ---------------------------------------------------- The Wiz Inc., et al, debtors filed a motion on January 27, 1998 seeking authority to sell substantially all of the debtors' assets to Cablevision Electronics Investments Inc. and seeking authorization to conduct an auction on February 3, 1998. The purchase price for the business is $10 million (less Assumed Administrative expenses) plus the Inventory Amount (as defined in the Agreement). Cablevision will assume liabilities and the debtors will pay the cure amounts on all leases up to $2.227 million. A break-up fee of $2 million will be paid to Cablevision in the event that the sale does not close, as set forth in the Agreement. Overbids of Cablevision Electronics' bid must exceed the purchase price set forth in the Purchase Agreement by a minimum of $2.5 million, with successive bids for an increase of at least $500,000. WEINER'S STORES INC.: Unveils Post-Bankruptcy Capital Plan ---------------------------------------------------------- Weiner's Stores Inc. announces its plan to recapitalize business since emerging from Chapter 11 bankruptcy proceedings August 26, 1998. Weiner's Stores, Inc., a Delaware corporation, is a neighborhood family retailer of branded products for value-conscious customers. The company operates 128 stores located primarily in strip shopping centers in Texas and Louisiana. Weiner's has filed a Form 10-12G with the SEC to register common stock, par value $.01 per share. The Company is authorized to issue up to 50,000,000 shares of Common Stock and up to 10,000,000 shares of Preferred Stock. The capital plan is designed to allocate funds to open new stores, major remodels at stores, the maintenance and upgrading of existing locations and the replacement of management information systems and store point-of-sale systems. The Company expects to open 30 locations in existing and contiguous markets over the next five years. Weiner's expects to obtain the funds for such capital expenditures from operating cash flow and borrowings under the Credit Facility. The Credit Facility limits the Company's capital expenditures for 1997, 1998 and 1999 to $7,000,000 in each of those years, and $5,000,000 for the period from January 30, 2000 to August 31, 2000. There can be no assurances that the Company will have the resources to fulfill its capital plan. WESTMORELAND COAL: Court Deems Proof of Claim Filed on Time ----------------------------------------------------------- Judge Marcia S. Krieger has determined that the Commonwealth of Virginia, the Virginia Workers' Compensation Commission and the Uninsured Employer's Fund, on behalf of 261 Virginia Workers' compensation award claimants are deemed to have filed their proof of claims on time. WESTMORELAND COAL: Court Approves Attorney for Retirees ------------------------------------------------------- Judge Marcia S. Krieger has entered an order authorizing the Westmoreland Retired Salaried Employees' Committee to employ Wolf, Block, Schorr and Solis-Cohen LLP as counsel for the Committee. DLS CAPITAL: Bond pricing for week of January 26 ------------------------------------------------ Following are indicated prices for selected issues: Amer Telecasting 0/14 1/2 '04 27 - 29 APS 11 7/8 '06 40 - 43 (f) Boston Chicken 7 3/4 '04 64 1/2 - 65 1/2 Bradlees 11 '02 5 - 6 (f) Brunos 10 1/2 '05 44 - 46 CAI Wireless 12 1/4 '02 26 - 28 Cityscape 12 3/4 '04 45 - 48 Harrah's Jazz 14 1/4 01 31 - 33 (f) Hechinger 9.45 '12 75 - 77 Hill's 12 1/2 '03 83 - 84 Grand Union 12 '04 46 - 47 Great Bay 10 7/8 '04 82 - 84 (f) Levitz 9 5/8 '03 38 - 42 (f) Liggett 11 1/2 '99 66 - 69 Marvel 0 '98 4 3/4 - 5 Mobilmedia 9 3/8 '07 11 - 12 1/2 (f) Mosler 11 '03 78 - 82 Penn Traffic 9 5/8 '05 56 - 57 Royal Oak 11 '06 74 - 78 Trump Castle 11 3/4 '03 96 - 97 Wickes 11 7/8 '03 95 - 96 Grand Union bonds swooned 7 points as bankruptcy rumors circled. Royal Oak bonds recovered nicely after a bondholders' consent. --------- A listing of meetings, conferences and seminars appears every Tuesday. Bond pricing, appearing each Friday, is supplied by DLS Capital Partners, Dallas, Texas. S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter, co- published by Bankruptcy Creditors' Service, Inc., Princeton, NJ, and Beard Group, Inc., Washington, DC. Debra Brennan and Lexy Mueller, Editors. Copyright 1998. All rights reserved. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *