/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/980630.MBX T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, June 30, 1998, Vol. 2, No. 127 Headlines APS: Restructuring of Business Operations BLUE-N-GOLD BREWING: Case Summary & 20 Largest Creditors BOSTON CHICKEN: Negotiates with Senior Credit Facilities BOSTON CHICKEN: SEC Comments on Annual Report BRUNO'S: Quarterly Report for Period Ended May 2, 1998 CAJUN ELECTRIC: Co-ops Differ on Judge's Decision DAI-ICHI CORP: To Liquidate DOEHLER-JARVIS: Liquidation of Harman Automotive DOEHLER-JARVIS: Seeks Extension to Assume or Reject Leases GAYLORD: Bookstore Debtors Extend Use of Cash Collateral GAYLORD: Date Set for Cookstore Confirmation Hearing GEOTEK COMMUNICATIONS: Files for Voluntary Chapter 11 KIA MOTORS: Auction May Wipe Out Ford's Share LEVITZ: Committee Responds to Extension of Exclusivity LONG JOHN: $65 Million Chase-Led DIP Facility Approved LONG JOHN: Franchisees Urge Appointment of Separate Committee MAXICARE HEALTH: Heartland Advisors Reports Stock Ownership MAXICARE HEALTH PLANS: Net Loss of $2.7 Million MERRY-GO-ROUND: Ernst & Young Going to the Jury MOBILEMEDIA: Court Extends Solicitation Period PAN AM: $24.5 Million Plan Confirmed RDM SPORTS: MetroMedia Gets to Fund Avoidance Litigation RENAISSANCE COSMETICS: Reports Disappointing Year SANYO SECURITIES: Plans to Halt Business SAUER INC: Reports Sales SPECTRUM INFORMATION: Reports Financial Results SUNBEAM: Confirms SEC Probe UNION COUNTY UTILITIES: PSE&G and UCUA Announce NUG Buydown VENTURE STORES: Sale of Paper to Norkol, Inc. VENTURE STORES: Committee Seeks Investigation of Officers WESTERN DIGITAL: Completes Revised Credit Agreement Meetings, Conferences and Seminars ********* APS: Restructuring of Business Operations ----------------------------------------- APS Holding Corporation announced that it is undertaking a restructuring of its business operations. In addition to the 32 company-owned stores closed during the first quarter, the Company intends to close approximately 115 additional under performing company-owned stores and Installers' Service Warehouse (ISW) units during the second quarter, for a total of approximately 145. In conjunction with these closings, as previously announced in mid-April, the Company has closed its Seattle distribution center, which had never been profitable. In addition, the St. Louis and Tulsa distribution centers have been converted to redistribution centers to help facilitate the Company's operational restructuring. APS has also begun a program to integrate its remaining ISW operations into the Big A company store framework under the Big A Express banner over time. This transition will take place during the remainder of 1998. Day-to-day responsibility for the combined company-owned store operation is now under the direction of Mike Preston, Senior Vice President. (APS Bankruptcy News 26-June-98) BLUE-N-GOLD BREWING: Case Summary & 20 Largest Creditors -------------------------------------------------------- Debtor: Blue-N-Gold Brewing Company 3100 Clarendon Boulevard Arlington, VA 22201 Court: Eastern District of Virginia, Alexandria Division Case No.: 98-80054 Filed: 06/12/98 Chapter: 11 Debtor's Counsel: Kermit A. Rosenberg Holmes, Rosenberg & Doherty, P.C. 2020 North 14th Street, Suite 410 Arlington, VA 22201-2515 (703) 526-0300 Total Assets: $2,000,000 Total Debts: $3,770,784 Debt Securities held by more than 500 holders: Secured $449,532 Unsecured $3,315,691 No. of shares of common stock - 100 1 holder 20 Largest Unsecured Creditors: Name Nature Amount ---- ------ ------ Metropolitan Airport Authority Trade 450 Martin Seafood Trade 1,674 Complete Building Services Trade 2,909 Merripark Limited Rent 12,954 Bernstein Management Corp Rent 14,055 SI Clarendon, Inc. Rent 75,000 BOSTON CHICKEN: Negotiates with Senior Credit Facilities -------------------------------------------------------- Boston Chicken is currently negotiating the terms of a credit facility with the Bank of America National Trust and Savings Association as agent and participant under Boston Chicken's $85 million 1996 revolving line of credit and with General Electric Capital Corporation as agent and a participant under its 1996 Master Lease Agreement. Boston Chicken anticipates that such senior lenders and certain other participants in the 1996 Credit Facility would extend to Boston Chicken an approximately $37 million revolving line of credit expected to mature in late October 1998. BOSTON CHICKEN: SEC Comments on Annual Report --------------------------------------------- Boston Chicken received a letter from the staff of the Division of Corporation Finance of the Securities and Exchange Commission containing comments of the SEC Staff regarding Boston Chicken's Annual Report on Form 10-K for the fiscal year ended December 28, 1997 including certain portions thereof that were incorporated by reference from Boston Chicken's definitive proxy statement, dated April 13, 1998, as supplemented, for its 1998 Annual Meeting of Stockholders. On May 28, 1998, counsel to Boston Chicken submitted a letter to the SEC Staff responding to its comments, in which letter Boston Chicken has agreed to make additional disclosure in the Form 10-K. Boston Chicken believes such agreed additional disclosure does not represent a material change from its existing disclosure and so will include it in an amended Form 10-K to be filed by Boston Chicken at such time as Boston Chicken and the SEC Staff reach agreement with respect to all of the SEC Staff's comments. As of June 25, 1998, Boston Chicken had been informed by the SEC Staff that it would have additional comments in response to Boston Chicken's letter of May 28, 1998, as well as related comments on Boston Chicken's Quarterly Report on Form 10-Q for the quarterly period ended April 19, 1998 and Boston Chicken's Current Reports on Form 8-K dated May 19, 1998 and June 16, 1998. However, Boston Chicken has not yet received the formal comments from the SEC Staff. Boston Chicken intends to submit promptly a letter to the SEC Staff responding to any additional comments that are received by Boston Chicken. The comments made by the SEC Staff with respect to the SEC Documents may have a number of effects on Boston Chicken, including, for example: (i) until such comments are resolved with the SEC Staff, Boston Chicken will not be able to cause the shelf registration statement that is required to be filed with respect to the preferred stock and common stock of Boston Chicken to be issued to the holders of interests in BCEF and Market Partners to become effective; (ii) until such comments are resolved with the SEC Staff, Boston Chicken may experience delays to other transactions involving Boston Chicken that are subject to review by the Securities and Exchange Commission, including any proposed restructuring of Boston Chicken's outstanding classes of publicly traded subordinated debt; and (iii) any material additional or restated disclosure may have an effect on the progress or outcome of the current securities class action litigation against Boston Chicken and certain other persons. BRUNO'S: Quarterly Report for Period Ended May 2, 1998 ------------------------------------------------------ The Debtor filed its quarterly report on Form 10-Q with the Securities and Exchange Commission, reporting an $11,353,000 net loss on $501,729,000 in sales for the 13- week period ending May 2, 1998. A full-text copy of the filing is available at no charge via the Internet at: http://www.sec.gov/Archives/edgar/data/14920/0000950144-98- 007459.txt CAJUN ELECTRIC: Co-ops Differ on Judge's Decision -------------------------------------------------- Rural cooperatives that provide electricity to nearly 1 million Louisianians remain sharply divided over a federal judge's decision to cancel Southwest Electric Power Co.'s bid to buy Cajun Electric Power Cooperative Inc. out of bankruptcy. Eight cooperatives say they will continue to support SWEPCO and will back an appeal of U.S. District Judge Frank Polozola's ruling. Polozola ruled SWEPCO illegally paid $1 million last year to "lock in" the votes of seven cooperatives for SWEPCO's bid. But three other cooperatives, including Pointe Coupee Electric Membership Corp., have endorsed other bidders. Jimmy Ewing, president of Pointe Coupee's board of directors, said Polozola issued a "straightforward" ruling after studying the case carefully. "That $1 million in essence bought the hearts and minds and souls of the professionals in this case," said Ewing. Ewing said the payment, first offered behind the scenes in November 1996, influenced attorneys and managers of the seven cooperatives, pushing them to stick with SWEPCO and shun negotiations with other bidders. The payment has delayed a solution to the bankruptcy, Ewing said, making it impossible for the cooperatives' customers to benefit from the lower electric rates that he said would come with approval of any of the three bids. The bids were made by SWEPCO, Houston-based Enron Corp. and a partnership led by Southern International Energy of Atlanta. But John Sharp, attorney for the seven cooperatives, denied the $1 million payment had any influence. Legal fees in the bankruptcy so far have probably mounted to more than $40 million, he said. "The idea that $1 million is going to buy anybody's heart and soul is ridiculous," he said. "The $1 million was nothing more than one partner in a business venture assisting another partner in a business venture." The controversial payment stemmed from a Jan. 9, 1997, letter by SWEPCO attorney Bobby Gilliam offering to pay $1 million for legal expenses of the group of seven cooperatives. Gilliam included a condition requiring cooperatives to repay the money if they endorsed the plan proposed by another company. The cooperatives agreed with the condition and received $1 million. The trustee overseeing Cajun later complained along with other parties in the case that the payment was improper and was kept secret from them until April 1997, when a cooperative official by chance disclosed it. Polozola, in a hearing June 16, ruled the payment was an illegal secret attempt to "lock in" the votes of the cooperatives, which had voted for SWEPCO's plans in December 1996. Polozola ordered the seven cooperatives to repay the money by June 30, and he referred the matter to federal prosecutors for investigation. On Friday, Polozola denied a request by SWEPCO to stay his order while SWEPCO appeals to the U.S. 5th Circuit Court of Appeals in New Orleans, said David Rubin, attorney for the trustee in the case. At the outset of the bankruptcy in 1994, the state had 12 rural cooperatives, which were owned by their members or customers. The cooperatives in turn owned Cajun and bought their power through it. At first, 10 cooperatives supported SWEPCO's bid to buy Cajun out of bankruptcy. One cooperative, Claiborne Electric, did not join the committee of cooperatives backing the bid. Another cooperative, which was sold to an investor-owned utility, has expressed no preference among the three bidders. Then, beginning in late 1996, Pointe Coupee and two other cooperatives dropped their support of SWEPCO and reached agreements with the other bidders. On Friday, the two other cooperatives - Southwest Louisiana Electric Membership Corp. (SLEMCO) in Lafayette and Concordia Electric Cooperative in Jonesville - said Polozola was "unequivocally correct." "The Cajun bankruptcy case has lingered way too long and is mainly damaging to the nearly 400,000 electric cooperative customers in the state," said George Fawcett, SLEMCO's director of marketing. "This entire matter needs to move forward as quickly as possible to a conclusion." Claiborne Electric attorney Patrick Henry said the cooperative will support SWEPCO's appeal, and doesn't think the $1 million payment was an attempt to buy the cooperatives' votes. The Louisiana Public Service Commission has said the rates proposed under all three plans - which would cut Cajun's current rates by roughly 10 percent - are "not presumptively unreasonable." SWEPCO's rate would cost all of the cooperatives $300 million less than the two other bidders' rates over 25 years, Locklar said, citing a study by Dixie consultants. Dixie, which got more than $360,000 of the SWEPCO payment, will be able to repay the money by June 30, he said. He said Cajun went into bankruptcy because of bad planning over the costs for the River Bend nuclear power plant, and he is worried similar problems may arise if the cooperatives don't fight for the lowest rates possible. (Advocate Baton Rouge - 6/27/98) DAI-ICHI CORP: To Liquidate --------------------------- According to a private credit research company, Daiichi Corp., a non-banking financial institution that announced a restructuring plan in April, applied for special liquidation proceedings with Tokyo District Court on June 26. It currently has as much as 413.5 billion yen in liabilities. (Tokyo Financial Wire-06/29/98) DOEHLER-JARVIS: Liquidation of Harman Automotive ------------------------------------------------ Harman Automotive, Inc. one of the debtors of Doehler- Jarvis, Inc. et al. seeks to implement a liquidation procedure designed to maximize the value of and return for the remaining Harman Assets. Harman proposes to dispose of the assets by engaging the services of National Industrial Services Incorporated, as liquidator and auctioneer. The Agreement guarantees that Harman will receive sales proceeds of $1.95 million form the Public auction of the Harman Assets. The debtor states that the liquidation is supported by Harman's sound business judgment and Harman seeks court authority to retain National Industrial Services, approving the liquidation procedures and authorizing the sale of the remaining Harman assets by Public Auction. DOEHLER-JARVIS: Seeks Extension to Assume or Reject Leases ---------------------------------------------------------- Doehler-Jarvis Inc. et al. seek entry of an order extending for a period of 60 additional days the time within which the debtors may assume to reject leases of nonresidential real property to which any of the debtors is a lessee. The debtors presently have 12 unexpired leases of nonresidential real property in 7 states. The leases constitute valuable assets of the debtors' estates. The debtors are presently in the process of negotiating the terms of a plan or plans of reorganization with the Creditors' Committee. In connection with the plan or plans, the debtors are evaluating their financial situation and the potential value of the leases and expect the plan or plans to address which of the leases they will assume and reject. The debtors expect to file a plan or plans of reorganization in the near term. GAYLORD: Bookstore Debtors Extend Use of Cash Collateral -------------------------------------------------------- On June 22, 1998 the court approved a supplement to the Stipulation and Agreed Order extending the bookstore Debtors' authority to use cash collateral entered June 15, 1998. The parties reached an agreement extending the use of the cash collateral of their secured lender Greenfield Commercial Credit, LLC through July 2, 1998 GAYLORD: Date Set for Cookstore Confirmation Hearing ---------------------------------------------------- July 10, 1998 is fixed as the date for the confirmation hearing on the Cookstore Debtors' Plan of Reorganization dated June 18, 1998. The Disclosure Statement is conditionally approved subject6 to final approval on July 10, 1998. GEOTEK COMMUNICATIONS: Files for Voluntary Chapter 11 ----------------------------------------------------- Geotek Communications, Inc. provider of mobile logistics systems, announced today that it and its domestic subsidiaries have filed voluntary petitions seeking protection under Chapter 11 of the Bankruptcy Code. The filing in the U.S. Bankruptcy Court in Wilmington, Delaware, together with $10.0 million in debtor-in- possession financing, will enable the Company to conduct its business while it attempts to negotiate a plan to reorganize with its major creditors and seek additional capital; or, in the alternative, to find a strategic buyer for its business. The debtor-in-possession financing agreement was filed with a term sheet for a Chapter 11 Plan of Reorganization prepared by the debtor-in- possession lender. Subject to court approval, Geotek expects to use all operating revenues from the continued sales of its communication systems and services, in addition to the $10.0 million debtor-in- possession commitment from S-C Rig Investments III, L.P., an affiliate of the Soros Group, to fulfill obligations associated with operating its business. Employees will receive salaries in the normal manner and benefits programs continue. As of March 31, 1998, Geotek Communications, Inc. had consolidated assets (unaudited) of approximately $351 million and consolidated liabilities (unaudited) of approximately $424 million. Geotek is a provider of mobile logistics systems in the United States. KIA MOTORS: Auction May Wipe Out Ford's Share --------------------------------------------- Ford Motor Co. may be forced to write off much of its 12-year investment in Kia Motors Corp. as the South Korean government prepares to clean up the insolvent auto manufacturer for an international sale. Kia will be put up for auction as early as the end of August, said Kang Bong Kyun, a senior presidential secretary for economic affairs. Before that occurs, the nation's third-largest automaker must reduce all or most of its capital to pare its debt, making Kia shares almost worthless. "Details of the capital reduction will be determined later, but it's only natural to reduce the existing capital of Kia Motors before the auction," Kang said. Resolving Kia's future is central to Korea's efforts to overcome its biggest financial crisis in four decades. The company's $10- billion collapse a year ago disrupted the banking system and helped spark foreign currency turmoil that left the country almost broke. In December, Korea turned to the International Monetary Fund for a record $60- billion bailout. Ford bought 10 percent of Kia in 1986 for $30 million and now owns about 9.4 percent of the company. Ford's Mazda Motor Corp. affiliate owns 7.0 percent of Kia. Kang said Ford will have the option of buying new shares at the auction if it wants to maintain its investment in Kia. (Detroit News-06/26/98) LEVITZ: Committee Responds to Extension of Exclusivity ------------------------------------------------------ The Official Committee of Unsecured Creditors of Levitz Furniture Incorporated, et al., responds to the motion of the debtor seeking a 90 day extension of the exclusive periods. The debtor agrees to a 60 day extension of the exclusive periods, and seeks court approval of only the 60 day extension. LONG JOHN: $65 Million Chase-Led DIP Facility Approved ------------------------------------------------------ Long John Silver's Restaurants, Inc., obtained final approval last week from the Federal court in Delaware of its $65 million debtor-in-possession financing facility led by Chase Manhattan Bank. LONG JOHN: Franchisees Urge Appointment of Separate Committee ------------------------------------------------------------- The United States Trustee for Region III has indicated a willingness to appoint an official committee to represent the interests of franchisees of Long John Silver's Restaurants, Inc. A consortium of franchisees argued that an official committee is needed because no franchisee-related interests are represented by the official creditors' committee. Franchisee and creditor interests, the Consortium asserted are "prone to come into conflict, particularly with respect to operational, executory contract, and, most importantly, plan issues." MAXICARE HEALTH: Heartland Advisors Reports Stock Ownership ----------------------------------------------------------- Heartland Advisors, Inc. amends its filing with the SEC relating to the Shares of Maxicare Health Plans, Inc. Heartland Advisors reports beneficial ownership of 3,577,400 shares of common stock, representing 20% of the class. The Heartland Value Fund, a series of Heartland Group, holds an aggregate of 1,631,400 Shares, which were purchased for cash in the amount of $28,376,164.81, including brokerage commissions. The Accounts own an aggregate of 1,946,000 Shares, which were purchased for cash, or on margin in accordance with margin agreements on industry standard terms, in the amount of $28,902,818.39, including brokerage commissions. MAXICARE HEALTH PLANS: Net Loss of $2.7 Million ----------------------------------------------- The Company reported a net loss of $2.7 million for the three months ended March 31, 1998 compared to net income of $.1 million for the same three month period in 1997. MERRY-GO-ROUND: Ernst & Young Going to the Jury ----------------------------------------------- U.S. District Court Judge J. Frederick Motz has affirmed a U.S. bankruptcy judge's ruling that a Baltimore Circuit Court jury should decide whether the accounting firm hired to revive Maryland-based retailer Merry-Go-Round Enterprises Inc. instead caused its collapse. Ernst & Young International Inc., facing a $4 billion fraud, negligence and malpractice case tied to its handling of Merry-Go- Round's Chapter 11 reorganization, had appealed the March ruling by U.S. Bankruptcy Judge E. Stephen Derby. The case has been assigned to Circuit Judge Kathleen O'Ferrall Friedman for a trial scheduled to start March 25, 1999. MOBILEMEDIA: Court Extends Solicitation Period ---------------------------------------------- The United States Bankruptcy Court for the District of Delaware extended MobileMedia's exclusive period during which to solicit acceptances of a plan of reorganization through July 31, 1998. The paging concern originally requested an extension to Sept. 30, but later reached an agreement with the creditors' committee and bank group, according to Federal Filings, Inc. MobileMedia has said it is still in talks concerning "material amendments" to its plan that "could involve the Debtors' emerging from Chapter 11 either as a stand-alone company or as part of a third-party business combination." PAN AM: $24.5 Million Plan Confirmed ------------------------------------ A U.S. Bankruptcy Court judge Monday confirmed a $24.5 million bankruptcy reorganization plan for Pan Am Corp. under which private rail company Guilford Transportation Services will acquire Pan Am's name and assets. The deal will allow Pan Am to pay back $20.5 million in cash to NationsBank Corp., its largest creditor. But there will be no money for shareholders of the carrier, which filed for Chapter 11 bankruptcy protection on Feb. 26. Judge A. Jay Cristol signed the confirmation after lawyers said objections from six creditors had been resolved with minor modifications. The new Pan Am Airlines Inc. will maintain the charter flights launched after the carrier shut down Feb. 27 and evaluate future expansion, including regular scheduled service. The carrier had about $94 million in debts and a book value of $70 million when it shut down. If a liquidation had gone through, many creditors would have been left with nothing. The plan calls for a $20.5 million payment to NationsBank, the biggest secured creditor, and $100 payments out of a $500,000 fund to anyone who paid cash for unused tickets. Lawyers and accountants will collect about $1.2 million for working on the bankruptcy case. Most others can expect to be paid only 5 cents on the dollar for their claims from the remaining pot of roughly $5 million. RDM SPORTS: MetroMedia Gets to Fund Avoidance Litigation -------------------------------------------------------- Metromedia International Group Inc. lost its bid to block RDM Sports Group, Inc.'s Chapter 11 Trustee and committees of unsecured creditors and bondholders from using $5.5 million of cash collateral to pursue causes of action against a host of parties, including General Electric Co., as well as to pay administrative costs and the trustee's fees and expenses. Following a June 17 hearing, the U.S. Bankruptcy Court in Newnan, Ga., overruled Metromedia's objection and authorized establishment of the cash collateral fund. RENAISSANCE COSMETICS: Reports Disappointing Year ------------------------------------------------- Renaissance Cosmetics Inc. announced its financial results for the fiscal year ended March 31, 1998 and authorization of a financial restructuring of the company's holding company obligations and equity interests. Concurrently, the company announced that the lenders to its operating companies had agreed to extend their financing commitments to June 1999 and increase the amount available to be borrowed under their $75.0 million revolving credit facility. The company stated that it was now confident that it would have sufficient liquidity to enable the company to execute the business plans of its operating subsidiaries and consummate its financial and operational restructuring. The company reported a net loss for its fiscal year ended March 31, 1998 of $197.4 million on net sales of $179.7 million. ("EBITDAI") for Fiscal 1997 were ($62.7) million; excluding restructuring charges and prior years' adjustments, EBITDAI was ($4.5) million. Terry Theodore, chairman of the company's board of directors, said "1997 was an extremely difficult and disappointing year for both Renaissance and the mass market fragrance industry. Norbert Becker, the company's chief executive officer, said, "We reduced our consolidated domestic payroll by approximately 20%, and in the process streamlined our operations so that we can respond more efficiently to market conditions and customer needs. With the operational restructuring well underway, we have begun contacting our principal holding company constituents and will shortly commence discussions on a financial restructuring plan to put the Company on firm financial footing. Steps taken in the operational restructuring include focusing efforts on the company's core fragrance brands, consolidating organizational and management structures and reducing operating expenses by closing facilities and eliminating unprofitable products. Renaissance Cosmetics has outstanding $200 million principal amount of 11.75% Senior Notes due 2004, and the company expects that it will not make the semi-annual interest payment on the Senior Notes due on Aug. 15, 1998. The company is the holding company for several operating companies and businesses, including Dana Perfumes Corp., Cosmar, Tinkerbell, Nat Robbins Cosmetics and the Fetish line of fragrances, cosmetics and nail products. SANYO SECURITIES: Plans to Halt Business ---------------------------------------- The Japanese brokerage Sanyo Securities Co. has abandoned restructuring efforts and plans to halt its business. But the securities company is still negotiating a possible buyout with a foreign financial company. Sanyo disclosed Wednesday that it has given up on restructuring but refused to name the company in the possible buyout. Sanyo applied for court protection from creditors last November as it sought to rebuild its operations under a corporation rehabilitation law. "From now on we'll focus on liquidation, although we've put all efforts on reconstruction since November," said Akira Fujishima, trustee for the brokerage. If no agreement is reached with the unnamed foreign financial suitor by August, Sanyo will likely dissolve the business by the end of that month, Fujishima said. SAUER INC: Reports Sales ------------------------ Net sales for first quarter 1998 of $152.9 million increased by $17.0 million, or 12.5% from first quarter 1997 net sales of $135.9 million. SPECTRUM INFORMATION: Reports Financial Results ----------------------------------------------- Spectrum Information Technologies, Inc. announced financial results as reported in its Annual Report on Form 10-K for the Fiscal Year Ended March 31, 1998 as filed with the Securities and Exchange Commission. Spectrum also reported that it is actively seeking to raise capital to implement its business strategy. For the fiscal year ended March 31, 1998, Spectrum reported a net loss of $3.1 million, or $2.33 per share, compared to a net loss of $6.2 million, or $6.04 per share, for the previous fiscal year. The reduction in net loss is primarily attributable to $2.3 million in Chapter 11 administrative expenses that the Company incurred in fiscal 1997 as part of its reorganization that were not incurred during the fiscal year reported. Spectrum reported $1.8 million in revenues for the fiscal year ended March 1998 versus $1.9 million for the fiscal year ended March 1997, and operating loss of $3.2 million for the fiscal year reported, compared to an operating loss of $4.0 million for the previous year. All of the Company's revenues were related to its patented cellular data technology, not its Internet service. In a separate release, Spectrum announced that it has hired James G. Moore, formerly Director of Network Operations and Internet Services with Prodigy Services Company, to manage the day to day operations of the FastLane Web Acceleration and to help design and manage its deployment. SUNBEAM: Confirms SEC Probe --------------------------- Sunbeam Corp., the maker of home appliances and outdoor products that earlier this month fired its controversial CEO, said on Thursday the Securities and Exchange Commission is investigating its accounting policies. Sunbeam also said it is seeking waivers on certain loan covenants on $1.7 billion worth of loans and is continuing a review of issues surrounding its 1997 financial statements. The underwriters of the loans are Morgan Stanley Dean Witter & Co., BankAmerica Corp. and First Union Corp., which were part of Sunbeam's restructuring program completed last March. Sunbeam's stock has been in a steep decline since mid- March, when the company warned its first-quarter revenues would fall short of expectations. It subsequently fired the head of its consumer products division, posted a first- quarter loss of $44 million and announced a restructuring that involved closing eight plants and eliminating 5,100 jobs, or a third of its work force. UNION COUNTY UTILITIES: PSE&G and UCUA Announce NUG Buydown ----------------------------------------------------------- Public Service Electric and Gas Company (PSE&G) and the Union County Utilities Authority (UCUA) today announced that they have agreed to amend their Power Purchase and Interconnection Agreement (commonly referred to as Non- Utility Generation, or NUG contract) originally signed in 1990. Under federal and state regulations, utilities have been required to enter into long-term power purchase agreements with NUGs at above-market prices. Under the terms of the agreement, PSE&G will pay UCUA a lump sum amount of $7.75 million in exchange for a $24.4 million reduction in the prices paid for energy and capacity over the remaining life of the 20-year contract and give UCUA significant flexibility to market its power in a newly deregulated market. The UCUA will use the $7.75 million as part of a debt restructuring of its resource recovery facility, which is facing financial difficulties as a result of recent court decisions that stopped county agencies from directing municipal solid waste to the facility. "We are working hard to mitigate the impact of above-market NUG contracts on our customers," said Colin Loxley, director resource planning for PSE&G. "This agreement is a true win-win situation. Since all of the costs are borne by our customers, all of the savings will be passed on to them as well. Moreover, the UCUA is given an additional tool in dealing with its financial needs." "This agreement helps the UCUA solve its current financial problems and reduces the pressure on the county's taxpayers," said Joseph Spatola, Ph.D., executive director, UCUA. "This agreement gives the UCUA a $7.75 million payment in the face of considerable risk, while also leaving us flexibility to benefit further in the open electric market," added Spatola. The agreement also settles a dispute between PSE&G and the UCUA regarding the impact of PJM's restructuring on existing pricing mechanisms. Under the original agreement, which expires in April 2013, PSE&G was to pay 110% of the PJM billing rate and a capacity rate set annually by PJM (the PJM Capacity Deficiency Rate). Under the agreement announced today, energy prices will be based on PSE&G's zonal locational marginal price and capacity rates will be fixed for 3 years and then set by market-based rates. The New Jersey Board of Public Utilities must approve its terms. PSE&G and UCUA indicated in the agreement that if the BPU does not grant its approval within 90 days, either party has the option to withdraw it. VENTURE STORES: Sale of Paper to Norkol, Inc. --------------------------------------------- Subject to higher and better offers, the Debtor proposes to sell approximately 1,400 short tons of "Super calendered A & B grade paper" inventory to Norkol, Inc., for $700,000 on an "as it, where is" basis. Norkol has agreed to pick-up all of the paper inventory from the Debtor's printers and pay all transportation and removal costs. Additionally, Norkol will assume all risks of loss from the Closing through the pick-up time. VENTURE STORES: Committee Seeks Investigation of Officers --------------------------------------------------------- The Official Committee of Unsecured Creditors has advised the debtor, Venture Stores, Inc. that it believes an investigation of the acts and conduct of the officers and directors of the debtor is necessary relating to the sale leaseback transactions with Kmart and all matters arising from the transactions. The Committee asserts that the debtor has conflicts of interest that prevent it from conducting such investigation. The debtor agrees to cooperate in all aspects of the investigation. WESTERN DIGITAL: Completes Revised Credit Agreement --------------------------------------------------- Western Digital has completed negotiations of the terms of its bank credit agreement and confirmed that the company is in compliance with all the credit agreement's covenants. Earlier this month, the company announced that an expected loss in the fourth fiscal quarter ended this month would result in a technical default under its bank credit line. Senior vice president and chief financial officer Duston W. Williams said today that under the new terms no technical default would occur. Western Digital has $200 million available under its bank credit agreement and $50 million currently outstanding in the form of a term loan. The Company said it expects to have more than $425 million in cash on its balance sheet at the fiscal year ending June 27, 1998. Meetings, Conferences and Seminars ---------------------------------- July 2-5, 1998 NORTON INSTITUTES ON BANKRUPTCY LAW Western Mountains Bankruptcy Law Institute Jackson Lake Lodge, Jackson Hole, Wyoming Contact 1-770-535-7722 July 16-19, 1998 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Sea Crest Resort, Falmouth, Massachusetts Contact: 1-703-739-0800 July 23-24, 1998 THE PRACTICING LAW INSTITUTE How to Handle Consumer Bankruptcy Cases: A Practical Step-by-Step Guide PLI Conference Center, New York City Contact: 1-800-260-4PLI July 23-25, 1998 AMERICAN LAW INSTITUTE-AMERICAN BAR ASSOCIATION Chapter 11 Business Reorganizations (Advanced Course) Santa Fe, New Mexico Contact: 1-800-CLE-NEWS July 24-27, 1998 NATIONAL ASSOCIATION OF CHAPTER 13 TRUSTEES 33rd Annual Seminar Portland Marriott, Portland, Oregon Contact: 1-601-355-6661 July 24-29, 1998 COMMERICAL LAW LEAGUE OF AMERICA 104th Annual Convention Ritz Carlton, Amelia Island, Florida Contact: 1-312-781-2000 August 6-9, 1998 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop Daufuskie Island Club & Resort, Hilton Head, South Carolina Contact: 1-703-739-0800 September 9-13, 1998 NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES Annual Convention Sheraton El Conquistador, Tuscon, Arizona Contact: 1-803-252-5646 September 17-20, 1998 AMERICAN BANKRUPTCY INSTITUTE Southwest Bankruptcy Conference The Inn at Loretta, Santa Fe, New Mexico Contact: 1-703-739-0800 September 17-20, 1998 COMMERCIAL LAW LEAGUE OF AMERICA Midwest Mid-Year Meeting Oak Brook Hills Resort & Hotel Oak Brook, Illinois Contact: 1-616-372-6500 September 21-23, 1998 STATES' ASSOCIATION OF BANKRUPTCY ATTORNEYS 7th Annual States' Taxation and Bankruptcy Conference Hotel Santa Fe, Santa Fe, New Mexico Contact: 1-505-827-0728 September 25-26, 1998 VIRGINIA CONTINUING LEGAL EDUCATION 13th Annual Mid-Atlantic Institute on Bankruptcy and Reorganization Practice Boar's Head Inn, Charlottesville, Virginia Contact: 1-800-979-8253 October 8-10, 1998 AMERICAN LEGAL INSTITUTE-AMERICAN BAR ASSOCIATION Real Estate Defaults, Workouts, and Reorganization Charleston, South Carolina Contact: 1-800-CLE-NEWS October 16-20, 1998 TURNAROUND MANAGEMENT ASSOCIATION 1998 Annual Conference The Westin Hotel, Chicago, Illinois Contact 1-312-857-7734 October 22-25, 1998 NATIONAL CONFERENCE OF BANKRUPTCY JUDGES 72nd Annual Meeting Wyndham Anatole Hotel, Dallas, Texas Contact 1-803-957-6225 November 30-December 1, 1998 RENAISSANCE AMERICAN CONFERENCES & BEARD GROUP, INC. 5th Annual Conference on Distressed Debt Plaza Hotel, New York, New York Contact 1-903-592-5169 or ram@ballistic.com December 3-5, 1998 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Westin La Paloma, Tuscon, Arizona Contact: 1-703-739-0800 February 18-21, 1998 COMMERICAL LAW LEAGUE OF AMERICA Annual Western District Meeting Monte Carlo Hotel & Casino Resort, Las Vegas, Nevada Contact 1-702-382-9558 April 26-27, 1999 RENAISSANCE AMERICAN CONFERENCES & BEARD GROUP, INC. Bankruptcy Sales, Mergers & Acquisitions The Mark Hopkins, San Francisco, California Contact 1-903-592-5169 or ram@ballistic.com ********* The Meetings, Conferences and Seminars column appears in the TCR each Tuesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. 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. 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