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/raid1/www/Hosts/bankrupt/TCR_Public/980817.MBXT R O U B L E D C O M P A N Y R E P O R T E R Monday, August 17, 1998, Vol. 2, No. 160 Headlines AHERF: Sales of Hospitals Won't Provide Enough Money AVATEX: Announces Fiscal 1999 First Quarter Results BUCYRUS INTERNATIONAL: Files Quarterly Report With SEC CONSOLIDATED STAINLESS: Reports Second Quarter Results COUNTY SEAT: New Management Adds New Design and Merchandise COVENTRY HEALTH CARE: Reaches Agreement with Banks FPA MEDICAL: Key Employee Retention Program FPA MEDICAL: Rejection of Leases FPA MEDICAL: Debtors Tap Richards, Layton And Finger FASTCOMM COMMUNICATIONS: Reports Financial Results GLOBAL MOTORSPORT: Extends Tender Offer HOMEPLACE STORES: Notice of Bar Dates INTEGRATED PACKAGING: Reports $21.9 Million Loss LEVITZ FURNITURE: Seeks Agreement With Household Bank LONG JOHN SILVER'S: Key Employee Retention Plan MEDICAL RESOURCES INC: Reports Stock Ownership MIDCOM COMMUNICATIONS: Committee Seeks Settlement NATIONAL RECORD MART INC.: Files Quarterly Report with SEC NEWMONT MINING: Files Quarterly Report With the SEC RAYTECH CORP: Announces Positive Results REGENCY HOMES: Sale Negotiations Collapsed Before Filing ROSS TECHNOLOGY: Fiscal 1999 First Quarter Results SHOWA PLASTICS: Goes Under With Debts of 18 Bil. Yen THE PHONE COMPANY: Case Summary & 20 Largest Creditors THREE D DEPARTMENTS: Receives Up to $10M Financing Facility WESTERN DIGITAL: Files Prospectus With SEC ********* AHERF: Sales of Hospitals Won't Provide Enough Money --------------------------------------------------- The Pittsburgh Post-Gazette reported on August 13, 1998 that Pittsburgh-based Allegheny Health Education and Research Foundation and its Eastern Pennsylvania affiliates will not clear enough proceeds from the sale of nine Philadelphia-area hospitals to come close to paying off its estimated $1.3 billion pile of debt. Under a best-case scenario, in which a bidding war assures top dollar for the Philadelphia hospitals, it's likely that AHERF creditors holding $1.1 billion of debt will get back about $597 million - or roughly 54 cents on the dollar. A worst-case scenario puts the payback at about 32 cents on the dollar. The optimistic scenario assumes that $200 million of loans to the eastern hospitals from Allegheny General and AHERF's other western hospitals will be forgiven; that buyers of the Philadelphia hospitals will pay $555 million for all of them, or a generous $50 million more than what bidders have offered so far; and that the sale of a suburban New Jersey hospital, Rancocas, gets included in the proceeds, even though it's not included in the Chapter 11 bankruptcy filing. Further, the 54-cents-on-the-dollar estimate assumes that creditors successfully reclaim $147 million of payments made by the bankrupt affiliates in anticipation of the filing, roughly offsetting $100 million of financing AHERF and its affiliates have received to continue operations during bankruptcy; and that legal and other professional fees total no more than $5 million. Lastly, it also assumes that $1.3 billion is an accurate accounting of debts owed to at least 89,000 creditors. That estimate, from AHERF, already has come under challenge from major creditors. What won't happen, bankruptcy specialists and even AHERF creditors say, is that Vanguard Health System, Tenet Healthcare or any other potential buyer of the Eastern hospitals will agree to take on any old debts. Their goal is to get the operations debt-free so they can repair and run the hospitals without carrying the burdens of the past. That's a primary rule of any bankruptcy reorganization. AVATEX: Announces Fiscal 1999 First Quarter Results --------------------------------------------------- Avatex Corporation (NYSE: AAV), today announced financial results for the first quarter of fiscal 1999 ended June 30, 1998. Avatex reported revenues for the first quarter of $2.6 million compared to revenues of $3.2 million for the same period last year. The decrease is due to the sale of one of the Company's real estate partnership interests during the fourth quarter of fiscal 1998. The Company reported an operating loss of $1.2 million for the quarter, compared with an operating loss of $33.5 million a year ago. The prior year operating loss included a one-time charge of $33.3 million incurred in connection with the settlement reached with the Trustee of the Company's bankrupt subsidiary FoxMeyer Corporation. After preferred stock dividends of $6.8 million, the Company recorded a net loss to common shareholders of $9.4 million, or $0.68 per share, compared with a net loss to common shareholders of $43.1 million, or $3.12 per share, for the same period last year. The current year loss includes a reduction in the carrying value of the Company's investment in Imagyn Medical Technologies, Inc. of $1.9 million, while the prior year included a reduction of $5.2 million in the carrying value of Imagyn, the one-time charge discussed above and preferred stock dividends of $6.2 million. Avatex is a holding company that, along with its subsidiaries, owns interests in other corporations and partnerships. Through Phar-Mor, Inc., its 38% owned subsidiary, Avatex is involved in operating a chain of retail discount drug stores devoted to the sale of prescription and over-the-counter drugs, health and beauty aids and other general merchandise. BUCYRUS INTERNATIONAL: Files Quarterly Report With SEC ------------------------------------------------------ Bucyrus International Inc. reports a net loss for the quarter and six months ended June 30, 1998 of $293,000 and $9,362,000, respectively, compared with net earnings of $2,508,000 and $3,423,000 for the quarter and six months ended June 30, 1997, respectively. CONSOLIDATED STAINLESS: Reports Second Quarter Results ------------------------------------------------------ Consolidated Stainless Inc. Debtor-in-Possession (OTC BB:PIPEQ) announced results for its second quarter of 1998. Net sales declined 65.2% to $4.9 million for the three months ended June 30, 1998 from $14.0 million for the comparable period in 1997. A net loss of $2.6 million was incurred for the second quarter of 1998 as compared with a net loss of $0.7 million for the same period in 1997. On a per share basis, the net loss for the second quarter of 1998 was $0.57 as compared with a net loss of $0.15 for the three months ended June 30, 1997. "This second quarter loss was primarily due to the following factors: a decline in sales, reorganization costs associated with the company's Chapter 11 filing with the U.S. Bankruptcy Court in Delaware on December 15, 1997, and no income tax benefit for 1998," stated Ronald J. Adams, president. The company is in default of certain covenants included in its post-petition financing agreement. The lender may exercise its rights and remedies under this agreement including but not limited to, an immediate termination of the line of credit, foreclosure and taking possession of substantially all of the company's assets. While the lender has not at the present time chosen to seek such remedy, there is no guarantee that no such action will be taken. In separate motions, the United States Trustee and the Official Committee of Unsecured Creditors had moved the Bankruptcy Court for the appointment of a trustee to operate the company's business. A global settlement was reached which provided, among other things, that (1) an independent examiner would be engaged to perform an investigation limited to issues raised from an internal investigation report, review post-petition date insider transactions and post- petition date scrap sales, (2) a turnaround consultant would be retained as Co- Chief Executive Officer to assist in the operation and assessment of the company's business operations and (3) the Trustee and Committee motions would be dismissed. On June 10, 1998, Harvey B. Adams ("H. Adams") resigned as chairman of the board, chief executive officer and employee of Consolidated Stainless Inc. H. Adam's resignation was in response to a consensus of the board of directors, after considering among other things the position of the Official Committee of Unsecured Creditors of the company (in connection with its pending bankruptcy proceedings) and Mellon Bank (the lender for the company's current debtor-in- possession financing) as a necessary measure to assist the company in its reorganization efforts. Prior to H. Adam's resignation, Ronald J. Adams ("R. Adams") held the positions of president, chief operating officer and director of the company. R. Adams has now become the chairman of the board and, along with Vince Colistra (turnaround consultant with Phoenix Management Services Inc.), co-chief executive officer and co- president. Additionally, R. Adams remains the chief operating officer of the company. COUNTY SEAT: New Management Adds New Design and Merchandise ---------------------------------------------------------- In the Fall of 1996, things did look pretty bleak for County Seat, putting into jeopardy more than 8,000 retail jobs in every corner of the United States. The company went into bankruptcy, leaving in doubt the fate of some 750 stores and outlets. In early 1997, a new management team, led by veteran retail executive, Sam Forman, came in to save County Seat. He had turned around another well-known retailer, American Eagle Outfitters. The closed stores were primarily in the urban areas on the east and west coasts, leaving 413 stores spread thickly throughout the nation's heartland: the South, the Midwest, Texas, and the Rocky Mountain states. Many stores are improved with better lighting, different displays and promotions designed to draw customers inside. New floors and soothing color schemes highlight the apparel and all items are organized and displayed throughout to make the shopping experience more pleasant. In years past, County Seat's offering had become stale, leaning almost exclusively on sales of Levi's and other brand name clothes. The company's new managers saw that this was no way to attract new customers and certainly no way to help establish County Seat's new identity in the mall. The answer was a total revamp of the clothing assortment. The stores still carry Levi's, but more room is being made for a new line of private-label clothes that will appeal to an increasingly younger, more in-touch customer. (PRNewswire:WallStreet-08/13/98) COVENTRY HEALTH CARE: Reaches Agreement with Banks -------------------------------------------------- Coventry Health Care Inc., Bethesda, Md., announced yesterday that it has reached an agreement with Morgan Guaranty Trust Company of New York and NationsBank, N.A. resulting in a waiver of certain financial covenants in the company's $42.2 million bank loan agreement. In July, the company announced that, due to non-recurring charges taken in the second quarter, it was not in compliance with certain of the financial covenants in its bank credit facility and was negotiating with its lenders to amend the agreement to waive such non-compliance. The non-recurring pre-tax charges consisted of $7.8 million relating to the merger with Principal Health Care and $55.0 million associated with the Allegheny Health, Education and Research Foundation bankruptcy. (ABI 14-Aug-98) FPA MEDICAL: Key Employee Retention Program ------------------------------------------- The debtors, FPA Medical Management, Inc., et al., are seeking court authority for an employee retention program. The debtors believe that the program will encourage the Key Employees to remain in the debtors' employ by providing them with bonuses based on length of service and the debtors' successful reorganization. The purpose in providing retention bonuses to the Key Employees is to show them that they are valued by the debtors, and to reduce their concerns about unexpected layoffs. The C.E.O. of the debtors will be entitled to a stay bonus of 125% of base salary, each Executive Vice President will be entitled to a stay bonuses of 75% of base salary and the balance of the Key Employees will receive stay bonuses of between 25-50% of base salary. The total cost of the program is estimated to be $2,805,675. FPA MEDICAL: Rejection of Leases -------------------------------- FPA Medical Management Inc. is seeking authority to reject a certain Master Lease Agreement acquired from Foundation Health Systems and the fourteen leases covered therein. The locations of the property covered by the leases are all in California and Arizona. To assure a smooth transition of operations, the debtor and Foundation Health Systems have entered into an agreement to terminate the FPA-FHS Managed Care Operations. The debtors have determined that there is no interest in the leasehold interests worth preserving, and that the leasehold interests do not have any marketable value beneficial to the debtors' estates. The aggregate amount of monthly rental payments due pursuant to the leases is $228,000. The initial term of the Master Lease extends through December 31, 2000 with automatic extensions through December 31, 2026. The debtors believe that the rejection of the leasehold interests is in the best interest of their respective estates, creditors and other parties in interest. The rejections shall be deemed effective as of August 31, 1998. FPA MEDICAL: Debtors Tap Richards, Layton And Finger ---------------------------------------------------- The debtors FPA Medical Management Inc., et al., are seeking authority to employ and retain Richards, Layton And Finger, P.A. as special counsel for the debtors. The firm will be responsible to represent the debtors in those matters for which the debtors principal bankruptcy counsel, Skadden Arps, is precluded from representing the debtors' and to continue to represent the debtors in litigation commenced prepetition for which Richards Layton was previously retained and to provide the debtors with general corporate advice as Richards Layton has prior to the petition date. Richards Layton will apply for compensation for professional services rendered subject to approval of the court, on an hourly basis, plus reasonable expenses. The attorneys' hourly rates range from $340 per hour to $82 per hour for a paralegal. HOMEPLACE STORES: Notice of Bar Dates ------------------------------------- The U.S. Bankruptcy Court for the District of Delaware entered an order establishing September 21, 1998 as the general claims bar date in the Chapter 11 cases of HomePlace Stores, inc., HomePlace Stores Two, Inc., HomePlace Management, Inc., and HomePlace Holdings, Inc. FASTCOMM COMMUNICATIONS: Reports Financial Results -------------------------------------------------- FastComm Communications Corp. today reported financial results for the fiscal year ended April 30, 1998. Revenue was $8.9 million, down 21% from the $11.2 million for fiscal year 1997. Revenue for the fourth quarter ended April 30, 1998 was $3.3 million, down 3% from the 4th quarter of the prior fiscal year and up 59% sequentially from the third quarter of fiscal year 1998. The net loss for FY 1998 was $9.1 million ($.87 per share), compared to the FY 1997 loss of $595,000 ($.06 per share). The Company currently operates its business under the protection of a Chapter 11 petition of the Bankruptcy Code. FastComm Communications Corp. (FSCX) develops and markets advanced networking products for public and private digital networks. Its products include Frame Relay concentrators; FEP replacements; Voice and Data FRADs; WEB.routerTM Internet access routers; and T-1/E-1 ATM access equipment. In addition, FastComm offers Frame Relay line testers to speed installations; and the SuperViewTM intelligent data switch for remote management of multiple devices. GLOBAL MOTORSPORT: Extends Tender Offer --------------------------------------- Global Motorsport Group, Inc.(formerly Custom Chrome, Inc.) (NASDAQ:CSTM) announced that it has extended, at the request of Fremont Acquisition Company III, LLC, Global's previously announced tender offer to acquire up to 4,820,000 outstanding shares of its Common Stock (and associated rights) for $21.75 per share in cash. The tender offer is being made in connection with the previously announced definitive Merger Agreement with Fremont. The tender offer and withdrawal rights will now expire at 5:00 p.m., New York City time, on September 25, 1998, unless further extended. The extension of the tender offer is intended to provide additional time to satisfy the financing condition to the tender offer in view of current market conditions in the high yield debt securities market. The Company's depositary, American Stock & Transfer Company, has informed the Company that as of 4:00 p.m. EDT, Tuesday, August 11, 1998, 1,229,448 shares of Common Stock had been tendered, including shares tendered pursuant to a Notice of Guaranteed Delivery. This represents approximately 22.6% of the Common Stock outstanding. Global Motorsport Group was founded in 1970 and it is the parent organization for an international group of motorcycle aftermarket providers that focus their business on Harley-Davidson motorcycles sold worldwide. Global's organization includes Custom Chrome, the leading aftermarket supplier of Harley-Davidson motorcycle parts and accessories; Chrome Specialties, an aftermarket supplier of Harley-Davidson motorcycle parts and accessories located in Fort Worth, Texas; Custom Chrome Far East, a product development, engineering, tooling management and warehouse of proprietary products for Global, located in Taiwan; Custom Chrome Europe, a distribution company located in Germany that specializes in aftermarket accessories for Harley-Davidson motorcycles and other "cruiser" motorcycles; and Santee Industries, a manufacturer of frames and exhaust systems and other aftermarket components for Harley-Davidson motorcycles, located in California. INTEGRATED PACKAGING: Reports $21.9 Million Loss ------------------------------------------------ Integrated Packaging Assembly Corp., San Jose, Calif., reported a net loss of $21.9 million for the second quarter, ended July 5, compared to a loss of $6.1 million in the same quarter a year ago, according to The Wall Street Journal. The company also said it has stopped making debt payments and may have to cease operations. This year's loss included a one-time charge of $18.2 million for the write-down of impaired assets. The company is trying to renegotiate the terms of its debt and seek additional financing. (ABI 14-Aug-98) LEVITZ FURNITURE: Seeks Agreement With Household Bank ----------------------------------------------------- The debtors, Levitz Furniture Incorporated, et al., is seeking court authorization to enter into a merchant agreement with Household Bank (SB), N.A. The debtors currently run their credit sales through a private customer credit program with General Electric Capital Corporation. Since the petition date, the debtors' earnings under the GECC Agreement have decreased as a result of an increase in servicing fees and a decrease in approval rates for credit applications submitted to GE Capital for approval. The debtors expect that the agreement with Household Bank will generate increased revenues over the term of the agreement as well as providing a long-term reduction of net expenses. LONG JOHN SILVER'S: Key Employee Retention Plan ----------------------------------------------- Long John Silver's Restaurants, Inc., et al., is seeking an order authorizing key employee retention plans and severance agreements. The debtors seek to implement two separate key employee retention programs and reinstate severance agreements with the nine members of the debtors' CEO staff and the 19 members of the debtors' Executive Committee. The broad based retention plan covers a total of 346 employees including senior management and key field and corporate personnel. For the debtors' senior management the retention program would replace an existing retention program and would reduce the payouts to individual members of senior management. The total retention cost for the 346 employees is $8,250,200. The maximum potential payments under the revised severance agreements to the current CEO Staff, based on 200% of applicable base salaries, total $4,349,914. The maximum potential payments under the revised severance agreement to the members of the Executive Committee, based on applicable base salaries, total $4,995,582. The debtors will also provide outplacement services under the revised severance agreements, at a maximum total projected cost of $500,000. MEDICAL RESOURCES INC: Reports Stock Ownership ---------------------------------------------- Fir Tree, Inc., a New York corporation, doing business as Fir Tree Partners, and Mr. Jeffrey Tannenbaum, the sole shareholder, executive officer, director, and principal of Fir Tree Partners reports beneficial ownership of 2,861,000 shares of stock, representing 12.62% of the class. MIDCOM COMMUNICATIONS: Committee Seeks Settlement with Cherry ------------------------------------------------------ The Official Unsecured Creditors' Committee of Midcom Communications Inc. n/k/a MC Liquidating Corp., sees authority to settle an adversary proceeding with Cherry Communications Inc. Cherry Communications Inc. sued Midcom Communications Inc., prior to the bankruptcy of Midocom, seeking $16 million in damages for breach of contract. Litigation ensued, amd in connection with a sale of all of its assets to WinStar Communications, Midcom sold the right to any claim against Cherry. Cherry, the Committee, Midcom and WinStar have agreed to settle this proceeding by the disallowance of Cherry's claim and of Midcom's claim as offsetting claims and by the dismissal of this adversary proceeding and of the adversary proceeding pending in the Cherry bankruptcy case concerning Midcom's claim. NATIONAL RECORD MART INC.: Files Quarterly Report with SEC --------------------------------------------------------- The Company's net sales increased during the first quarter (ended June 27, 1998) of the Company's fiscal year ending March 27, 1999 by $3,422,287, or 16.3%, over the first quarter of fiscal 1998. Net comparable store sales for the first quarter were up 10.7% or $2,188,392. The increase in total sales is attributable to the 10.7% increase in same store sales and the opening of 20 stores, which was partially offset by the closing of 10 stores. The Company had a net loss of ($1,218,055), or ($0.25) per share, in the first quarter of fiscal 1999 compared to a net loss of ($907,815) or ($0.19) per share, in the same quarter of fiscal 1998. The increase in the net loss is primarily attributable to the costs associated with the opening and financing of 20 additional stores. NEWMONT MINING: Files Quarterly Report With the SEC --------------------------------------------------- Newmont Mining Corporation earned $25.7 million ($0.16 per share) and $56.5 million ($0.36 per share) in the quarter and six months ended June 30, 1998 compared with losses of $64.6 million ($0.41 per share) and $13.4 million ($0.09 per share) in the respective 1997 periods. Newmont's profitability is significantly affected by changes in the market price of gold. The decrease in consolidated sales revenue in the quarter and six months ended June 30, 1998 compared with the 1997 period resulted from a decrease in the average gold price received partially offset by increased production levels. Newmont increased production in the first six months of 1998 compared with the corresponding 1997 period by expanding its processing capabilities for refractory ores in Nevada and Minahasa and by increasing mining rates at Minera Yanacocha. RAYTECH CORP: Announces Positive Results ---------------------------------------- Raytech Corporation (NYSE: RAY) today announced net income for the thirteen-week period ended June 28, 1998 amounted to $5,817 or $1.70 per basic share as compared with $5,143 or $1.58 per basic share for the corresponding period in 1997. For the twenty-six week period, net income amounted to $9,511 or $2.81 per basic share compared with net income of $9,425 or $2.90 per basic share for the same period in 1997. The positive results are due to increased sales volume, improved gross margin and a lower effective tax rate partially offset by increased selling and interest expense. The decrease in basic earnings per share "EPS" is primarily due to the greater weighted average of stock options exercised during the period as compared to fiscal 1997. The effect of which diluted the weighted average shares used in the calculation of EPS. Net Sales Up 5.55% Net sales for the thirteen-week period ended June 28, 1998 increased 4.75% to $63,645 as compared with $60,760 for the same period one year ago. Net sales for the twenty-six week period ended June 28, 1998 increase 5.55% to $126,540 as compared with $119,881 for the same period one year ago. The improvement is due to additional sales volume within the domestic OEM market segment. Additionally, certain product lines within the aftermarket segment showed modest growth as the Company continues to increase market share. European sales increased by $2,082; however, due to adverse foreign currency fluctuation that was reduced to $200 for the period. Revenue increased by approximately $1.9 million as a result of the consolidation of Advanced Friction Material Company ("AFM"). Raytech Corporation previously owned a minority interest in AFM, which became a wholly-owned subsidiary during this quarter. The Company has been under the protection of the U.S. Bankruptcy Court relating to asbestos personal injury and environmental liabilities since March 1989. The ultimate liability of the Company with respect to asbestos-related, environmental or other claims cannot presently be determined. REGENCY HOMES: Sale Negotiations Collapsed Before Filing -------------------------------------------------------- A week before Regency Homes of Columbia, Md., filed for chapter 7 liquidation last month, it was on the verge of selling its assets to an Atlanta builder for $41 million, The Washington Post reported. When Regency shut down on July 30 it has assets of more than $50 million and liabilities of $53-$58 million. In its negotiations with Atlanta's Beazer Homes USA, Regency would have filed for chapter 11 reorganization. One of the major lenders involved was unwilling, however, to take the loss that would have been required to make the sale work, and the negotiations ended. The reorganization and sale would have enabled Regency to pay most of its secured debts. According to attorney Alan Grochal of Tydings & Rosenberg, Baltimore, this is the largest chapter 7 he has seen in 17 years, with 1,300 creditors. (ABI 14-Aug-98) ROSS TECHNOLOGY: Fiscal 1999 First Quarter Results -------------------------------------------------- ROSS Technology, Inc. (OTC Bulletin Board: RTEC) announced results for the first quarter, ended June 29, 1998, of its fiscal year. For the quarter the Company reported net sales of $7,833,000, compared to $11,813,000 in the first quarter of fiscal 1998; and a loss of $10,437,000 or $.44 per share, compared to a loss of $5,159,000 or $.22 per share in the first quarter of fiscal 1998. As previously reported, as a result of the Company's continuing and substantial economic deterioration, on June 1, 1998, the Company announced that it would commence an orderly shutdown of its operations. The decision was precipitated by a continuing decrease in revenues from the Company's sales of its 32-bit products. The Company intends to cease all of its operations by the end of calendar 1998. The Company has entered into an Asset Purchase Agreement to sell its manufacturing, sales and service operations and certain assets related to the Company's 32-bit hyper- SPARC(TM) business to a newly formed Texas corporation of which Joe Jones is president and a stockholder. The Asset Purchase Agreement provides an aggregate consideration of $5.66 million, of which $250,000 will be deposited by Buyer into an escrow account for an indemnification holdback amount to cover possible claims. Also, the Company will pay $1.72 million to the Buyer at the closing in consideration for the Buyer's assumption of and undertaking to pay, discharge and perform certain warranty repair liabilities of the Company. The Company has also entered into an agreement to sell all of the issued and outstanding stock of ROSS Semiconductors (Israel) Ltd. ("RIL") to Fujitsu Limited ("Fujitsu"), the holder of a majority of the outstanding shares of the Company's Common Stock and the holder of all of the outstanding shares of the Company's Series B Convertible Preferred Stock, for $2.5 million in cash, pursuant to a Share Acquisition Agreement, dated as of August 6, 1998, between the Company and Fujitsu (the "RIL Agreement"). In connection with the RIL Agreement, Fujitsu has agreed to retain RIL's employees. This transaction was consummated on August 10, 1998. Pursuant to an asset purchase and license agreement dated July 10, 1998, between the Company and Fujitsu, the Company has sold certain intellectual property rights to Fujitsu for $7.6 million (with a royalty-free license back to the Company for certain of those rights). The IP Sale was consummated on July 27, 1998. On July 22, 1998, the Company adopted a Plan of Complete Liquidation and Dissolution pursuant to which the Company will be liquidated by the sale of all or substantially all of its remaining assets and payment of claims, obligations and expenses owing to the Company's creditors. The BridgePoint sale and the Plan of Liquidation have been approved by Fujitsu, as holder of a majority of the outstanding shares of the Company's common stock and all of the outstanding shares of the Company's Series B Convertible Preferred Stock. The Company has filed a preliminary information statement with respect to the BridgePoint Sale and Plan of Liquidation with the SEC and will mail the information statement to its stockholders following the SEC's review and clearance of the preliminary information statement. The BridgePoint Sale will not be effective until at least twenty days after the mailing of the information statement and following satisfaction or waiver of the other conditions to that sale. On July 15, 1998, the Company received a notice from The Nasdaq Stock Market informing the Company that it no longer met the minimum net tangible assets requirement for continued listing on the Nasdaq National Market. The Company's common stock was delisted from the Nasdaq National Market effective at the close of business on July 31, 1998. The Company's Common Stock continues to trade on the over-the-counter bulletin board market maintained by The Nasdaq Stock Market. SHOWA PLASTICS: Goes Under With Debts of 18 Bil. Yen ---------------------------------------------------- Showa Plastics Co. effectively went bankrupt Friday when it filed for court-backed reorganization under the Japanese bankruptcy law. Showa Plastics, based in Habikino, Osaka Prefecture, and the parent company of Showpla Asia Ltd. listed on the Foreign Section of the Osaka Securities Exchange (OSE), said it has unsettled debts of 17.7 billion yen. The failure of Showa Plastics, which is known for its active business activity in Southeast Asia, came after it faced a liquidity crunch as a result of the Asian economic upheaval. The Osaka District Court, with which Showa Plastics applied earlier in the day for rescue under the Corporate Rehabilitation Law, said it appointed Osaka- based lawyer Takeo Mizuno to manage the company's assets. Showa Plastics, established in 1937, is capitalized at 300 million yen and has some 140 workers on its payroll. Showpla Asia, Showa Plastics' Singapore subsidiary, became the first foreign firm to be listed on the OSE's Foreign Section in August last year. (Kyodo News; 08/14/98) THE PHONE COMPANY: Case Summary & 20 Largest Creditors -------------------------------------------------- Debtor: The Phone Company 83 Wooster Heights Road Danbury, CT 06810 Type of business: Manufacturer of power supplies Court: District of Delaware Case No.: 98-1881 Filed: 08/12/98 Chapter: 11 Debtor's Counsel: Barry N. Seidel Sonnenschein Nath & Rosenthal 1221 Avenue of the Americas 24th Floor New York, N.Y. (212) 768-6700 20 Largest Unsecured Creditors: Name Amount ---- ------ ECI Telecom Inc. $1,060,036 AT&T Kansas $109,675 Vasilio & Company, Inc. $96,837 Teleport communications Group $46,543 Rosenman & Colin LLP $42,247 AT&T - TAT-12/13 $27,055 AT&T-910-2-52177 $20,770 Wells Fargo $18,239 Property Asset Management $13,842 Parwan Electronic Corporation $5,600 France Telecom $4,823 Forsgate Industrial Complex $4,194 Public Service Electric & Gas $4,130 Cosio Equipment Inc. $2,625 Bell Atlantic - NJ $2,425 Riker, Danzig Scherer, Hyland $1,750 Bell Atlantic Nynex Mobile $1,035 Anixter $889 Xerox Corporation $872 Federal Express $735 THREE D DEPARTMENTS: Receives Up to $10M Financing Facility ----------------------------------------------------------- Three D Departments, Inc. filed a voluntary petition for relief under Chapter 11. The existing directors and officers of the Company will continue to manage the operations of the Company subject to the supervision and orders of the Court. On July 30, 1998 the Company entered into a credit agreement with Foothill Capital Corporation, pursuant to which, among other things, Foothill has agreed to provide the Company with a financing facility in an aggregate principal amount not to exceed $10 million. The Court approved the Facility on an interim basis on August 6, 1998, thus allowing the Company to borrow up to $1 million under the Facility over and above the Company's existing liabilities under a prepetition credit agreement that provided for loans to the Company in an aggregate principal amount of $5 million. A final hearing on the full $10 million Facility is scheduled for August 21, 1998. WESTERN DIGITAL: Files Prospectus With SEC ------------------------------------------ Western Digital Corporation filed a Registration Statement regarding $1,297,200,000 principal amount at maturity of Zero Coupon Convertible Subordinated Debentures due 2018 and shares of the Company's Common Stock issued or issuable upon conversion of the Debentures. A full-text copy of the filing is available via the Internet at: http://www.sec.gov/Archives/edgar/data/0000892569-98- 002193.txt ********* 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. ISSN 1520-9474. 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 * * *