/raid1/www/Hosts/bankrupt/TCR_Public/981013.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, October 13, 1998, Vol. 2, No. 200
Headlines
APS HOLDING: Receives Court Approval For Sale
BOSTON CHICKEN: Oregon Franchisee Closes 56 Shops
CENDANT: Moody's Lowers Ratings
CITYSCAPE FINANCIAL: Preferred Shareholders Seek Examiner
CRIIMI MAE: Wechsler Harwood Announces Class Action
DOEHLER-JARVIS: Answers Objections to Plan
FIRSTMARK CORP: Final Settlement Near
HOMEPLACE STORES: Trying New Merchandising Concepts
INTERLINE RESOURCES: Restraints on Activities Removed
LACLEDE STEEL: Beneficial Ownership of Stock Reported
LOUISE'S TRATTORIA: First Amended Plan of Reorganization
MAGIC RESTAURANTS: Creditor Seeks Conversion to Chapter 7
ONCOR INC: Letter of Intent For Codon Withdrawn
ONCOR INC: Trading Halted in Common Stock
ONE-STOP WIRELESS: Seeks Order Setting Bar Date
PARADISE HOLDINGS: Judge Approves Sale To Original Owners
PINNACLE MICRO: Heads Off Bankruptcy
SOUTHERN PACIFIC: Class Actions Announced
SOUTHERN PACIFIC: Nationwide Crisis In Subprime Mortgages
STORMEDIA: Files Chapter 11 Petition
TOSHOKU AMERICA: Seeks To Consummate Sale
WINDSOR ENERGY: Final Order For Use of Cash Collateral
Meetings, Conferences and Seminars
*********
APS HOLDING: Receives Court Approval For Sale
---------------------------------------------
APS Holding Corporation announced that it has received
bankruptcy court approval for the sale of 10 distribution
centers and 148 company owned stores in three
separate transactions. The two largest of these
transactions were closed on October 9, 1998.
GPI, in the largest of the three transactions, has
purchased 8 distribution centers and 132 company-owned
stores. The distribution centers acquired by GPI
are located in Albuquerque, NM, Phoenix, AZ, Salt Lake
City, UT, Denver, CO, Great Bend, KS, Omaha, NE,
Indianapolis, IN and Winchester, VA. While most of
the stores acquired by GPI are located in these areas, the
company has also purchased certain stores in Arkansas,
Pennsylvania, Oklahoma and Texas. BWP has acquired APS'
Philadelphia, PA distribution center and 16 Big-A company-
owned stores serviced by this distribution center.
The third transaction, the sale of APS' Monroe, LA
distribution center to Rankin Automotive Group, Inc., is
anticipated to close within the next week.
"The proceeds from these three transactions, which total in
excess of $120 million, will be used to pay bankruptcy
court approved expenses associated with the assets sold and
to reduce the Company's bank debt," stated Bettina Whyte,
Chief Executive Officer of APS.
Customers in locations unaffected by the purchases will
continue to be served in the normal course. APS will
continue to operate 12 distribution centers and
approximately 200 company-owned stores under the Big-A and
Big-A Express banners. Additionally, APS will continue to
provide service to approximately 750 associated jobbers.
APS Holding Corporation is a national distributor of Big-A
brand and manufacturer branded automotive replacement
parts, as well as tools, equipment, supplies and
accessories.
BOSTON CHICKEN: Oregon Franchisee Closes 56 Shops
-------------------------------------------------
The local franchisee of Boston Chicken Inc. said
Sunday it has closed its 56 Boston Market restaurants in
Washington, Oregon and Idaho and laid off 900 workers.
The restaurants were closed Saturday night, the franchisee,
BC Northwest LP, said in a statement. Boston Chicken filed
for Chapter 11 bankruptcy last week after a series of
losses and amid heavy debts. "With the announcement by
Boston Chicken on Monday that it was no longer able to
provide financial assistance to BC Northwest, BC Northwest
determined that the continued operation of these
restaurants was impossible unless additional sources of
financing were available," BC Northwest said.
The company was unable to obtain financing from other
sources, BC Northwest said. BC Northwest said 36
restaurants in Washington, 17 restaurants in Oregon and 3
restaurants in Idaho were closed, adding it would provide
job search assistance for affected employees. BC Northwest
became a franchisee of Boston Chicken in 1994, opening its
first restaurant in the same year.
Boston Chicken said separately that the closing of the
restaurants will not affect the remaining 900 restaurants
or 18,500 employees in the chain. "As we said publicly
last week, it was our hope that BC Northwest would continue
to operate its restaurants, but as an independent and
separate company, BC Northwest had to make that decision,"
Boston Chicken Chairman J. Michael Jenkins said.
"It is unfortunate that for the time being, there will be
no Boston Market restaurants in those markets," he said.
CENDANT: Moody's Lowers Ratings
-------------------------------
Cendant Corp., a marketer and franchiser battered by
accounting fraud, received lower ratings from Moody's
Investors Service on $6.5 billion of its securities. The
rating firm blamed "financial and strategic challenges"
the company faces because of fraud and errors in a three-
year period.
CITYSCAPE FINANCIAL: Preferred Shareholders Seek Examiner
---------------------------------------------------------
Alleging fraud on the part of Cityscape Financial Corp. and
certain of its officers and directors, preferred
shareholders Elliott Associates L.P. and Westgate
International L.P. are seeking the appointment of an
examiner and deferral of the company's reorganization plan.
Opposed to the sub-prime mortgage lender's proposed
restructuring, Elliott and Westgate asserted that "these
chapter 11 cases are about diminution in value of the
Debtors and their estates caused by accounting
irregularities, other fraud and the financial and
operational ramifications as a result thereof." The series
B preferred shareholders want an examiner to probe:
(a) Cityscape's accounting irregularities;
(b) short sales of stock by current and former officers
and directors and/or the company's financial advisors; and
(c) potential claims against any officers and directors,
the financial advisors, or any other professionals.
A hearing on the matter is set for Oct. 15.(The Daily
Bankruptcy Review and ABI 12-Oct-98)
CRIIMI MAE: Wechsler Harwood Announces Class Action
---------------------------------------------------
Notice is given that on October 9, 1998, a securities class
action lawsuit was filed in the United States District
Court for the District of Maryland against certain officers
and directors of CRIIMI MAE, Inc, on behalf of purchasers
of the Company's securities at artificially inflated
prices between June 30, 1998 and October 5, 1998,inclusive.
The complaint charges that defendants issued a series of
materially false and misleading statements concerning the
Company's assets, earnings, and capital position. Because
of the issuance of a series of false and misleading
statements, the price of CMM securities was artificially
inflated during the Class period.
Plaintiffs seek to recover damages on their own behalf and
on behalf of all persons who purchased CRIIMI Mae's
securities. Plaintiffs are represented in this class action
by the New York law firm of Wechsler Harwood Halebian &
Feffer LLP, and Ronald B. Rubin, Chartered.
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP
among others also announces filing of a class suit.
DOEHLER-JARVIS: Answers Objections to Plan
------------------------------------------
Doehler-Jarvis, Inc., et al., debtor, filed a Memorandum of
Law in response to certain objections and in support of
confirmation of the debtors' first amended and modified
consolidated plan.
The debtor argues that the plan should be confirmed because
it complies with the confirmation standards set forth in
the Bankruptcy Code. The debtor states that the plan meets
the requirements for "cramdown" under the bankruptcy code,
and the debtor states that the objections to confirmation
are either without merit, do not relate to confirmation of
the plan or will be rendered moot by the court's entry of
the confirmation order.
FIRSTMARK CORP: Final Settlement Near
-------------------------------------
Leonard Rochwarger and his son Jeffrey, who controlled
Firstmark Corp. through the mid-1980s, have agreed to pay
$125,000 to settle the second-to-last claim in a class-
action lawsuit that alleged wide- ranging racketeering and
negligence. A final settlement for $65,000 with the
accounting firm Ernst & Young LLP is being readied and
could be filed within two weeks, attorneys said. All that
remains is approval from U.S. District Court Judge S. Hugh
Dillin, which could come by mid-December.
If agreed to by the court, some 3,000 noteholders
represented in the 1992 lawsuit brought by Virginia Brouwer
will have recovered just under $5 million from a dozen
defendants. The bankruptcy, filed Aug. 26, 1988, left the
noteholders with about $57 million in worthless paper. When
the bankruptcy closed in 1995, noteholders received about
17-1/2 cents on the dollar, or about $10.15 million.
A separate class-action lawsuit, covering about 300
noteholders, recovered nearly $3 million in settlements.
(Copyright UMI Company Indianapolis Business - 09/28/98)
HOMEPLACE STORES: Trying New Merchandising Concepts
---------------------------------------------------
HomePlace Stores Inc. of Valley View is in the process of
testing different merchandising concepts in an effort to
increase sales as it struggles to emerge from Chapter 11
bankruptcy proceedings. At least one concept is being
tested at the HomePlace store in North Olmsted at 25945
Brookpark Road, said Ann Julsen, a spokeswoman for the 3-
year-old housewares retailer.
"They are testing different concepts to see if they work,"
Ms. Julsen said. "This is something that retailers do. They
test different concepts that may or may not become a part
of the stores." She didn't elaborate on the nature of the
concepts HomePlace is exploring. The changes in the North
Olmsted store are not particularly drastic, but they're
designed to make the store's most popular merchandise more
easily accessible to consumers, said a source familiar with
HomePlace's Chapter 11 bankruptcy case.
"They are not changing the store dimensions, but the store
has been re-merchandised," said the source, who asked not
to be identified. The source said HomePlace's committee of
unsecured creditors "felt some of the merchandise was
placed too high" for customers to reach.
"They want to keep most of the popular items at a lower
level," the source said. One noticeable change in the North
Olmsted store is that the retailer moved its kitchen
gadgets and utensils to one of the sections closest to the
entrance. The 78-store retail chain filed for Chapter 11
bankruptcy protection from creditors last January. In its
most recent monthly report, the company reported an
operating profit of $261,959 on revenues of $31.9 million
in July. But overall, the company lost $3.66 million in the
month.
Since filing for bankruptcy, HomePlace has closed 20 stores
and has lost $62.9 million on revenues of $224.3 million.
HomePlace in the next several weeks expects to present a
draft form of a new business plan to the creditors'
committee, Ms. Julsen said. (UMI Company -Crains 09/28/98)
INTERLINE RESOURCES: Restraints on Activities Removed
-----------------------------------------------------
As a result of the confirmation of its reorganization plan,
restraints on the activities of Interline imposed by the
bankruptcy code have been removed. Interline reached
agreement with its major creditor during the Chapter 11
case and the terms of the agreement were incorporated in
the plan. All other creditors will be paid in full under
the plan.
Michael R. Williams, president of Interline Resources,
stated, "The chapter 11 reorganization was unfortunate;
however, the proceedings helped the company to focus on its
goal of providing high tech environmental solutions to the
growing problem of used oil disposal world wide."
Interline has developed an innovative method for the
removal of physical and chemical contaminants from used
oil, yielding quality lubricating base oils or clean
burning industrial fields. Interline has built plants
utilizing its technology in England, United Arab Emirates,
United States, Korea, Australia, with a new license being
signed for a plant in Spain.
Interline Resources is a holding Company engaged in three
areas of business, each operating as wholly owned
subsidiaries. Interline Hydrocarbon, Inc. commercializes
the Company's used oil refining technology world wide;
Interline Energy Services is a gas Processing and crude
gathering system located near Douglas, Wyoming; and NRG
Transportation is a trucking company, supplying LPG
liquids for Interline's Well Draw Gas Plant. (Enterprise
Business Newspaper Inc. Sep 21, 1998)
LACLEDE STEEL: Beneficial Ownership of Stock Reported
-----------------------------------------------------
Birmingham Steel Corporation, Midwest Holdings Inc. and LCL
Holdings II, LLC report to the SEC beneficial ownership of
1,888,961 shares of common stock of Laclede Steel Company,
or 38.42% of the class.
On September 24, 1998, Midwest Holdings notified LCL
Holdings I that it is canceling, terminating and
rescinding the Voting Agreement and relinquishing and
releasing the Proxy relating to the Holdings I Common
Shares and the Holdings I Conversion Shares as of September
24, 1998.
LOUISE'S TRATTORIA: First Amended Plan of Reorganization
--------------------------------------------------------
On November 10, 1998 a Disclosure Statement Hearing will be
held In re Louise's Trattoria, Inc., debtor. The plan is
primarily a liquidating plan. The debtor formerly owned
and operated a chain of 15 active Italian food restaurant.
In January, 1998 the debtor consummated a sale of its 15
Southern California restaurants to an entity known as LT
Acquisition Corp for a purchase price of $4 million plus a
senior secured interest bearing note with a principal
amount of $3,5 million. The debtor has approximately
$2.874 million of cash as of September 30, 1998. In
addition to the cash and the Senior Note, the debtor owns a
70% stock interest in a corporation known as LTI/MKE
Development Corp. which owns one Italian food restaurant
located in Milwaukee, Wisconsin.
Unsecured claims of BT Capital Partners, Inc. total $2.4
million and unsecured claim of Bank of America is $7.665
million. Both claimants will receive a pro rata
distribution from the Liquidation Fund. The approximate
payout percentage to Class 3(general unsecured creditors)
is 40%.
MAGIC RESTAURANTS: Creditor Seeks Conversion to Chapter 7
---------------------------------------------------------
Keybro Enterprises, a creditor of Magic Restaurants, Inc.
and several of its debtor subsidiaries, moves for an order
converting the cases to cases providing for the liquidation
of the debtors under Chapter 7 of the Bankruptcy Code.
The creditor states that the debtors have materially
defaulted with respect to their confirmed plan. The
debtors have failed to perform on their obligations to
Keybro by having failed to pay the interest or the
principal installments on its allowed claims. They have
violated the debtor restrictions imposed upon the Levittown
subsidiary which was a mechanism devised to protect Keybro
and the other holder of 8% Preferred Stock, Red Robin
International Inc.
Through conversion, a trustee would be put in place to
assure the protections of the assets and their orderly
liquidation for the benefit of all creditors, including
Keybro. A trustee would be in a position to sell and
assign the debtor's leasehold interests. Upon dismissal of
the cases, Keybro asserts that the assets would dissolve,
rather than be preserved in a conversion to Chapter 7.
ONCOR INC: Letter of Intent For Codon Withdrawn
-----------------------------------------------
Perseus Capital, LLC withdrew its Letter of Intent to
acquire the assets of Codon, Inc., a wholly owned
subsidiary of Oncor, Inc. As a result, Codon will
substantially cease all operations as of October 1, 1998.
Oncor is actively seeking the immediate sale of the
intellectual property and other assets of Codon and
anticipates that no material charges will result
from such a sale. Oncor has been notified by a creditor
which holds the Company's $4 million secured note due
October 31, 1998 that it deems this event to be a material
adverse event, and therefore an event of default. Pursuant
to its rights in an event of default, the creditor has made
a demand for acceleration of the note. The creditor and the
guarantors, who comprise a group of significant
shareholders, investment funds and certain directors of the
Company, have agreed that the guarantors will acquire the
note and the rights thereunder from the creditor
immediately.
The Company has developed and instituted a plan supported
by the guarantors whereby the Company has reduced its scope
of operations and on-going operating expenses and is
seeking to generate sufficient cash to repay the secured
note, meet its obligations to trade creditors and preferred
stockholders, create shareholder value and maintain
continuing operations. The Company is seeking
cash through the sale of assets, including intellectual
property, and through strategic alliances. Pursuant to this
plan, the Company has reduced its employment by
approximately 30 people, will curtail substantially all of
its external research programs and cut back portions of its
marketing efforts. The Company will maintain manufacturing,
selling and internal research and development activities.
The guarantors are currently supporting the Company in its
plan by supplying working capital in accordance with the
plan and not exercising their rights to immediate repayment
of the note. The guarantors could withdraw their support at
any time and demand immediate repayment of the note. Since
the Company currently has no significant cash reserves
available, such action would likely force the
Company to file for reorganization or liquidation in
bankruptcy. Such action would also likely cause the Company
to immediately cease all operations.
As previously announced by Oncormed Inc., Gene Logic Inc.
completed its acquisition of Oncormed on September 28,
1998. In connection therewith, Oncor received approximately
420,000 shares of Gene Logic common stock which are
subject to certain previously disclosed 60-day transfer
prohibitions and 12- month restrictions and are pledged
under the note. The closing price of Gene
Logic stock was $4.00 per share on September 29, 1998.
Separately, R. James Danehy announced that he has elected
not to become Chief Executive Officer of Oncor before year-
end, as had been previously expected and reported. Danehy
intends to remain as Vice Chairman of the Board of
Directors. Jose Coronas will continue as the Chairman of
the Board of Directors of theCompany.
ONCOR INC: Trading Halted in Common Stock
-----------------------------------------
Oncor Inc. announced on October 2, 1998 that the American
Stock Exchange has advised the Company that trading has
been halted in the Company's Common Stock and that the
trading halt will continue indefinitely.
The Company had previously announced that it had received a
notice from the Exchange expressing AMEX's intention to
proceed with the filing of an application with the
Securities and Exchange Commission to remove the Company's
shares of common stock from listing and registration on the
Exchange. The Company has previously announced its
intention to appeal the decision of the Exchange to de-list
its shares.
The Company opposes the indefinite trading halt imposed by
the American Stock Exchange and is considering its remedies
and alternatives. There can be no assurance that trading in
the Company's Common Stock will resume on the AMEX or
any other exchange or quotation service. As previously
reported, due to its history of losses and other related
factors, the Company continues to be below
certain guidelines for continuing listing of its common
stock on the Exchange. The Company is also considering
alternative public markets. Any alternative
public markets or exchanges that may be available to the
Company likely would provide substantially less liquidity
and market support for the shareholders of the Company and
materially and adversely affect the ability, if any, of the
Company to raise additional equity capital in the future.
Oncor develops, manufactures and markets gene-based test
systems and related products for use in the detection and
management of cancer and other human disease.
ONE-STOP WIRELESS: Seeks Order Setting Bar Date
-----------------------------------------------
One-Stop, PPC Nevada and PPC Canada, debtors, desire to
propose a plan of reorganization. the debtors need to
determine the nature and extent of claims and interests
against the bankruptcy estates. The debtors request that
the court fix the bar date for filing claims or interests
for seventy days after the date of entry of the order to
set a bar date.
PARADISE HOLDINGS: Judge Approves Sale To Original Owners
---------------------------------------------------------
Paradise Holdings Inc. was given the go-ahead Thursday by a
federal bankruptcy judge to sell its unprofitable bakery
and cafe chain that has left the Sacramento-based company
more than $3 million in debt. Judge Christopher M. Klein
authorized the sale of 33 Paradise Bakery Inc. franchises
and seven company-owned cafes to Paradise Acquisition Inc.,
which has offered $2.41 million for the properties. A
franchise in Hawaii that would have boosted the selling
price to $2.5 million was left out of the package pending
settlement of unrelated litigation. The buyers -- Daniel
Patterson, Mark Patterson and Carter Holmes -- all of
Aspen, Colo. -- were the original owners of the bakery
chain. They now operate 13 of the 34 Paradise Bakery
franchises.
The last year has been a tumultuous one for the publicly
traded company that filed for Chapter 11 bankruptcy
protection in August. Last May, elated company officials
believed they had sold the bakery/cafe portion of the
company when they signed a letter of intent with AFC
Enterprises of Atlanta, which owns Church's Chicken and
Hardee's restaurants. They were poised to take the company
in a new direction by using the $5 million sale proceeds to
buy an Internet publishing company. But that transaction
unexpectedly unraveled on Aug. 11 when AFC announced a
change of heart and withdrew the offer. Two weeks later,
Paradise Holdings filed for bankruptcy protection, closed
down seven stores and petitioned the court to allow it to
quickly sell the chain before additional debts could
accumulate.
Paradise Holdings was founded in 1992 as the owner and
franchisor of espresso cafes called Java Centrale. It sold
off those operations in January and changed its name to
Paradise Holdings Inc. in May. According to court
documents, the company has "never made a profit in any
year since its formation and net losses have grown during
each of the most recent three fiscal years." In its most
recent financial statement, the company reported a net loss
of $6.9 million for the fiscal year that ended in March, or
$3.42 per share, compared to a net loss of $5.3 million, or
$4.61 per share, for the same period
last year. (Sacramento Bee - 10/09/98)
PINNACLE MICRO: Heads Off Bankruptcy
------------------------------------
Pinnacle Micro Inc. has headed off an attempt to force it
into bankruptcy.
Three dissident creditors agreed to drop an involuntary
bankruptcy petition and to support the company's out-of-
court restructuring plan, the company said. The dismissal
is an important step for Pinnacle, which is struggling to
recover from $61 million in losses in the past two years.
Pinnacle also said it has again extended the date for
creditors to vote on its organization plan to Oct. 30.
The company owes $5.4 million to Coast Business Credit and
$17.6 million to trade creditors. Pinnacle has pledged all
of its assets to Coast and is offering the trade creditors
a share of its cash flow _ once it has some to share.
Pinnacle makes optical storage devices for computers. Once
among Orange County's most promising high-tech businesses,
Pinnacle got into financial trouble when it couldn't
deliver a key product on time. The 4.6-gigabyte Apex
drive, which was supposed to be a breakthrough product, was
released more than a year behind schedule. (Orange County
Register-10/07/98)
SOUTHERN PACIFIC: Class Actions Announced
-----------------------------------------
Savett Frutkin Podell & Ryan, P.C. announces that a class
action lawsuit was filed in the United States
District Court for the District of Oregon on behalf of all
purchasers of Southern Pacific Funding Inc. common stock
from Jan. 29, l998 through and including Sept. 16,
l998 against Imperial Credit Industries Inc. and
one of its directors and certain of Southern Pacific
Funding Inc.'s officers and directors, alleging violations
of the Securities Exchange Act of l934.
The Complaint charges certain officers of Southern Pacific
and ICCI and one of its officers and directors with
violations of the Securities Exchange Act of l934, as a
result of their dissemination of numerous materially false
and misleading announcements concerning the financial
condition of Southern Pacific Funding. Plaintiffs allege
that in a succession of announcements and public filings
during the Class Period, defendants reported "record"
fourth quarter 1997, extremely positive first quarter 1998
and "record" second quarter 1998 Southern Pacific revenues
and earnings, creating and sustaining the false impression,
at all relevant times, that the Company was experiencing
extraordinary profitability and that the same profitability
and growth would be maintained and enhanced.
The law firm of Cohen, Milstein, Hausfeld & Toll, P.L.L.C.
on behalf of its client, also announced that on Oct. 9,
1998 filed a lawsuit in the United States District Court
for the District of Oregon, on behalf of persons who
purchased or otherwise acquired the common stock of
Southern Pacific Funding Corporation between Jan. 29, 1998
and Sept. 16, 1998, inclusive.
Counsel for Class Plaintiff, Barrack, Rodos & Bacine, also
issued an announcement stating that a class action has been
commenced in the United States District Court for
the District of Oregon on behalf of all persons who
purchased the common stock of Southern Pacific Funding
Corp.
Stoll Stoll Berne Lokting & Shlachter P.C. announces that a
class action has been commenced in the United States
District Court for the District of Oregon on behalf of all
persons who purchased the common stock of Southern Pacific
Funding Corp. between January 29, 1998 and September 16,
1998, inclusive. Southern Pacific is based in Lake Oswego,
Oregon, a suburb of Portland, Oregon.
SOUTHERN PACIFIC: Nationwide Crisis In Subprime Mortgages
---------------------------------------------------------
The Southern Pacific collapse is part of a nationwide
crisis in the subprime mortgage industry. Subprime mortgage
companies originate, buy and sell home loans made to
borrowers who cannot qualify for traditional loans.
These companies rely on a heavy flow of cash from lenders
and investors to fund their operations, and in recent weeks
international turmoil and growing worries over the
financial condition of some subprime companies has reduced
sources of funds.
"There's a liquidity crunch going on, and because of that,
a lot of the more marginal subprime lenders won't be able
to survive," said Sam Cooper, executive vice president of
Chase Manhattan Funding in Woodcliff Lake, N.J., the
subprime lending subsidiary of Chase Manhattan Bank.
Of the top 25 subprime companies, Cooper predicted half may
fail over the next 12 months. Southern Pacific was the
nation's 14th largest subprime company, according to the
National Mortgage News, a trade publication.
Southern Pacific of Lake Oswego, Ore., moved into Sonoma
County in December 1997 when it acquired the loan servicing
division of North American Mortgage for $400,000. The
division was put on the market when North American Mortgage
was purchased by Dime Bancorp, which services its loans in
New York. At the time, officials of North American
Mortgage and Dime Bancorp expressed relief at saving 80
North American jobs that would otherwise have been
eliminated by the merger. But some servicing employees
expressed concern about transferring from a conventional
lender like North American to the higher-risk arena of
subprime lending.
The company's problems stem from the financial crisis
gripping Asia and Europe, one analyst said last week. With
the global economic crisis, lenders in America that provide
money for Southern Pacific are reluctant to continue
funding the company, which basically froze Southern
Pacific's ability to borrow money. In addition, he said
that some of Southern Pacific's lenders were concerned
borrowers would tend to refinance their loans as interest
rates drop, reducing the company's revenues. On Sept. 29,
Southern Pacific said it was negotiating with its creditors
over defaults on its $1.3 billion line of credit. When the
negotiations broke down, Southern Pacific filed a petition
to reorganize under Chapter 11 in U.S. Bankruptcy Court
Thursday, which would have protected the company from its
creditors while it prepared a restructuring plan.
The reorganization plan sought permission to borrow $100
million from Greenwich Capital Markets Inc. to fund new
loans and $12 million in working capital. The bankruptcy
filing came only three months after Southern Pacific
reported record profits, posting $14.5 million in earnings
for the second quarter of 1998, up from $13.4 million in
the same quarter a year ago.
Loan originations and purchases almost doubled to $800.2
million in the second quarter of 1998, up from $439.6
million for the same period in 1997, the company reported.
Trading in Southern Pacific stock was suspended by the New
York Stock Exchange last week after the announcement of the
bankruptcy petition. It closed Thursday at 81.25 cents a
share.(Press Democrat Santa Rosa - 10/09/98)
STORMEDIA: Files Chapter 11 Petition
------------------------------------
StorMedia Incorporated (Nasdaq:STMD) announced that it had
filed for court protection under Chapter 11 of the
bankruptcy code in the US Bankruptcy Court,
Northern District of California. In addition, the Company
announced that it has substantially curtailed operations in
all of its locations including those in Santa Clara,
California, Singapore and Kulim Malaysia.
"The Company's Executives, the Board of Directors and
myself are extremely disappointed in having to take this
action. We would like to thank the employees for their
dedication and efforts and wish them well in the future. We
regret the impact this has had on the shareholders,
customers and vendors who have supported us for so many
years" said William J. Almon Chairman and CEO.
TOSHOKU AMERICA: Seeks To Consummate Sale
-----------------------------------------
Toshoku America Inc., debtor, seeks a court order
authorizing the debtor to consent to and take such other
actions as are necessary to consummate the sale of
substantially all of the assets of Vero Beach Citrus
Packers, Inc. and Frontier Fresh, Inc. and approving a
contraction in connection therewith. The assets are
substantially all of the assets of two wholly-owned non-
debtor subsidiaries of the debtor engaged in the business
of fruit processing and include realty and fixtures,
machinery and equipment and all physical inventory. The
purchase price is approximately $1 million.
The debtor has determined that it is in its business
judgment and the best interests of the estate to cause and
consent to the sale of the assets. The assets have been
marketed for approximately 10 months and the value of the
debtor's equity ownership is minimal. The debtor is an
unsecured creditor of both companies.
WINDSOR ENERGY: Final Order For Use of Cash Collateral
------------------------------------------------------
The court considered the joint emergency motion to approve
the agreed order regarding the limited use of cash
collateral filed by Windsor Energy US Corporation and
Rincon Island Limited Partnership. The court finds that
good, adequate and sufficient cash has been shown to
justify the granting of the relief. The use of cash
collateral by the debtors is actual and necessary to
preserving these estates, and will avoid immediate and
irreparable harm to the debtors. The debtors are
authorized to use cash collateral in strict accordance with
the terms and conditions provided in the final cash
collateral order.
Meetings, Conferences and Seminars
----------------------------------
October 9-13, 1998
NATIONAL CONSUMER LAW CENTER
7th Annual Consume Rights Litigation Conference
San Diego, California
Contact: 1-617-523-7398
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 9-10, 1998
RENAISSANCE AMERICAN CONFERENCES & BEARD GROUP, INC.
Conference on Corporate Restructurings: Asia
Indonesia * Thailand * South Korea
The Radisson Empire Hotel, New York, New York
Contact: 1-903-592-5169 or ram@ballistic.com
November 17-18, 1998
AIC WORLDWIDE
Retail Credit Card Management & Collections
Chicago Hilton & Towers, Chicago, Illinois
Contact: 1-212-714-1444
November 20-23, 1998
COMMERCIAL LAW LEAGUE OF AMERICA
78th Eastern District Meeting
New York Marriott World Trade Center, New York
City
Contact: Warren Pinchuck, New Hyde Park, New
York
November 30-December 1, 1998
RENAISSANCE AMERICAN CONFERENCES & BEARD GROUP, INC.
Distressed Investing '98
The 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, 1999
COMMERICAL LAW LEAGUE OF AMERICA
Annual Western District Meeting
Monte Carlo Hotel & Casino Resort,
Las Vegas, Nevada
Contact: 1-702-382-9558
Febraury 28-March 3, 1998
NORTON INSTITUTES ON BANKRUPTCY LAW
Norton Bankruptcy Institute I
Olympic Park Hotel, Park City, Utah
Contact: 1-770-535-7722
March 18-21, 1998
NORTON INSTUTUTES ON BANKRUPTCY LAW
Norton Bankruptcy Litigation Institute II
Flamingo Hilton Hotel, Las Vegas, Nevada
Contact: 1-771-535-7722
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
April 28-30, 1999
INTERNATIONAL FEDERATION OF INSOLVENCY PROFESSIONALS
INSOL Bermuda '99 Conference of the Americas
Castle Harbour Marriott Resort
Contact: INSOL@weil.com
The Meetings, Conferences and Seminars column appears
in the TCR each Tuesday. Submissions via e-mail to
conferences@bankrupt.com are encouraged.
*********
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 * * *