/raid1/www/Hosts/bankrupt/TCR_Public/981030.MBX
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, October 30, 1998, Vol. 2, No. 213
Headlines
@BIGGER.NET: Files Chapter 7
BIG RIVERS: The Examiner's Fee
BIG RIVERS: LG&E Energy Responds to Examiner's Fee
BIG RIVERS: United States Opposes Examiner's Fee
BOSTON CHICKEN: $70 Million DIP Pact Wins Final Court Nod
CAMPO ELECTRONICS: Bidding Abruptly Halted
CITYSCAPE CORP: Case Summary & 20 Largest Creditors
CITYSCAPE CORP and CITYSCAPE FINANCIAL: Professional Data
CITYSCAPE FINANCIAL: Case Summary & 20 Largest Creditors
CRIIMI MAE: Trustee Names Criimi Mae Creditor Panel
CROWN BOOKS: Seeks To Extend Exclusivity
DIXONS US HOLDINGS: Seeks Exclusivity Extension
FPA MEDICAL MANAGEMENT: Seeks Exclusivity For Plan Talks
GREATE BAY HOTEL: Seeks Exclusivity Extension To Feb. 8
J-PITT STEEL: Johnstown steel mill back in business
KNITWAVES LLC: Case Summary & 20 Largest Creditors
MERIS LABS: Court Approves Acquisition By Unilab Corp.
MITA INDUSTRIAL: Sues Ex-Execs For 1.9 Billion Yen
PITTSBURGH PENGUINS: NHL Reasserts Right to Seize Franchise
POWER CO: Sues To Void Debt Claims, Free Cash
SOUTHERN PACIFIC FUNDING: To Repurchase Mortgage Loans
SYQUEST TECHNOLOGY: Significant Liquidity Problems
US OFFICE PRODUCTS: Class Action Against Ledecky
DLS CAPITAL PARTNERS: Bond Pricing For Week of October 26
*********
@BIGGER.NET: Files Chapter 7
----------------------------
@bigger.net, an Internet service provider servicing
Southern California and the San Francisco Bay area, filed
chapter 7 to liquidate its assets earlier this month in San
Jose, Calif., according to CNET. The company had filed
chapter 11 last December but continued operations and tried
to expand its service. The company owed creditors about $2
million when it filed chapter 11, and still owes more than
$1.5 million. @bigger.net offered Internet access for
$59.95 plus tax and shipping and handling; this entitled
users to one email account for a year, with a renewal cost
of $10 for each additional year. Chapter 7 Trustee Suzanne
Decker said the court hopes to keep the customer base of
30,000 to sell @bigger.net. So far at least seven companies
have expressed an interest in the assets, and an offer
could come as early as tomorrow. (ABI 29-Oct-98)
BIG RIVERS: The Examiner's Fee
------------------------------
In the final application, J. Baxter Schilling (the
"Examiner") requests that the court approve compensation
for the services he performed as the Examiner from October
18, 1996 through October 12, 1998 in the amount of
$4,410,000.
Big Rivers objects to $3,879,071.25 of this amount on the
grounds that the "Fee Enhancement Claim" services were not
appropriate and were not necessary or beneficial to Big
Rivers, its estate or its constituents.
The debtor states that the requested enhancement fee
exceeds the maximum amount permissible under applicable
law, that the "Common Fund" theory does not support the
Examiner's Fee Enhancement Claim, that the appropriate
measure of compensation is the Lodestar Standard, not a
percentage of Common Fund or "New value." The debtor also
states that sound public policy considerations dictate that
the examiner's fee enhancement claim be denied, that the
examiner was not primarily responsible for the "New Value,"
and that the Examiner's conduct was "outrageous." The
debtor states that in negotiating a percentage fee
arrangement just 2 weeks after his appointment, the
Examiner should have been a neutral fiduciary. The debtor
alleges that the Examiner hurried to reach a preliminary
conclusion about Big Rivers' pre-filing actions. As the
case went on, the Examiner had every motivation to stay on
the 'good side' of those he believed would support his
enhancement at the end of the case. While attempting to
reach a global settlement for the benefit of all creditors,
he was carrying out these duties tainted by an undisclosed
agreement with certain creditors.
BIG RIVERS: LG&E Energy Responds to Examiner's Fee
Application
--------------------------------------------------
In the Big Rivers Electric Corporation bankruptcy case, J.
Baxter Schilling (the "Examiner") requests that the court
approve compensation for the services he performed as the
Examiner from October 18, 1996 through October 12, 1998 in
the amount of $4,410,000.
The Examiner, J. Baxter Schilling did not include LG&E
Energy ("LG&E") among the parties that he believes should
fund payment of the Examiner Fee, if granted.
However, because the court continues to characterize LG&E
as an interested party, LG&E responds to the Examiner's
reuqest for an enhanced fee. LG&E states that it should
not pay any portion of the fee since LG&E provided the
addition value received by the estate. "Indeed LG&E was a
benefactor rather than a beneficiary with respect to the
additional value received by the estate."
LG&E argues that the fee is an administrative cost of the
estate, and under the plan, Big Rivers is required to pay
administrative claims. In addition, LG&E is an unsecured
creditor of the estate and to impose a surcharge against an
unsecured Creditors' property for payment of a debtor's
administrative expenses is not authorized under the code.
BIG RIVERS: United States Opposes Examiner's Fee
------------------------------------------------
The United States asserts in its opposition to the
Examiner's fee request that the Examiner was not
disinterested or impartial.
"He understood that he had an agreement with three
unsecured creditors that they would pay him, with the
amount of that compensation directly dependent on how well
they did in this case. He had a conflict of interest, and
he should be removed, sanctioned denied all compensation
and ordered to disgorge all fees received by him or his
professionals."
The United States alleges many reasons for the Examiner not
to receive his fee, the core argument resting on the
premise that the Examiner did not candidly disclose all
factual circumstances surrounding the compensation
agreement he has maintained he reached with unsecured
creditors. The Examiner had an affirmative duty to disclose
fee agreements he had with unsecured creditors.
BOSTON CHICKEN: $70 Million DIP Pact Wins Final Court Nod
---------------------------------------------------------
Boston Chicken's $70 million debtor-in-possession credit
agreement with General Electric Capital Corp. and
Bank of America received final approval at a hearing Monday
night. The court also authorized cash collateral use,
assumption of a key employee retention bonus plan, and
assumption of a number of executive employment contracts.
The court had earlier authorized the fast food chain to
borrow up to $41.9 million under the DIP facility on an
interim basis, pending the final hearing. (Federal Filings
Inc. 29-Oct-98)
CAMPO ELECTRONICS: Bidding Abruptly Halted
------------------------------------------
A bankruptcy court hearing to dispose of property and
inventory from the shuttered Campo Electronics company
abruptly adjourned Tuesday with no deals approved.
Judge Thomas Brahney shut down the proceedings after a
brief hearing and left no instructions for the next steps
in disposing of the retailer's goods.
The crowd of bidders, creditors and Campo officials were
left perplexed at the unexpected end of proceedings.
Brahney, expressing disapproval with the auction process,
said it was not proper to negotiate the prices.
Campo Electronics, Appliances and Computers Inc. has been
in bankruptcy court trying to reorganize its business since
June 1997.
A Campo spokesman said the company had distributed
information on the sale to 24 potential buyers and as many
as 10 had researched the finances and potential liabilities
of the company. Brahney ordered Campo to contact consumers
who have merchandise that has been purchased but not
delivered. The company said it had established a toll-
free number for these claims and would contact customers.
Layaway down payments will be dealt with case by case.
Tuesday's court proceeding was the second in two days, with
dozens of attorneys submitting oral bids. Among the offers
was one from an affiliate of New Orleans retailer A-1
Appliances, which bid on seven company-owned New Orleans
area stores and their inventory. The bid excluded computers
and computer accessories and came in at 85 cents per $1 of
inventory that is usable.
Lenders Deutsche Business Services Corp. and Whirlpool
Financial Corp. offered the same amount on the inventory
from the other stores in the 20-outlet chain and on the
computer equipment. Deutsche and Whirlpool went to court
last week to declare Campo in default on its $40 million
credit agreement with them. The move cut off Campo's cash
supply and forced the company to shut its stores.
Hibernia National Bank, which was Campo's lead bank for
real estate, made a noncash or credit bid on seven stores.
The bank is owed $15.9 million and bid $11.6 million on its
loan amounts.
Kirschman's Inc. furniture company, offered $1.575 million
bid for a store in Mobile, Ala. Other single-store bids
came from Conn Appliances for the Baton Rouge location,
Cowboy Maloney's Electric City in Jackson, Miss., for the
Monroe store and Northlake Partnership for the lease on the
Northlake store.
In other bidding, Rex of Louisiana Inc. offered $325,000
for leases and fixtures on 10 stores. Rex Stores Corp. of
Dayton, Ohio, which sells under the name Rex TV, operates
220 stores in 35 states, mostly in the Midwest and
Southeast. (Copyright 1998 by Capital City Press Advocate
Baton Rouge -10/28/98)
CITYSCAPE CORP: Case Summary & 20 Largest Unsecured
Creditors
---------------------------------------------------
Debtor:
Cityscape Corp.
565 Taxter Road
Elmsford, NY 10523
aka Astrum Funding Corp.
aka Cityscape Mortgage Corp.
aka Ready Financial Services
Debtor's Counsel:
Robert J. Rosenberg
Latham & Watkins
885 Third Avenue
New York, NY 10022
(212) 906-1370
Court: Southern District of New York
Case No.: 98B22570 Filed: 10/06/98 Chapter: 11
20 Largest Unsecured Creditors:
Name Amount
---- ------
Indenture Trustee $300 million
for Cityscape Financial Corp's
12 3/4 Notes due 2004
Indenture Trustee For
Cityscape Finacnial Corp's
6%Convertible Subordianted
Debentures due 2006 $129.6 million
Reckson Operating Partnership $65,706
Specialized Mtg Services $52,470
Preferred Business Forms $50,318
Public Record Information Service $45,893
AT&T $38,571
RM Mid-West Realty Assoc. $38,500
Interlink Mortgage Services $36,330
Drake Oak Brook Plaza $30,913
BFC, Inc. $30,498
Chicago Title Credit Services $28,148
Actuate Software Corp. $16,012
Steelcase Financial $13,807
Saturn II Systems, Inc. $13,723
WHVPW, RE, LP $13,490
Airborne Express $9,331
Star, Inc. $8,917
AT&T Capital Leasing $8,785
Standarad Security Life Insurance $8,758
The CIT Group/Equipment Financing Inc. $14,312,916*
Greenwich Capital Financial Products Inc. $129,829,252*
*subject to reconciliation and adjustment
CITYSCAPE CORP and CITYSCAPE FINANCIAL: Professional Data
---------------------------------------------------------
Case Filed October 6, 1998.
Assigned to: Judge Adlai S. Hardin Jr.
Represented by:
Latham & Watkins
885 Third Avenue
Suite 1000
New York, NY 10022
Kevin W. Barrett
Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, NY 10166
(212) 351-3826
Creditor Committee
Unofficial Committee of Holders of 6% Convertible
Subordinated Debentures
Kramer, Levin, Naftalis & Frankel
919 Third Avenue
New York, NY 10022
Represented by
Saul Eliot Burian
Kramer, Levin, Naftalis & Frankel
919 Third Avenue
New York, NY 10022
(212) 715-9373
UNOFFICIAL COMMITTEE OF 12-3/4% SERIES A SENIOR
NOTEHOLDERS
Represented by:
David M. Friedman
Kasowitz, Benson, Torres & Friedman LLP
1301 Avenue of the Americas
New York, NY 10019
(212) 506-1740
CITYSCAPE FINANCIAL: Case Summary & 20 Largest Unsecured
Creditors
---------------------------------------------------------
Debtor: Cityscape Financial Corp.
565 Taxter Road
Elmsford, NY 10523
Type of business: Consumer finance company that, through
its wholly-owned subsidiary, CSC, engages in the business
of originating, purchasing, selling and servicing mortgage
loans secured primarily by one-to four-family residences.
Court: Southern District of New York
Case No.: 98B22569 Filed: 10/06/98 Chapter: 11
Total Assets: $322,224,778
Total Liabilities: $608,724,522
Debt Securities held by more than 500 holders:
Unsecured $300,000,000 2,000 holders
Subordinated $129,620,000 600 holders
No. of shares of preferred stock Series A - 626 shares
7 holders
Series B - 4,551 shares
20 holders
No. of shares of common stock 64,878,969 shares
547 holders
20 Largest Unsecured Creditors:
Name Amount
---- ------
Indenture Trustee $300 million
for Cityscape Financial Corp's
12 3/4 Notes due 2004
Indenture Trustee For
Cityscape Finacnial Corp's
6%Convertible Subordianted
Debentures due 2006 $129.6 million
Reckson Operating Partnership $65,706
Specialized Mtg Services $52,470
Preferred Business Forms $50,318
Public Record Information Service $45,893
AT&T $38,571
RM Mid-West Realty Assoc. $38,500
Interlink Mortgage Services $36,330
Drake Oak Brook Plaza $30,913
BFC, Inc. $30,498
Chicago Title Credit Services $28,148
Actuate Software Corp. $16,012
Steelcase Financial $13,807
Saturn II Systems, Inc. $13,723
WHVPW, RE, LP $13,490
Airborne Express $9,331
Star, Inc. $8,917
AT&T Capital Leasing $8,785
Standarad Security Life Insurance $8,758
The CIT Group/Equipment Financing Inc. $14,312,916*
Greenwich Capital Financial Products Inc. $129,829,252*
*subject to reconciliation and adjustment
CRIIMI MAE: Trustee Names Criimi Mae Creditor Panel
---------------------------------------------------
The U.S. Trustee has appointed an official committee of
Criimi Mae Inc.'s unsecured creditors: Prudential
Securities Credit Corp. (interim chair), New York, N.Y.;
Standish Ayer & Wood Inc., Boston; Riggs Bank N.A.,
Washington, D.C.; Conseco CapitalManagement Inc., Carmel,
Ind.; and RER Resources L.P., Herndon, Va. (The Daily
Bankruptcy Review and ABI 29-Oct-98)
CROWN BOOKS: Seeks To Extend Exclusivity
----------------------------------------
Crown Books Corporation and its affiliated debtors seek to
extend the periods within which to file a plan of
reorganization and solicit acceptances thereto.
The debtors seek to extend the exclusive period within
which the debtors may file a plan or plans of
reorganization for 120 days, through and including March
11, 1999; and the exclusive period within which the debtors
may solicit acceptances of any such plan through and
including May 11, 1999.
The debtors state that since the Petition Date the debtors
have made great strides toward stabilizing their business
operations. The debtors have obtained approval of
significant post-petition secured financing that allows
them to operate their businesses on a going-forward basis
with sufficient capital to make the necessary expenditures
to avoid damage and disruption to their operations.
Additionally, they have engaged in preliminary and advanced
negotiations with numerous creditor constituencies and
parties-in-interest, including the creditors' committee,
trade vendors, publishers and landlords.
Extending the exclusive periods, will according to the
debtor, enable the debtor and the creditor constituencies
to explore restructuring alternatives. The debtors have
closed 39 of their stores, and the debtors have
consolidated most of their book purchasing activities
through the Ingram Book Company. The debtors are focusing
on positive fourth quarter results.
The exclusivity periods represent to the debtors their best
chance for a successful rehabilitation, and the debtors
believe that the size and complexity together with their
progress in this case warrant the extensions.
DIXONS US HOLDINGS: Seeks Exclusivity Extension
-----------------------------------------------
The debtors, Dixons U.S. Holdings, Inc. and debtor affiliates,
seek to extend their exclusivity periods for a period of
ninety days. The debtors seek an extension from
October 26, 1998 through and including January 25, 1999 in
order to maintain the exclusive right to file a plan or
plans resolving these cases, as well as an extension
through March 25, 1999 of the period during which the
debtors will have the exclusive right to solicit
acceptances to such a plan. The debtors seek an extension
of the exclusive periods to afford them time to complete
the disclosure statement and the plan confirmation process.
On October 16, 1998 the Global Settlement Agreement between
the debtors, the Committee, Fretter, the Fretter Creditors'
Committee and certain other related parties became
effective. The proceeds from the global settlement will be
used to fund a liquidating plan of reorganization.
On October 23, 1998 the debtors filed a liquidating plan of
reorganization. The debtors are currently preparing a
disclosure statement and anticipate that it will be filed
within the next three weeks. The debtors believe that by
giving the Committee an opportunity to review the plan
prior to the completion and filing of the disclosure
statement, all parties will be able to communicate and
negotiate more effectively, thereby expediting the
resolution of the cases.
FPA MEDICAL MANAGEMENT: Seeks Exclusivity For Plan Talks
--------------------------------------------------------
To allow for further reorganization plan negotiations, FPA
Medical is seeking a postponement of its disclosure
statement hearing and a 90-day extension of its exclusive
periods to file a plan and solicit acceptances to Feb. 15
and April 15, respectively. FPA Medical asserted that,
even though it is prepared to move forward with the
scheduled disclosure statement hearing, the bank group and
committee recently requested more time to evaluate the
proposed plan and to continue negotiations regarding
possible modifications after concluding two days of talks
in New York.
In conjunction with the exclusivity request, the company
agreed to seek a continuance of the disclosure statement
hearing to Dec. 9 and to ask the court to tentatively
schedule a confirmation hearing for January. (Federal
Filings Inc. 29-Oct-98)
GREATE BAY HOTEL: Seeks Exclusivity Extension To Feb. 8
-------------------------------------------------------
Greate Bay is asking the court to extend the company's
exclusive periods to file a reorganization plan and solicit
plan acceptances for 90 days to Feb. 8 and April 7,
respectively. Greate Bay's exclusive periods, extended in
August, are currently set to expire on Nov. 9 and Jan. 8,
respectively. The motion identifies "progress toward
resolution of stumbling blocks" thus far in the Chapter 11
case but requires "a further extension to conclude
negotiations with potential plan funders and creditors
toward a consensual reorganization." (Federal Filings Inc.
29-Oct-98)
J-PITT STEEL: Johnstown steel mill back in business
---------------------------------------------------
The Lancaster PA Intelligencer reports on October 28, 1998
that a steel mill that has changed hands twice this
decade and had been idle for a year has resumed operating
with about 80 workers.
Employees had been preparing for about a month for the
restart of the mill Tuesday under the name GAUTIER STEEL
LTD., a subsidiary of THE RESERVE GROUP.
Mills have occupied the site since the time of the 1889
Johnstown Flood.
The mill was once the Gautier Division of Bethlehem-based
BETHLEHEM STEEL CORP. and then operated as part of
Bethlehem's Bar, Rod and Wire Division, at
times employing thousands, until it closed in 1992.
J-PITT STEEL INC. bought the mill in 1993 and produced
flats and specialty shapes for cars and farm equipment, at
one point employing 170 people. But in December, J-Pitt
filed in federal bankruptcy court for protection from
its creditors. It owed more than $1 million.
Like J-Pitt, the new Gautier Steel will supply shapes for
cars and farm equipment.
KNITWAVES LLC: Case Summary & 20 Largest Unsecured
Creditors
---------------------------------------------------
Debtor: Knitwaves LLC
100 west 33rd Street 9th Floor
New YOrk, NY 10001
Type of business: The manufacture and distribution of
children's apparel
Court: Southern District of New York
Case No.: 98B47588 Filed: 10/22/98 Chapter: 11
Debtor's Counsel: James Berman, Esq.
Scott S. Markowitz, Esq.
Todtman, Nachamie, Spizz & Johns, PC
425 Park Avenue
New york, NY 10022
(212)754-9400
Total Assets: $230,077
Total Liabilities: $1,904,644
No. of
Amount Holders
------ -------
Fixed, liquidated secured debt $0 0
Contingent secured debt $0 0
Disputed secured debt $0 0
Unliquidated secured debt $0 0
Fixed, liquidated unsecured debt Unknown Unknown
Contingent unsecured debt $0 0
Disputed unsecured debt $0 0
Unliquidated unsecured debt $0 0
No. of shares of preferred stock 0 0
No. of shares of common stock 2,391,493 700
20 Largest Unsecured Creditors:
Name Nature Amount
---- ------ ------
Mattel, Inc. Royalties $296,466
Walt Disney Co., Inc. Royalties $222,949
Oxford Health Plan Health Insurance $106,888
Bank of New York Trade Debt $92,316
CIT Group, Inc. Trade Debt $90,593
Trebor Management Rent $61,300
American Express Travel Trade debt $57,000
]12 Empire Blvd. Associates Rent $56,932
Bratex Dominicana Trade debt $44,226
Republic Factors Trade debt $43,332
Tandem Textiles, Inc. Trade debt $43,231
Fred Zuckerman
Tandler textiles Trade debt $43,145
first Factors Trade debt $42,449
United Parcel Service Trade debt $34,636
Nationsbanc Trade debt $31,077
Heller Financial Trade debt $30,714
Roadway Package Service Trade debt $30,319
Essex Fabrics Trade debt $25,717
Jo-Zal Sales, Inc. Trade debt $21,000
MERIS LABS: Court Approves Acquisition By Unilab Corp.
-------------------------------------------------------
Unilab Corp. and Meris Laboratories Inc. announced that the
bankruptcy court in the Central District of California has
approved the previously announced sale of substantially
all of Meris' assets to Unilab, according to a newswire
report. The transaction is expected to be completed within
one to two weeks. (ABI 29-Oct-98)
MITA INDUSTRIAL: Sues Ex-Execs For 1.9 Billion Yen
--------------------------------------------------
Failed photocopier maker Mita Industrial Co. demanded
1.9 billion yen Thursday from four former company
executives in compensation for damages they allegedly
inflicted on the firm in a window-dressing case.
Mita, 59, founder of the Osaka-based firm, was arrested
earlier this month on suspicion of violating the Commercial
Code by paying dividends to shareholders after falsifying
earnings reports to make it look as though company was in
the black.
The petition, a procedure based on the Corporate
Rehabilitation Law, is equivalent to a damages suit.
The compensation sought represents the total amount of
illegal payments that would not have been handed out if the
accounts had not been falsified.
Mita Industrial applied for rescue under the Corporate
Rehabilitation Law on Aug. 10, effectively going bankrupt
with debts of more than 200 billion yen. (Kyodo News-
10/29/98)
PITTSBURGH PENGUINS: NHL Reasserts Right to Seize Franchise
-----------------------------------------------------------
The National Hockey League (NHL) has reasserted its right
to seize the Pittsburgh Penguins franchise, but the league
plans to continue to let the team operate as it is,
according to The Associated Press. The Penguins argued in
bankruptcy court that federal law prohibits termination of
a contract, such as a franchise, during a bankruptcy, but
NHL attorneys argued that the league does have the right to
take back the franchise, even if it does not plan to do so
currently. To preserve its legal right to seize the
franchise, the NHL gave the Penguins a 20-day notice of
ending the franchise agreement; earlier it had served a
10-day notice but did not act. (ABI 29-Oct-98)
POWER CO: Sues To Void Debt Claims, Free Cash
----------------------------------------------
Power Co. of America L.P. is seeking a declaratory judgment
in an adversary proceeding against lender Banque Paribas,
among others, that concludes the power trading company owes
no debt to the other three defendants and forces the bank
to turn over frozen funds. The Oct. 16 complaint alleges
that the false assertions of defendants Southern Energy
Trading & Marketing Inc., Southern Co. Energy Marketing
L.P., and American Electric Power Service Corp. regarding
outstanding debt forced Banque Paribas to freeze $6 million
in Power Co.'s accounts pending resolution of the disputes
as well as reserve $2 million of Power Co.'s cash to cover
litigation costs. (The Daily Bankruptcy Review and ABI 29-
Oct-98)
SOUTHERN PACIFIC FUNDING: To Repurchase Mortgage Loans
------------------------------------------------------
Southern Pacific Funding Corporation, debtor, filed a
notice of intent to repurchase loans from First Union
National Bank and to simultaneously sell the loans to
Lehman Commercial Paper, Inc. and Bomac Capital Mortgage,
Inc. The loans are in the total aggregate principal amount
of approximately $295 million. The sell consists of $259
million of the loans to Lehman and the reminder to Bomac at
a price equivalent to par plus approximately 100 basis
points. A hearing on the motion is scheduled for November
5, 1998.
SYQUEST TECHNOLOGY: Significant Liquidity Problems
--------------------------------------------------
SyQuest Technology Inc. (Nasdaq:SYQT) Wednesday announced
that as of Sept. 30, 1998, the company was not in
compliance with its lending covenants governing its line of
credit with Greyrock Business Credit (GBC), the company's
asset-based lender. GBC has agreed to waive the default.
As part of the waiver agreement, GBC has reduced the
company's credit line from $30 million to $10.75 million.
Currently, the company has no availability under its
reduced credit line for additional borrowing and has no
other sources of significant debt financing.
However, the company is seeking additional funding from
alternate sources. To date, it has not been successful.
These actions, as well as current market pressures, have
created significant liquidity problems for the company.
The company previously announced that it has been in
negotiations with certain of its investors to reach
agreement on a series of transactions that would make
an additional $13 million available to the company. The
transaction has not closed, and it is unlikely to close
unless SyQuest is able to substantially increase its line
of credit.
Even if the company were able to increase its line of
credit, there are not any assurances that the additional
$13 million would be available. As announced Tuesday, the
company continues its relationship with CIBC Oppenheimer as
its investment banker to assist in attempting to
restructure its capital accounts, raise additional
financing and advise the company with respect to
acquisitions or strategic alliances. While there are no
assurances that it will be successful, the company
continues to seek a solution for its current financial
crisis.
US OFFICE PRODUCTS: Class Action Against Ledecky
------------------------------------------------
A class action was commenced on October 27, 1998 in the
United States District Court for the Southern District of
New York, against Jonathan Ledecky, the founder, former
Chairman of the Board and Chief Executive Officer
of U.S. Office Products Co. Sands Brothers & Co, Ltd. , a
market maker in USOP stock; and USOP. According to
plaintiff's attorneys, Lowey Dannenberg Bemporad &
Selinger, P.C., the claims are brought on behalf of a class
of persons who purchased the common stock of USOP between
June 5, 1997 and Sept. 2, 1998 against defendants
Ledecky and USOP on behalf of a subclass of persons who
held USOP stock on March 26, 1998, the record date for a
shareholder vote on components of a USOP corporate
restructuring complained of in the action; and under
Section 20 on behalf of the Class and Subclass against
Ledecky.
The Complaint alleges that defendants made representations
during the Class Period about USOP's earnings and margins
and the value of USOP stock, which they knew were false and
misleading.
DLS CAPITAL PARTNERS: Bond Pricing For Week of October 26
----------------------------------------------------------
Following are indicated prices for selected issues:
Acme Metal 10 7/8 '07 17 - 20 (f)
Amer Pad & Paper 13 '05 46 - 48
Amer Telecasting 0/14 1/2 '04 23 - 25
Asia Pulp & Paper 11 3/4 '05 72 - 74
Boston Chicken 7 3/4 '05 6 - 8 (f)
Brazos 10 1/2 '07 25 - 30
Brunos 10 1/2 '05 8 - 12 (f)
Cityscape 12 3/4 '04 17 - 19 (f)
E & S Holdings 10 3/8 '06 46 - 50
Globalstar 11 1/4 '04 67 - 69
Harrah's Jazz 14 1/4 '01 19 - 21 (f)
Hills 12 1/2 '03 38 - 40
Liggett 11 1/2 '99 72 - 74
Mobilemedia 9 3/8 '07 12 - 15 (f)
Penn Traffic 9 5/8 '05 17 - 18
Planet Hollywood 12 '05 46 - 50
Royal Oak 12 3/4 '06 47 - 50
Service Merchandise 9 '04 47 - 49
Sunbeam 0 '18 11 - 12
Zenith 6 1/4 '11 10 - 15 (f)
***********
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.
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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.
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