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/raid1/www/Hosts/bankrupt/TCR_Public/981203.MBXT R O U B L E D C O M P A N Y R E P O R T E R Thursday, December 3, 1998, Vol. 2, No. 236 Headlines AAMES FINANCIAL: In Discussions Regarding $100M Capital AMERICAN STANDARD: Files Prospectus for $500 Million Issue AMF BOWLING: Amends Registration Statement AMF BOWLING: Kelso Partners Holds 9.8% Equity Stake APRIA HEALTHCARE: Certain Investors Hold 13.2% Equity Stake APRIA HEALTHCARE: Third Amendment to Form 10-K BOSTON BED & BATH: Forced Into Bankruptcy By Competition BRADLEES, INC.: Supplements Prospectus for New Stock/Notes BROOKE GROUP: Redeeming 11.5% Series B & 19.75% Series C Notes BROOKE GROUP: Selling 3 Cigarette Brands to Philip Morris GLOBALSTAR TELECOMM: Registers Ltd. Partners' Shares GRAND UNION: Reorganized Debtor Reports Operating Losses GREATE BAY: Third Quarter Results Disclosed HEARTLAND WIRELESS: Third Quarter Results HONDO OIL: Special Shareholders' Meeting December 23 HUNGARIAN BROADCASTING: Announces Quarterly Results LANDCARE USA: Gabriel & Ariel Hold 7.5% Equity Stake LATTICE SEMICONDUCTOR: Seligman Reports 9.82% Equity Stake MARTIN COLOR-FI: UVEST Lightens Equity Stake MARVEL ENTERTAINMENT: Third Quarter Results of Operations MEGO MORTGAGE: Delays Filing Annual Report on Form 10-K MONTGOMERY WARD: HQ Buyer Returns With Different Offer MRS TECHNOLOGY: October, 1998 Monthly Operating Report NUMED HOME: CEO Resigns at Turkey Vulture's Behest NUMED HOME: Turkey Vulture Fund Sued ONCOR, INC.: Surrenders Assets to Satisfy Debt Obligation OPHTHALMIC IMAGING: Shareholder Meeting on January 7 OXFORD HEALTH: Amends Stock Purchase Agreement PAYLESS CASHWAYS: Cuts Four Executive Jobs PEGASUS GOLD: $20M Financing Offer From Standard Bank PORTACOMM WIRELESS: Restates Balance Sheet QUADRAX CORPORATION: Third Quarter Results Announced SA TELECOMMUNICATIONS: July 1998 Monthly Operating Report SANTA FE GAMING: Pioneer Amends Exchange Offer SIZZLER INTERNATIONAL: Half-Year Results Announced SPECTRUM INFORMATION: May File Another Chapter 11 SUN TV: First Ever Internet GOB Sale TAPISTRON INTERNATIONAL: 1998 Annual Meeting Scheduled USN COMMUNICATIONS: Shareholder Files Suit WELCOME HOME: Corrects Clerical Errors in Latest Form 10-Q ********* AAMES FINANCIAL: In Discussions Regarding $100M Capital ------------------------------------------------------- AAMES FINANCIAL CORPORATION (NYSE: AAM), a leader in subprime home equity lending, reported results for the first fiscal quarter ended September 30, 1998. The Company also announced that it is in exclusive, substantive discussions with a private equity fund, with respect to a proposal pursuant to which up to $100 million would be invested in the Company. In connection with these discussions, the Company has agreed to reimburse the fund for its out-of-pocket expenses and to pay certain fees, including a fee payable in certain circumstances if the Company consummates an alternative strategic transaction. Cary H. Thompson, Aames chief executive officer, said, "Although the Company is currently seeking additional credit facilities, current market conditions have severely hampered the Company's ability to obtain additional warehouse or residual facilities. Further, the Company's liquidity constraints have been exacerbated by the drop in home equity stock prices and the consequent unavailability of the capital markets. The weakness in the securitization market has caused the Company, along with other subprime home equity lenders, to seek refuge in the whole loan market. This has created an abundance in the supply of loans in that market which has resulted in lowering the prices paid and tightening the underwriting guidelines applied by the whole loan purchasers. The Company has raised its prices and modified its underwriting guidelines in response to these changes the effect of which will decrease loan production in the current quarter. If the Company cannot obtain additional credit lines secured by its interest-only strips and residual assets or additional equity capital in the next 30 days, it may have to engage in extraordinary transactions, such as seeking subservicing arrangements that include the obligation to make servicing advances or strategic asset sales, to provide the liquidity necessary to operate, albeit on a much smaller scale." The Company reported revenue for the quarter was $77.0 million, down slightly from $77.9 million from last year's first fiscal quarter. Net income for the quarter was $448 thousand, compared to net income of $13.1 million for the same period a year ago. On a basic and diluted per share basis, net income per share for the quarter totaled $0.01, compared to $0.47 and $0.40, respectively, in the prior year period. The decrease in revenues and net income primarily reflects a $15.3 million loss the Company incurred on its hedge positions expiring in September and December 1998 which reduced its gain on sale. For the first fiscal quarter, gain on sale, including net unrealized gain on valuation of interest-only strips, was $44.1 million, down 11.3 percent from $49.8 million recorded in last year's first quarter. During the first fiscal quarter, the Company, as it has done historically, hedged its fixed rate pipeline by purchasing hedges against U.S. Treasuries. In the past, changes in Treasury rates were generally reflected in the pass-through rates of the fixed rate portion of the Company's securitization. During 1998's first fiscal quarter, unsettled market conditions resulted in a loss on the Company's hedge position without an equivalent benefit from reductions in the pass-through rate paid on certificates sold in the fixed rate portion of the Company's securitization. The Company said that future earnings may be affected by a change in accounting being proposed by the FASB. The Company announced that its board of directors has canceled the regular quarterly cash dividend until such time as the Company's earnings and cash flow improve. AMERICAN STANDARD: Files Prospectus for $500 Million Issue ---------------------------------------------------------- Preparing to issue $500,000,000 of Debt Securities in the public market, American Standard Inc. (as Issuer) and American Standard Companies Inc. (as Guarantor) filed a Registration Statement with the SEC last week. American Standard is a globally oriented manufacturer of high quality, brand-name products in three major product groups: air conditioning systems (60% of 1997 sales); bathroom and kitchen fixtures and fittings (24% of 1997 sales); and braking and control systems for medium-sized and heavy trucks, buses, trailers and utility vehicles (16% of 1997 sales). American Standard is a market leader in each of these business segments in the principal geographic areas in which it competes. The Company's brand names include TRANE(R) and AMERICAN STANDARD(R) for air conditioning systems, AMERICAN STANDARD(R), IDEAL STANDARD(R), STANDARD(R) and PORCHER(R) for plumbing products, WABCO(R) for braking and related systems and LARA(R), Copalis(R) and DiaSorin(TM) for medical diagnostic systems. The Company emphasizes technologically advanced products such as air conditioning systems that utilize energy-efficient compressors and environmentally preferred refrigerants, water-saving plumbing products and commercial vehicle braking and related systems (including antilock braking systems, "ABS") that utilize electronic controls. At December 31, 1997, American Standard had 108 manufacturing facilities in 35 countries. American Standard intends to use the net proceeds from the sale of debt securities for general corporate purposes, which may include the repayment of outstanding debt, stock repurchases, certain investments, acquisitions, additions to working capital or capital expenditures. AMF BOWLING: Amends Registration Statement ------------------------------------------ AMF Bowling, Inc., submitted Prospectus Supplement No. 1 to its Prospectus Dated November 6, 1998, registering $1,125,000,000 of Zero Coupon Convertible Debentures due 2018 and shares of commom stock issuable upon conversion, redemption or repurchase of the notes. AMF BOWLING: Kelso Partners Holds 9.8% Equity Stake --------------------------------------------------- In a Form 13D filed with the SEC last week, Kelso Partners V, L.P., and its reporting affiliates disclose ownership of a 9.8% equity stake in AMF Bowling, Inc. APRIA HEALTHCARE: Certain Investors Hold 13.2% Equity Stake ----------------------------------------------------------- San Diego-based Relational Investors, LLC, and its affiliates disclosed last week that it holds a 13.2% equity stake in Apria Healthcare Group, Inc. The disclosure was made under cover of Form 13D filed with the SEC last week. As previously reported, on February 3, 1998, RILLC entered into a Stockholder Agreement (the "Stockholder Agreement") with JLL Argosy Apria, LLC, CIBC WG Argosy Merchant Fund 2, LLC, Joseph Littlejohn & Levy Fund III, L.P., HBI Financial, Inc. and the Company. The Stockholder Agreement contained certain provisions that might have resulted in the acquisition by the Investor from the Company of shares of Common Stock and warrants exercisable for shares of Common Stock and a change in the Board of Directors of the Company. In April 1998, the transactions contemplated by the Stockholder Agreement were terminated without any obligation to any party. APRIA HEALTHCARE: Third Amendment to Form 10-K ---------------------------------------------- Amending a footnote to its financial statements for the year ended December 31, 1997, Apria Healthcare Group, Inc., filed a Third Amendment to its latest Form 10-K filed with the SEC. Copies of Apria's SEC filings are available at no charge at http://www.sec.gov/cgi-bin/srch- edgar?APRIA+adj+HEALTHCARE via the Internet. As previously reported, Apria reported a net loss of $210 million (unaudited) for the nine months ended September 30, 1998 and projects a loss for the year primarily due to reductions in Medicare reimbursement rates, and charges taken in the third quarter including: (1) recognition of impairment in its goodwill and other intangible assets, (2) charges taken in conjunction with exiting certain product lines in specific geographic areas, (3) high levels of bad debt write-offs and revenue adjustments, and (4) impairment of certain long-lived assets and internally developed software. As a result of the losses, the accumulated deficit increased to $460 million (unaudited) at September 30, 1998. Despite the losses recognized during the nine months ended September 30, 1998, the Company generated cash flow from its operations of $100 million (unaudited). BOSTON BED & BATH: Forced Into Bankruptcy By Competition -------------------------------------------------------- Stiff Competition Forced Boston Bed & Bath into Chapter 11 The Sharon, Mass.-based Boston Bed & Bath chain reported that it had filed for chapter 11 last week, according to The Boston Globe. Citing stiff competition from such chains as Linens`N Things and Bed Bath & Beyond Inc., the New England chain nevertheless is confident that it will ultimately emerge from bankruptcy protection and has made no announcements about possible layoffs or store closings. The company anticipates full inventory for the holidays and no interruption in business. BRADLEES, INC.: Supplements Prospectus for New Stock/Notes ----------------------------------------------------------- Bradlees, Inc., has delivered a Supplement to its Prospectus filed on Form S-1 with the SEC, registering 7,267,424 shares of Common Stock in Bradlees, Inc., and $36,000,000 of 9% Convertible Notes to be issued by Bradlees Stores, Inc., pursuant to the Debtors' recently confirmed Plan of Reorganization. BROOKE GROUP: Redeeming 11.5% Series B & 19.75% Series C Notes -------------------------------------------------------------- On November 25, 1998, Brooke Group announced that Liggett will call for redemption on December 28, 1998 all of its outstanding 11.50% Series B and 19.75% Series C Senior Secured Notes due 1999 (collectively, the "Liggett Senior Secured Notes"). On the redemption date, the $144.9 million principal amount of the Liggett Senior Secured Notes will be redeemed for 100% of the principal amount thereof plus accrued interest. BROOKE GROUP: Selling 3 Cigarette Brands to Philip Morris --------------------------------------------------------- On November 20, 1998, Brooke Group Ltd. and certain of its affiliates entered into an agreement with Philip Morris, Inc., relating to, among other things, the purchase by PM of three of Liggett Group's cigarette brands, L&M, Chesterfield and Lark, and a commitment by Brooke Group and Liggett to join the Master Settlement Agreement recently reached among 46 states, the tobacco industry and others. Philip Morris will make an initial payment of $150 million within 10 days as an option fee, with a $150 million balance to be paid upon exercise of various options by Philip Morris. GLOBALSTAR TELECOMM: Registers Ltd. Partners' Shares ---------------------------------------------------- Globalstar Telecommunications Limited submitted a Prospectus to the SEC last week to register 717,600 shares of common stock for the benefit of entities who acquired shares of GTL common stock from Loral Space & Communications Ltd. on November 5, 1998 in connection with the exchange of limited partnership interests in Globalstar, L.P. for GTL common stock. The Company is represented by Bruce R. Kraus, Esq., at Willkie Farr & Gallagher. GRAND UNION: Reorganized Debtor Reports Operating Losses -------------------------------------------------------- For the eight week period ending October 10, 1998, The Grnd Union Company reports a $19.4 million net loss. On August 17, 1998 (the "Effective Date"), The Grand Union Company (the "Company") consummated its plan of reorganization under Chapter 11 of the Bankruptcy Code (the "Plan of Reorganization") pursuant to the August 5, 1998 Confirmation Order of the United States Bankruptcy Court for the District of New Jersey. Consummation of the Plan of Reorganization has resulted in a capital restructuring of the Company, whereby approximately $600 million in Old Senior Notes has been eliminated from the Company's balance sheet, reducing annual interest expense by approximately $72 million. Consummation of the Plan of Reorganization has resulted in (i) the issuance of 30,000,000 shares of New Common Stock to the holders of the Company's Old Senior Notes; (ii) the issuance of New Series 1, Series 2 and Series 3 Warrants to the holders of the Company's Old Preferred Stock; (iii) the issuance of New Series 1 Warrants to holders of the Company's Old Common Stock; and (iv) cancellation of the Company's Old Senior Notes, Old Preferred Stock, Old Common Stock, Old Series 1 and Series 2 Warrants and Old Stock Options. As of October 1, 1998, the Company's new common stock began trading on the NASDAQ National Market under the ticker symbol GUCO. GREATE BAY: Third Quarter Results Disclosed ------------------------------------------- Winding their way through the chapter 11 process, Greate Bay Casino Corporation and its subsidiaries, posted $25 million in net income (after an extraordinary gain) on $1.5 million in revenues during the third quarter ending September 30, 1998. The Company's balance sheet reflects $21 million in assets available to satisfy $139 million of accumulated debt obligations. HEARTLAND WIRELESS: Third Quarter Results ----------------------------------------- Shareholder equity plunged and operating losses soared during the third quarter at Heartland Wireless Communications, Inc. Wireless cable television and high-speed Internet access businesses are capital intensive, the company reminds investors. Since inception, the Company has expended funds to lease or acquire channel rights and operating subscription video systems in various markets, to construct new subscription video systems and a developmental Internet access business, and to finance system operating losses. The Company's primary sources of capital have been from subscription fees, debt financing, the sale of the Company's common stock and the sale of wireless cable channel rights that were not part of the Company's strategic plan. The growth of the Company's businesses requires substantial investment in capital expenditures for SFU and MDU video subscriber growth, the development of alternative spectrum usages such as high-speed Internet services and the launch of additional markets. The recent approval by the FCC of flexible two-way use of the Company's spectrum could open new applications such as high-speed two-way data and fixed wireless local-loop telephony services that would require additional capital resources to develop and implement. All that said, however, the Company does not expect to generate sufficient cash flows to implement its business plan and service its existing indebtedness. In January 1998, the Company retained Wasserstein Perella & Co., Inc. as its financial advisor to assist the Company in evaluating the options available to finance the Company's business plan and recapitalize the Company. In June 1998, the Company began discussions with an unofficial ad hoc committee purporting to represent the holders of at least 66 2/3% of the principal amount of the Company's $115 million 13% Senior Notes ("13% Notes") due 2003 and $125 million 14% Senior Notes ("14% Notes") due 2004 (collectively, the "Senior Notes") regarding a restructuring and/or recapitalization of the Senior Notes. On October 6, 1998, the Company announced that it had reached an agreement with the holders of a majority in principal amount of the Senior Notes to support a plan of reorganization (the "Plan of Reorganization"). This Plan of Reorganization, if consummated, will convert the Senior Notes, the Company's $40.2 million original principal amount of 9% Convertible Subordinated Discount Notes due 2004 (the "Convertible Notes"), certain litigation claims and existing common stock into new common stock and warrants of the reorganized Company. The Company intends to implement the Plan of Reorganization by filing a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code ("Chapter 11") as soon as practical, and seeking confirmation of the Plan of Reorganization as promptly thereafter as possible. There can be no assurance that, if filed, such Plan of Reorganization will be confirmed or consummated. HONDO OIL: Special Shareholders' Meeting December 23 ---------------------------------------------------- Hondo Oil & Gas Company has notified its shareholders that a Special Meeting of Stockholders will be held on December 23, 1998 at 10:00 a.m., New York Time, at the offices of Parker Chapin Flattau & Klimpl, 18th Floor, 1211 Avenue of the Americas, New York, New York 10036, for the following purposes. 1. To consider and vote upon a proposal to adopt an Agreement and Plan of Merger, dated October 12, 1998 (the "Merger Agreement"), by and among the Company, HOGC Acquisition Corporation (the "Purchaser"), a Delaware corporation and an indirect wholly owned subsidiary of Lonrho Plc (the "Parent"), and the Parent, and to approve the related proposed merger (the "Merger") of the Purchaser with and into the Company. As a result of the Merger, the Company will become a wholly owned subsidiary of the Parent and each issued and outstanding share of Common Stock, par value $1.00 per share (the "Shares"), of the Company (other than Shares owned by the Parent or any subsidiary of the Parent, Shares held in treasury by the Company and Shares held by stockholders who perfect appraisal rights under Delaware law) will be converted into the right to receive $0.05 per Share net in cash, without interest thereon. The Merger and the Merger Agreement are more fully described in the attached Proxy Statement which forms a part of this Notice. 2. To transact such other business as may properly come before the Special Meeting. Hondo advises its shareholders that, on October 9, 1998, a Special Committee of the Board of Directors of the Company, consisting solely of Directors not affiliated with Parent, and the entire Board of Directors of the Company, unanimously determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are fair to and in the best interests of the unaffiliated stockholders of the Company, and approved the Merger Agreement and the transactions contemplated thereby, including the Merger. Houlihan Lokey Howard & Zukin Financial Advisors, Inc. serves as the financial advisor to the Special Committee of the Board of Directors of the Company. A copy of Houlihan's fairness opinion was filed under cover of Schedule 13E-3 with the SEC; a full-text copy of the document is available at no charge at http://www.sec.gov/cgi-bin/srch- edgar?HONDO+adj+OIL+and+19981125 via the Internet. HUNGARIAN BROADCASTING: Announces Quarterly Results --------------------------------------------------- Financial deterioration continued during the third quarter as Hungarian Broadcasting Corp. reported a $4,620,572 quarterly loss. Year to date, HBC has lost in excess of $13 million. The Company has historically derived its cash for capital expenditures, working capital and operations primarily from investor financing. The Company expects over the medium term to continue to need investor financing to fund its operations. LANDCARE USA: Gabriel & Ariel Hold 7.5% Equity Stake ---------------------------------------------------- Gabriel Capital, L.P., Ariel Fund Limited, Ariel Management Corp., and J. Ezra Merkin disclose in an SEC filing that they hold a 7.5% equity stake in Texas-based agriculture service company Lancare USA, Inc. LATTICE SEMICONDUCTOR: Seligman Reports 9.82% Equity Stake ---------------------------------------------------------- J. & W. Seligman & Co. Incorporated, Seligman Communications and Information Fund, Inc. and William C. Morris disclosed in an SEC regulatory filing that they beneficially own 2,301,503 shares in Lattice Semiconductor, Inc., representing a 9.83% equity stake. MARTIN COLOR-FI: UVEST Lightens Equity Stake -------------------------------------------- UVEST Financial Services Group, Inc. d/b/a SunBelt Capital Management disclosed in a Schedule 13-G filed with the SEC that it has reduced its equity stake in Martin Color-Fi, Inc., to 4,400 shares, representing 0.01% of the Company's outstanding common stock. MARVEL ENTERTAINMENT: Third Quarter Results of Operations --------------------------------------------------------- For the three-month period ending September 30, 1998, Marvel Entertainment Group, Inc., reports a $24.3 million loss on $70.3 million in net sales. For the nine-month period ending September 30, 1998, Marvel reports a $56.2 million loss on $273.5 million in net sales. As previously reported, Marvel along with eight of its operating and inactive subsidiaries commenced cases under Chapter 11, Title 11 of the United State Code by filing voluntary petitions for relief in the United States Bankruptcy Court for the District of Delaware. In November 1997, the United States District Court for the District of Delaware withdrew the order referring the Marvel Cases to the Bankruptcy Court. On July 30, 1998, Marvel, Toy Biz, Inc. and its subsidiaries, the secured creditors, the official committee of unsecured creditors, the official committee of equity holders and other interested parties reached a global settlement and on July 31, 1998, the District Court approved the settlement and confirmed the Fourth Amended Plan of Reorganization (the "Toy Biz Plan"). The consummation of the Toy Biz Plan occurred on October 1, 1998. In connection with the consummation of the Toy Biz Plan as of October 1, 1998, outstanding debt of approximately $576.8 million (excluding Panini debt) was extinguished. Toy Biz paid approximately $446.9 million in cash and securities directly to the banks for the extinguishment of debt and for the acquisition of the Company. MEGO MORTGAGE: Delays Filing Annual Report on Form 10-K ------------------------------------------------------- Mego Mortgage Corporation advises the SEC that it will be tardy in filing its Form 10-K for the latest fiscal year. Mego explains that, during the last fiscal year, the Company has substantially changed its business. As a result, Deloitte & Touche, the Company's auditors, require additional time to fully complete their audit of the financial statements necessary to complete the required filing. The Company's asserts that its inability to file in a timely manner could not be eliminated by the Company without unreasonable effort or expense. The Company assures the SEC that will file its Annual Report on Form 10-K no later than the 15th calendar day following the prescribed due date. MONTGOMERY WARD: HQ Buyer Returns With Different Offer ------------------------------------------------------ After more than four months of due diligence, Ocean Atlantic Development Corp., the contracted buyer of Montgomery Ward's 28-acre Chicago headquarters compound, has returned to the table with a different offer. "We have received a new offer from Ocean Atlantic, which varies the structure of the prior agreement, and we're in the process of evaluating it," said Chuck Knittle, a spokesman for the retailer. Knittle declined to comment on the discussions under way or to provide details of any changes Ocean Atlantic has proposed, including whether, as speculated, the new offer provides for a lower sum than originally proposed. Stalking horse Ocean Atlantic had offered $110 million for the property, which includes a parking garage, merchandise building, catalog building, and 27-story corporate tower, home of Montgomery Ward's corporate offices. (Federal Filings Inc. 02-Dec-98) MRS TECHNOLOGY: October, 1998 Monthly Operating Report ------------------------------------------------------ For the month ending October 31, 1998, MRS Technology, Inc., filed its monthly operating report with the U.S. Bankruptcy Court in Massachusetts. MRS filed a copy of the report under cover of Form 8-K with the SEC. A full-text copy of the report is available at no charge at http://www.sec.gov/cgi-bin/srch- edgar?MRS+adj+TECHNOLOGY+and+8-K via the Internet. NUMED HOME: CEO Resigns at Turkey Vulture's Behest -------------------------------------------------- Turkey Vulture Fund XIII, Ltd., announced that, on the morning of November 24, 1998, counsel for the Fund was notified by NuMED Home Health Care, Inc. that NuMED and Jugal K. Taneja, the Company's Chief Executive Officer and Chairman of the Board, had reached an agreement whereby Mr. Taneja would relinquish his duties as the Chief Executive Officer and Chairman of the Board, and Susan J. Carmichael, the existing President of the Company, would be appointed as the Chief Executive Officer of the Company. Mr. Taneja, however, will remain as a director of the Company. No details of the agreement with Mr. Taneja or Ms. Carmichael have been made public. The Committee for a New NuMED (the "Committee"), of which Richard M. Osborne, the sole Manager of the Fund, is a member, immediately responded to the announcement of Mr. Taneja's agreement by sending a letter from its counsel to Thomas V. Chema, a director of the Company, regarding the implications of Mr. Taneja's agreement to the Committee's plans with respect to the Company. In the letter, the Committee stated that it was pleased that the Board of Directors accomplished one of the Committee's primary goals with the removal of Mr. Taneja as Chairman of the Board and Chief Executive Officer. However, the Committee stated that it was necessary for Mr. Taneja to sever all ties with the Company, including resigning as a director. NUMED HOME: Turkey Vulture Fund Sued ------------------------------------ Turkey Vulture Fund XIII, Ltd., discloses in a Form 13 filed with the SEC last week that it holds a 10.2% equity stake in NuMed Home Health Care, Inc., and has been sued by NuMed. Under Item 5 to NuMed's Form 10-Q for the quarter ended September 30, 1998, which was filed with the SEC on November 20, 1998, NuMed states, in part, that "[o]n November 24, [sic] 1998 [NuMed] filed a lawsuit due to the violation of the Section 13(D) [sic] filing." The NuMed Form 10-Q fails to elaborate what if any violation of Section 13(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), there may have been and further fails to state against whom the lawsuit has been filed. Counsel to the Fund received a copy of the complaint on November 23, 1998, although the Fund has not been served with a copy of the complaint. A copy of the complaint in NUMED HOME HEALTH CARE, INC. V. TURKEY VULTURE FUND XIII, LTD. (U.S. Dist. Ct., Florida, Tampa Division, No. 98-2354-CIV-T-17F) is attached as Exhibit 7.4 to Form 13-D filed November 25, 1998 and is available at no charge at http://www.sec.gov/cgi-bin/srch- edgar?NUMED+adj+HOME+and+19981125 via the Intenet. The complaint alleges that (1) the Fund failed to file an amendment to its Schedule 13D indicating that it "is attempting to gain control of NuMed through a proxy fight, oust current management, and eliminate NuMed's staggered Board of Directors" and (2) the Fund failed to file an amendment to its Schedule 13D regarding the purchase of the additional 23,500 shares reported herein as having been acquired by the Fund. The complaint seeks (a) a temporary and permanent injunction requiring the Fund to file an amendment to its Schedule 13D "which will accurately reflect its true purpose," (b) a temporary injunction enjoining the Fund from exercising voting rights and soliciting proxies during the pendency of the lawsuit and "an appropriate 'cooling-off period,'" (c) costs and attorneys' fees, and (d) such other relief as the Court deems just and appropriate. The Fund can only assume that the lawsuit has been filed against it as an attempt by management to delay the outcome of the annual meeting, thereby further entrenching itself. In addition, the Fund can only assume that because NuMed has failed to make its proxy statement public it has a further incentive to delay the meeting. The Fund denies that there has been any violation of Section 13(d) of the Exchange Act or the rules and regulations promulgated by the SEC thereunder. All the required disclosure regarding the change in the Board of Directors and the By-laws was made on a prompt and timely basis in the Preliminary Proxy Statement. If, and when, the Fund is served with a copy of the lawsuit, the Fund will vigorously defend itself, including taking all necessary steps to insure that the stockholders of NuMed have the opportunity to elect a Board of Directors. ONCOR, INC.: Surrenders Assets to Satisfy Debt Obligation ----------------------------------------------------------- Oncor, Inc., announced that it has voluntarily surrendered assets related to its in situ Hybridization business to certain of the Company's secured creditors who, as previously announced, had declared Oncor to be in default of its obligations. Ventana Medical Systems, Inc. (VMSI) has acquired Oncor's in situ Hybridization business assets from the Company's secured creditors with Oncor's consent. The aggregate consideration paid by Ventana for those assets was $5.0 million in cash at closing and an additional $0.5 million conditional consideration. All rights to the INFORM(R)HER- 2/neu test were conveyed to Ventana, in addition to accounts receivable, inventory, equipment and intellectual property related to all other products sold commercially by Oncor for cancer research purposes. Approximately $4.1 million of the proceeds were used to satisfy the full amount owed by Oncor to the secured creditors who had declared Oncor to be in default. This transaction is part of the company's previously announced plan to reduce its scope of operations and on-going operating expenses in order to meet its past due obligations to trade creditors and a potential redemption right of preferred stockholders. The remainder of the proceeds from this transaction will be used to continue to implement the plan and to reduce its obligations to trade and other creditors. OPHTHALMIC IMAGING: Shareholder Meeting on January 7 ---------------------------------------------------- Premier Laser Systems, Inc., the 51.3% controlling shareholder in Ophthalmic Imaging Systems, Inc., disclosed last week that, on November 20, 1998, OISI delivered a letter to Premier confirming, among other things, that OISI had established and publicly disclosed January 7, 1999 as the date of its next annual shareholders' meeting. In that same letter, OISI agreed to not change or reschedule the date of the Meeting without Premier's written consent. In contemplation of the board of directors election to be held at the Meeting, Premier intends to supply OISI with a proposed slate of qualified board of director candidates. Premier anticipates that OISI's current CEO, Steve Verdooner, will remain as a board member. Premier's proposed slate will not, however, include any other current OISI officers or directors, nor will the slate include any officers or directors of Premier. Assuming that the slate is acceptable to OISI's current board of directors, Premier believes that OISI will include the slate in OISI's proxy statement for the Meeting. Premier makes it clear that it has no current plans to acquire additional securities of OISI. It is possible, however, that Premier could acquire additional shares of OISI in the future. Premier and OISI are currently in the process of negotiating certain aspects of their relationship, including the repayment by OISI of certain indebtedness of OISI to Premier. OXFORD HEALTH: Amends Stock Purchase Agreement ---------------------------------------------- Oxford Health Plan, Inc., entered into an agreement amending and supplementing stock purchase agreements with TPG Partners II, L.P., TPG Oxford LLC, TPG Parallel II, L.P., and TPG Investors II, L.P. The new agreement extends standstill provisions contained in Oxford's Investment Agreement with TPG and permits individuals who are affiliates of TPG to purchase, in the aggregate, up to 2,000,000 shares of Common Stock. Copies of the agreements are filed by TPG under cover of Forms 13 with the SEC and are available at no charge via the Internet at: http://www.sec.gov/cgi-bin/srch-edgar?OXFORD+adj+HEALTH PAYLESS CASHWAYS: Cuts Four Executive Jobs ------------------------------------------ The Kansas City Star reports on December 2, 1998 that Payless Cashways Inc. on Tuesday announced the elimination of four upper-level positions, including that of Robert S. Islinger, senior vice president of marketing and strategic planning. The three other positions Payless cut were divisional merchandise managers, reducing the number to six. At the same time, the company plans to beef up its assistant buying staff in a continuation of its restructuring. The goal, said Shawn J. Hepinstall, vice president of marketing, is to allow the buyers to have more direct contact with customers, store managers and vendors. However, at least one analyst said he was a bit confused about changes Payless has made since new management took over last year and Millard Barron was hired as chief executive officer. Barron is a former longtime Wal-Mart Stores Inc. executive. In May, the company announced its "new" strategy to serve both the do-it-yourself consumer and the professional contractor. The difference between the two is that under dual path one or two stores in each major market are dedicated almost solely to the professional, while the remaining stores focus mostly on do-it-yourselfers. Company spokeswoman Linda Ward said it was never the intention of the company to abandon the do-it-yourself consumer. "The goal is to grow the professional side while retaining the almost $1 billion spent by consumers in our stores each year," Ward said. "We're not going to walk away from that." PEGASUS GOLD: $20M Financing Offer From Standard Bank ----------------------------------------------------- Pegasus Gold Corp. received court approval to pay Standard Bank London Ltd. a $50,000 nonrefundable fee in connection with a proposed $20 million post-confirmation working capital facility. The recent offer from Standard bested an Oct. 13 proposal for a $17.5 million facility underwritten by GE Capital Corp. The GE Capital offer required an underwriting deposit of up to $250,000. Four of the mining company's subsidiaries, Pegasus Gold International Inc. (to be renamed Apollo Gold Corp.), Diamond Hill Mining Inc., Florida Canyon Mining Inc., and Montana Tunnels Mining Inc., are seeking the new credit facility pursuant to their proposed joint plan of reorganization. Borrowings under the proposed one-year facility would bear interest at LIBOR plus 300 basis points. (The Daily Bankruptcy Review and ABI Copyright c December 2, 1998.) PORTACOMM WIRELESS: Restates Balance Sheet ------------------------------------------ As previously reported, Portacomm Wireless, Inc., obtained confirmation of its liquidating plan on September 17, 1998, from the U.S. Bankruptcy Court. The company has adjusted its balance sheet to reflect assets and liabilities at fair value in light of plan confirmation. Those adjusted values are reported in the Company's Form 10-Q for the period ending September 16, 1998. A full-text copy of the filing is available at no charge at http://www.sec.gov/edgar/Archives/data/0000907166/000101706 2-98-002364.txt via the Internet. QUADRAX CORPORATION: Third Quarter Results Announced ---------------------------------------------------- For the three-month period ending September 30, 1998, Quadrax Corporation reports a $17,614 net loss on $4.6 million in net sales. For the nine-month period ending September 30, 1998, Quadrax reports a $2.2 million net loss on $13.5 million in net sales. Quadrax management attributed its reduced third quarter loss to the absence of any losses incurred from the suspended operations of the company's thermoplastic operations in Rhode Island and California due to the Chapter 11 bankruptcy filing. SA TELECOMMUNICATIONS: July 1998 Monthly Operating Report --------------------------------------------------------- SA Telecommunications, Inc., and its subsidiaries filed their Monthly Operating Report for the month of July, 1998, with the United States Bankruptcy Court for the District of Delaware. Simultaneously, the Company filed a copy of the financial statement with the SEC under cover of Form 8-K. A full-text copy of the filing is available at no charge at http://www.sec.gov/cgi-bin/srch- edgar?SA+adj+TELECOMMUNICATIONS+and+19981125 via the Internet. SANTA FE GAMING: Pioneer Amends Exchange Offer ---------------------------------------------- Pioneer Finance Corp. ("Pioneer"), a subsidiary of Santa Fe Gaming Corporation, a diversified gaming company headquartered in Las Vegas, announced today that it is amending its outstanding exchange offer and consent solicitation launched on October 23, 1998 with respect to its 13-1/2% First Mortgage Bonds due December 1, 1998 (the "Pioneer Notes"), and that an unofficial group of holders (including the single largest holder) have agreed to tender their Pioneer Notes and furnish consents. In the amendment to the exchange offer, Pioneer is amending the terms of the securities offered in exchange for the Pioneer Notes by, among other things, providing for an event of default in December 1999 if certain repurchases of the new notes have not been consummated by that date. The consent solicitation is amended by, among other things, lowering the principal amount of Pioneer Notes with respect to which consents must be received from $47 million to $42 million, by providing for certain defaults that would permit termination of the consents by amending the Pioneer Notes in certain respects. A Supplement to the October 23, 1998 Offering Circular and Consent Solicitation Statement describing the amendments is being mailed to holders of the Pioneer Notes; copies of the Supplement may be obtained by contacting Thomas K. Land, Chief Financial Officer of Santa Fe Gaming, at 702-658-4340. In connection with the amendments, Pioneer has extended the expiration date of both the exchange offer and of the consent solicitation to 5:00 P.M., New York City time, on Tuesday, November 24, 1998. The exchange offer and consent solicitation were previously scheduled to expire at 12:00 midnight on Friday, November 20, 1998. Santa Fe Gaming Corporation owns and operates the Santa Fe Hotel and Casino in northwest Las Vegas and the Pioneer Hotel & Gambling Hall in Laughlin, Nevada. In addition, the Company holds several real estate parcels for future development within or in the area surrounding Las Vegas, Nevada. SIZZLER INTERNATIONAL: Half-Year Results Announced -------------------------------------------------- For the 24 weeks ending October 18, 1998, Sizzler International, Inc., and its subsidiaries report $3.6 million in net income. On June 2, 1996, the Company enacted a comprehensive restructuring strategy designed to return the U.S. operations to profitability. This strategy included the closure of under-performing restaurants in the U.S. and filing for bankruptcy protection through a Chapter 11 proceeding. On June 2, 1996, the Company and four subsidiaries, Sizzler Restaurants International, Inc. ("SRI"), Buffalo Ranch Steakhouses, Inc. ("BRSH"), Tenly Enterprises, Inc. (Tenly"), and Collins Properties, Inc. ("CPI"), became debtors-in-possession subject to the supervision of the U.S. Bankruptcy Court of the Central District of California (the "Bankruptcy Court") under Chapter 11 of the federal bankruptcy code. On June 2, 1997, the Bankruptcy Court entered an order confirming the Chapter 11 plans of reorganization of the Company, SRI and CPI. The plans of reorganization for Tenly and BRSH were confirmed on February 24, 1997. On September 23, 1997, the reorganization plans became effective and the Company and its subsidiaries emerged from the bankruptcy proceedings. The Company and its subsidiaries have paid approximately $79 million in pre-petition claims and interest and reinstated the remaining pre-petition liabilities. SPECTRUM INFORMATION: May File Another Chapter 11 ------------------------------------------------- Spectrum Information Technologies, Inc. filed its quarterly report with the SEC for the quarterly period ended September 30, 1998. In June 1998, Spectrum began seeking to raise capital to commercialize and market its FastLane service, and hired an investment bank in July and another in August to assist this process. Having failed to identify an investor, Spectrum announced on October 2, 1998 that it would continue to seek an investor and consider tender offers. Spectrum retained two additional consultants to assist and broaden its efforts in locating an acquirer of the Company or the technology. Notwithstanding this extensive effort, as of the date of this report, Spectrum has been unable to raise capital or attract a tender offer. Of the companies that Spectrum has contacted, virtually all have declined and the Company is pursuing those contacts that are still outstanding. The Company expects to resolve these outstanding contacts by the end of November 1998. If these few open contacts do not yield an investor or acquirer, the Company plans to seek bankruptcy protection under Chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code"). A full-text copy of the filing is available via the Internet at: http://www.sec.gov/Archives/edgar/data/0000903423-98- 000397.txt SUN TV: First Ever Internet GOB Sale ------------------------------------ Universal Capital Group revolutionized the liquidation industry last week when it announced that it has formed the Redtag Outlet (www.redtagoutlet.com) to conduct the first-ever Internet going-out-of-business sale for Sun Television & Appliances, an Ohio based consumer electronics retailer that once operated 59 stores in six states. Universal Capital Group, through Universal/Petters LLC, was one of five companies to submit bids to handle the inventory liquidation for 30 of Sun's closing outlets. Universal provided the highest bid and was appointed sole liquidator by the U.S. Bankruptcy Court - Delaware District for the 30 outlets. "Universal secured the winning bid on the liquidation by taking advantage of the tremendous marketing opportunities available through the Internet," said Michael Catain, Universal President and COO. "Sun will now reach a much broader consumer group, in fact, a nationwide audience for the sale of its inventory, versus advertising only locally to consumers in the markets in which its operates." "What this does is enables Universal to maximize the value of the liquidation proceeds to creditors, while significantly reducing the length of time to complete the liquidation sale. At the same time, because the cost of doing on-line business is significantly lower than operating a retail store, we are still able to offer tremendous bargains to on-line shoppers." Online bargain-hunters will find "The Greatest Deals in Cyberspace" as Redtag Outlet (www.redtagoutlet.com) features cameras, camcorders, VCRs and more at below-wholesale prices. Plus, you can get this merchandise delivered free-of-charge, whether you live in Ohio or Alaska. Redtag Outlet accepts all major credit cards and guarantees safe transactions via secure browsers. All merchandise offered in the Sun going-out-of-business sale is in new, factory-sealed packaging. Universal Capital Group is headquartered in Minneapolis, Minnesota. TAPISTRON INTERNATIONAL: 1998 Annual Meeting Scheduled ------------------------------------------------------ Shareholders of Tapistron International, Inc., are advised that the Company will hold its annual meeting on January 7, 1999, at 1:00 p.m., local time, at the Northwest Georgia Trade and Convention Center in Dalton, Georgia, for the following purposes: 1. To elect two (2) Class II directors to serve a three- year term or until their successors have been duly elected and qualified. 2. To ratify the selection of Dudley, Hopton-Jones, Sims & Freeman PLLP as the Company's independent auditors for the 1999 fiscal year. 3. To approve directors' fees of $100.00 per each director for each board meeting attended to defray personal expenses. 4. To transact such other business as may properly come before the meeting or any adjournment thereof. USN COMMUNICATIONS: Shareholder Files Suit ------------------------------------------ Counsel for Class Plaintiff, Barrack, Rodos & Bacine, today issued the following: A class action has been commenced in the United States District Court for the Northern District of Illinois on behalf of all persons who purchased the common stock of USN Communications, Inc. (Nasdaq: USNC) ("USNC" or the "Company") between February 4, 1998 and November 3, 1998, inclusive (the "Class Period"). The complaint charges USNC -- a competitive local exchange carrier -- and certain officers and directors of the Company during the relevant time period with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as well as violations of Sections 11, 12(a)(2), and 15 of the Securities Exchange Act of 1933. The complaint alleges that defendants made false and misleading representations in connection with USNC's February 4, 1998, $128 million initial public offering of 8 million shares of common stock (the "IPO" or the "Offering"). The Complaint alleges that, in the Company's IPO Prospectus and in statements made thereafter, defendants described the Company as being involved in reselling local telephone services and that the Company's business of reselling services was becoming increasingly successful. In truth, however, defendants knew, or were reckless in not knowing, that profit margins on reselling local service made it virtually impossible for that strategy to be profitable and that the Company would be forced to switch to a non- reselling strategy, including the possible building or leasing of its own systems, to make the Company profitable. During the Class Period, the company was in fact forced to recede from its pure reselling strategy and belatedly began to build its own network. However, the change in strategy was too late and, as defendants knew all along, required a huge infusion of capital, which the Company lacked. On November 3, 1998, the day after the Company announced massive restructuring and lay-offs, USNC's stock closed at $3/8 per share -- an all-time low. The Complaint alleges that members of the Class purchased their shares of USNC common stock at artificially inflated prices. The plaintiff seeks to recover damages on behalf of all purchasers of USNC common stock during the Class Period. WELCOME HOME: Corrects Clerical Errors in Latest Form 10-Q ---------------------------------------------------------- Welcome Home, Inc., tells the SEC that it discovered clerical errors in the filing of the Company's Form 10-Q for the period ended October 3, 1998. These errors are contained in the "Notes to Consolidated Financial Statements". Accordingly, the Debtor has resubmitted the corrected footnotes under cover of Form 10-Q/A. As previously reported, the retail concern filed for chapter 11 protection on January 21, 1997, in the United States Bankruptcy Court for the Southern District of New York. The filing is intended to allow the Company to restructure its financial obligations through a plan of reorganization. Fleet Capital Corporation has extended a post-petition credit facility to the Company to enable it to continue to conduct its business while the bankruptcy proceeding is pending. *********** 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. 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