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/raid1/www/Hosts/bankrupt/TCR_Public/991115.MBX T R O U B L E D C O M P A N Y R E P O R T E R Monday, November 15, 1999, Vol. 3, No. 221 Headlines CALIFORNIA COASTAL: No Revenue Expected 'Til Early 2000 CORAM HEALTHCARE: Announces Third Quarter Results CORAM HEALTHCARE: Resource Network Subsidiaries File Chapter 11 DANKA BUSINESS: Equity Firm Investing $200 Million In Shares EASTWIND AIRLINES: Lawsuits Over Contract Dispute/Back Pay EUROWEB INTERNATIONAL: Deutsche Bank Holds 880,000 Stock Shares FLORIDA COAST PAPER: Disclosure Statement GREATE BAY CASINO: Reports Third Quarter Results GREATER SOUTHEAST: Legal Wrangling Continues HARNISCHFEGER: Notice of Auction KIWI: Viking Resources Makes Bid MARVEL ENTERPRISES: Revenue Increasing Over 1998, Losses Continue MEDPARTNERS PROVIDER NETWORK: Chapter 11 Plan MERRY-GO-ROUND: Fidelity Takes-Up Contingency Fee Dispute MOSSIMO: Quarter Ended September 30, 1999 Yields $1 M Net Income MOUNT AIRY LODGE: Files For Bankruptcy After Death of Owner ORANGE COUNTY: Judge Rejects $48 Million Bonus Request PAGE AMERICA: Asset Liquidation May Not Benefit Stockholders PRAEGITZER INDUSTRIES: Tender Offer From Tyco & Tyco Subsidiaries PREMIER LASER: OIS/Premier Agree To Preferred Stock Purchase PREMIER LASER: Upon Merger OIS To Become Subsidiary Of Premier PURINA MILLS: Chase Bank Objects to Houlihan, Lokey RINCON ISLAND: Order Approves First Amended Disclosure Statement RITE AID: Explores Sale of West Coast Stores to Reduce Debt Load SPECTRUM INFORMATION: Annual Meeting Has Purposeful Agenda SUN TV: Seeks Confirmation Hearing Date for Liquidating Plan TELEGEN: Signs Investment Banking Agreement THE PHARMACY FUND: Hearing To Consider Disclosure Statement VENCOR: Announces Third Quarter Results WINDSOR ENERGY: Order Approves First Amended Disclosure Statement WIRELESS ONE: Entry of Order Confirming Plan ********* CALIFORNIA COASTAL: No Revenue Expected 'Til Early 2000 ------------------------------------------------------- California Coastal Communities Inc.is a residential land development and homebuilding company with properties located primarily in Southern California. The principal activities of the company and its consolidated subsidiaries include: (i) obtaining zoning and other entitlements for land it owns and improving the land for residential development; (ii) single-family residential construction in Southern California; and (iii) providing residential real estate development services to third parties. Once the residential land owned by the company is entitled, the company may sell unimproved land to other developers or homebuilders; sell improved land to homebuilders; or participate in joint ventures with other developers, investors or homebuilders to finance and construct infrastructure and homes. In April 1998, the company sold its commercial development business, and accordingly its financial statements have been reclassified to present the commercial development business as discontinued operations. During the balance of 1999 and 2000, the company indicates it will focus its immediate efforts to (i) obtain approval from the California Coastal Commission for modifications to the Local Coastal Program for the Warner Mesa project in accordance with the courts' decisions; (ii) complete the secondary permitting for development of Warner Mesa; and (iii) commence infrastructure construction on Warner Mesa as soon as possible; however, the company may also consider other strategic and joint venture opportunities. There can be no assurance that the California Coastal Communities Inc. will accomplish, in whole or in part, all or any of these goals. In reporting its gain or loss for the nine-month period ending September 30, 1999 the company showed zero revenue and a net loss of $2.2 million. In the same period of 1998 the company had revenue of $2.1 million and net income of $5.3 million. The company does not expect to report any revenues until the first quarter of 2000, when the delivery of homes is scheduled to commence at its 112-home Rancho San Pasqual project in Escondido, California. CORAM HEALTHCARE: Announces Third Quarter Results ------------------------------------------------- Coram Healthcare Corporation (NYSE:CRH), today announced financial results for the third quarter ended September 30, 1999. Despite sequential improvements in the company's infusion therapy business during the quarter, the period's results were impacted by losses in the subsidiaries that operate its Resource Network division ("R-Net"), and by a charge and incremental expenses related primarily to the wind-down of this division. Before the one-time charge and related incremental expenses, the company reported a loss for the quarter of ($ 8.4) million or ($0.17) per diluted share. The loss for the quarter, including this charge and related incremental expenses, was ($15.2) million or ($0.30) per diluted share. For the quarter ended September 30,1999, Coram reported net revenues of $143.2 million, compared to total net revenues of $143.6 million reported for the third quarter ended September 30, 1998. These results include a $14.0 million decline in the company's R-Net revenues, on a year-over-year quarter basis, due primarily to the June 30, 1999 termination of the Master Agreement, effective May 1, 1998, between Coram Healthcare Corporation and Aetna U.S Healthcare, Inc. ("Aetna"). For the nine months ended September 30, 1999, Coram's net revenues were $ 456.9 million, a 24.0 percent increase over total net revenues of $368.5 million for the nine months ended September 30, 1998. In a separate statement, the company also announced today that the R-Net subsidiaries filed voluntary petitions with the U.S. Bankruptcy Court for the District of Delaware under chapter 11 of the U.S. Bankruptcy Code. The filings do not include, and should not effect, other Coram operations. "Third quarter results and subsequent events demonstrate we are making significant progress in our effort to restore the company's profitability. We made improvements in our base infusion therapy business and we are moving ahead with our planned future sale of our prescription service division. All of this progress, together with R-Net's decision to stem its losses through a quick wind-down of operations, will contribute to an improvement in Coram's financial performance in the coming year," said Donald J. Amaral, chairman and interim chief executive officer of Coram Healthcare Corporation. R-Net's business is managing a network of contract providers, on behalf of managed care organizations. R-Net revenues were $10.3 million, or 7.2 percent of total Coram revenues for the quarter. Segment losses in the company's R-Net subsidiaries accounted for approximately ($3.8) million or almost one-half of the company's loss, before the one-time charge, for the quarter. The company also announced that it is in discussions with its principal debt holders concerning certain covenants and other provisions of its principal debt agreements. -- A special charge of $5.1 million related to the company's restructuring of its R-Net subsidiary operations, including employee severance, reserve for lease expenses, and the write-down of impaired assets. -- Related incremental expenses of $1.7 million for legal and professional fees in connection with the company's litigation with Aetna, and for professional fees related to the preparation of the company's R-Net subsidiary filing of voluntary petitions under chapter 11 of the U.S. Bankruptcy Code. Coram's infusion therapy net revenue declined approximately three percent, while EBITDA improved 29.0 percent, on a sequential basis. Coram Prescription Services revenue increased 73.6 percent over revenue reported for the third quarter of 1998. Coram's Clinical Trials and Medical Informatics signed agreements for 10 new studies during the quarter, totaling $2 million of revenue over the lives of the studies. Total current studies now number 15. Denver-based Coram is a leading provider of high quality home infusion therapy operating from 88 locations in 43 states and Ontario, Canada. Coram's Prescription Services Division provides pharmacy benefit management services as well as mail order prescription drugs for chronically ill patients. The Clinical Trials and Medical Informatics Division provides home care and product development services to pharmaceutical, biotechnology and medical device companies sponsoring clinical trials. CORAM HEALTHCARE: Resource Network Subsidiaries File Chapter 11 --------------------------------------------------------------The Resource Network subsidiaries of Coram Healthcare Corporation (NYSE:CRH), announced that it filed voluntary petitions with the U.S. Bankruptcy Court for the District of Delaware under chapter 11 of the U.S. Bankruptcy Code. The filings do not include, and should not affect, other Coram Healthcare operations which continue to provide home infusion therapies, mail-order pharmacy and prescription benefit management services, clinical research, and medical informatics. Coram Healthcare, in a separate press release, today announced third quarter operating results for the period ending September 30, 1999. The business of Coram Resource Network, Inc. and Coram Independent Practice Association, Inc. (collectively "R-Net") is managing a network of contract providers, on behalf of managed care organizations. R-Net revenues were $10.3 million, or 7.2 percent of total Coram Healthcare revenues of $143.2 million, for the third quarter ended September 30, 1999. R-Net has sustained substantial losses in recent periods. Coram believes, and has alleged in a lawsuit, that the R-Net losses have resulted primarily from breaches, and other misconduct, of an agreement the company had with a managed care insurer. In its suit, Coram is seeking to recover compensatory and punitive damages. "The losses sustained by R-Net could not be overcome without a resolution of the pending litigation. Consequently, the best course of action for R-Net is to discontinue operations and the best course of action for Coram is to maintain and strengthen its focus on its core operations. Both Coram's infusion therapy business and prescription services division continue to grow in customer base and revenue, and continue to produce positive operating results," said Donald J. Amaral, chairman and interim chief executive officer of Coram Healthcare Corporation. R-Net will phase out operations through an orderly transition of their network management services back to the managed care organizations with which they have contracted. The corporate reorganization and liquidation firm of Walker, Truesdell, Radick and Associates, Inc. has been retained by R-Net, subject to approval of the Bankruptcy Court, to manage the winding-down and discontinuance of R-Net operations during the chapter 11 proceedings. In August 1999, several R-Net providers filed an involuntary bankruptcy petition against R-Net, seeking payment for past due invoices that have not been paid due to Coram's outstanding claims against the insurer. Today's filing converts the involuntary bankruptcy proceeding into a petition for voluntary chapter 11 protection. Denver-based Coram is a leading provider of high quality home infusion therapy operating from 88 locations in 43 states and Ontario, Canada. Coram's Prescription Services Division provides pharmacy benefit management services as well as mail order prescription drugs for chronically ill patients. The Clinical Research and Medical Informatics Division provides home care and product development services to pharmaceutical, biotechnology and medical device companies sponsoring clinical trials. DANKA BUSINESS: Equity Firm Investing $200 Million In Shares ------------------------------------------------------------ On November, 3, 1999, Danka Business Systems PLC and The Cypress Group LLC, a New York based private equity firm, announced that they had entered into a definitive agreement whereby equity investment funds managed by Cypress have agreed to invest $200 million in convertible participating preference shares of Danka. Danka will issue 200,000 new participating shares at a price of $1,000 per share. The new participating shares will be entitled to quarterly dividends equal to the greater of 6.5% per annum and the deemed per annum rate of the ordinary share dividends paid in that quarter. Dividends will be paid in the form of additional participating shares, valued at an amount per share equal to the liquidation preference per share in effect at that time, for the first five years, and thereafter will be paid in cash (except that such dividends may continue to be paid in additional participating shares to the extent that cash dividends are not permitted under the terms of the company's then existing principal indebtedness). The participating shares will be convertible into ordinary shares at a conversion price of $3.125 per ordinary share (equal to $12.50 per ADS), subject to adjustment in certain circumstances. The participating shares will be entitled to vote on an as converted basis which will give their holders voting rights initially corresponding to approximately 21% of the total voting power of Danka's capital stock. The participating shares will have a preference over ordinary shares as to dividends and other distributions and be entitled to a liquidation preference equal to the initial purchase price plus accumulated and unpaid dividends. The company is required to redeem the participating shares after 11 years at the greater of 100% of their liquidation preference and the value of the ordinary shares into which they would then be convertible, in each case plus accumulated and unpaid dividends from the most recent dividend payment date. The company is also required to redeem the participating shares at the holders' options at the greater of 101% of their liquidation preference and the value of the ordinary shares into which they are then convertible, in each case plus accumulated and unpaid dividends from the most recent dividend payment date, upon an earlier change of control of the company. In the event of a change of control within three and one-half years of the initial issuance of the new shares, the company will be required to make additional payments equal to the dividends that would have accumulated through the end of the three and one-half year period, to the extent such dividends were not previously paid. After the fourth anniversary of issuance, the company is permitted to redeem the participating shares at a price equal to the greater of a percentage of their liquidation preference declining from 103.25% and the value of the ordinary shares into which they are then convertible, in each case plus accumulated and unpaid dividends from the most recent dividend payment date. In the case of any redemption at the "as converted" valuation, the payment may be made through delivery of ordinary shares equal to the number into which the redeemed shares could then be converted. Under the terms of the agreement, Danka will expand its Board of Directors from nine to eleven members. Upon closing of the transaction, two representatives from Cypress will be elected to fill the vacancies created by the expansion of the Board. The transaction is subject to various conditions, including, without limitation, (i) approval by Danka's shareholders at an extraordinary general meeting, (ii) obtaining a commitment from a major financial institution to refinance Danka's senior indebtedness on terms reasonably satisfactory to the parties; (iii) obtaining amendments to the company's bank Credit Agreement, TROL Financing Agreements and GE Capital Lease Financing Agreements; (iv) receipt of required regulatory approvals, and (v) other customary conditions. Either party may decline to close if the average closing price of the company's ADSs on the New York Stock Exchange during the 10-day period ending three business days before the scheduled closing date is less that $9.00 per ADR. EASTWIND AIRLINES: Lawsuits Over Contract Dispute/Back Pay ---------------------------------------------------------- Financially troubled Eastwind Airlines Inc. has been slapped with several lawsuits, which contain allegations ranging from breach of contract to failure to pay back wages. The largest lawsuit stems from a May contract that called for Trans Global Airways Inc. to operate a cargo shipping business for Eastwind's then- existing passenger routes. (The Daily Bankruptcy Review and ABI November 12, 1999) EUROWEB INTERNATIONAL: Deutsche Bank Holds 880,000 Stock Shares --------------------------------------------------------------- Deutsche Bank A.G. of Germany reports ownership of 880,000 shares of common stock of Euroweb International Corporation, representing 9.7% of the outstanding shares of common stock of the company. Deutsche Bank A.G. has shared voting and dispositive power over the shares. FLORIDA COAST PAPER: Disclosure Statement ----------------------------------------- Florida Caost Paper Holding Company LLC and its affiliates as debtors and the Ad Hoc Committee of Noteholders filed a proposed Joint Chapter 11 plan. The plan proposes a Plan Trust that will be organized for the sole purpose of liquidating the plan trust assets. Summary of Classification and Treatment of Claims and Interests: Administrative Expense Claims - Estimated Amount of Allowed Claims: $1M -$5M - Paid in full in cash. Federal Priority Tax Claims - 0 - Other Priority Tax Claims - $9M - Cash payment Other Non-Tax Priority Claims - $300,000 - Unimpaired Noteholder Claims - $185M - Impaired Capital Lease Claims - 0- Convenience Claims - $10,000 - Unimpaired General Unsecured Claims, including rejection claims - $16M - Impaired pro rata share Subordinated Debt Claim - $14m - Impaired - Holder shall receive $1M in full satisfaction of its claim. Interests - Impaired - canceled GREATE BAY CASINO: Reports Third Quarter Results ------------------------------------------------ Greate Bay Casino Corporation (OTC Bulletin Board: GEAAQ) today reported a loss from operations of $571,000 for the third quarter of 1999 compared to income from operations of $131,000 for the third quarter of 1998. Revenues amounted to $1.6 million for the third quarters of both 1999 and 1998. For the nine months ended September 30, 1999, the Company reported a loss from operations of $1.2 million on revenues of $5.7 million compared to income from operations of $2.7 million on revenues of $6.2 million for the comparable period of 1998. Greate Bay reported a net loss from all sources of $1.9 million ($.37 per share) for the third quarter of 1999 and net income from all sources of $79.2 million ($15.27 per share) for the nine months ended September 30, 1999, which included $140,000 and $86.1 million, respectively, of gains resulting from elimination of the Company's equity in Pratt Casino Corporation and its subsidiaries which filed for protection under Chapter 11 of the United States Bankruptcy Code on May 25, 1999. Under the terms of a prenegotiated plan of reorganization which was consummated in October 1999, ownership and operating control of these entities by Greate Bay was terminated. Greate Bay reported net income from all sources of $25.2 million ($4.86 per share) for the third quarter of 1998 and net income from all sources of $25.3 million ($4.88 per share) for the nine months ended September 30, 1998, which included $27.5 million and $31.2 million, respectively, attributable to equity in the earnings of and gain on elimination of the negative investment in GB Holdings, Inc. (Holdings) whose primary subsidiary, Greate Bay Hotel and Casino, Inc. (GBHC), owns the Sands(R) Hotel and Casino in Atlantic City, New Jersey. Holdings and GBHC filed for relief under Chapter 11 of the United States Bankruptcy Code in January 1998. Greate Bay does not expect to have any ownership or operating control of GBHC after its reorganization under Chapter 11. In addition, as a result of an agreement entered into with GBHC on June 27, 1998 and approved by the Bankruptcy Court on July 7, 1998, the Company no longer controls the management and operation of the Sands. Consequently, Greate Bay's investment in GBHC together with certain amounts due from GBHC were revalued to a zero basis on July 1, 1998 resulting in a $27.5 million gain. The Company's remaining operations consist primarily of Advanced Casino Systems Corporation, a computer software company which licenses casino information technology systems to the Sands and to Hollywood Casino Corporation, as well as to non-affiliated casino companies. GREATER SOUTHEAST: Legal Wrangling Continues -------------------------------------------- Bankruptcy Judge S. Martin Teel Jr.'s courtroom bustled yesterday, despite the federal holiday, as the fate of financially troubled Greater Southeast Community Hospital continued to be uncertain, The Washington Post reported. Possibly today, the 35-year-old hospital's fate may be determined. If Judge Teel opts for liquidation, more than 1,100 employees will be out of work, and creditors, who are owed $70 million, will begin receiving payments from the proceeds of liquidation. The hospital has agreed to be purchased by Scottsdale, Ariz.-based Doctors Community Healthcare Corp., which assured Teel that it has the financial backing to pay $21 million for the facility and that it plans to complete the transaction by the end of January. Just a week ago, creditors unanimously favored liquidation in order to get the most money out of the bankruptcy process, but this week they are divided. Unsecured creditors, including holders of $45 million of municipal bonds sold by the hospital, are trying to derail the sale; there will be little for them in proceeds if the sale goes through. Creditors favoring liquidation called expert witnesses to testify that the hospital and its assets are worth $26 million and tried to portray Doctors Community as unreliable. To help settlement talks, D.C. Mayor Anthony Williams and leaders of the D.C. Council and the D.C. Financial Control Board sacrificed the city's guarantee of recovering its $3.1 million in order to entice Doctors Community to stay in the deal. Attorneys for the hospital, Doctors Community and creditor Daiwa Bank of Japan argued that there "would be no bonanza for creditors" if the facility is liquidated. The sum recovered would be reduced by $16 million before creditors would receive anything because of laws that require two months' severance pay to employees, among other things. (ABI 12-Nov-99) HARNISCHFEGER: Notice of Auction -------------------------------- By notice published in The Wall Street Journal on November 12, 1999, the debtor, Harnischfeger Industries, Inc., et al. the US Bankruptcy court for the District of Delaware entered an order on November 8, 1999, approving proposed auction procedures to be applied in connection with sale of the assets of Beloit Corporation. A public auction will be conducted at the offices of Young, Conaway, Stargatt & Taylor LLP, Wilmington Trust Center, 1100 North Market Street, Wilmington, DE at 10:00 AM, November 23, 1999. KIWI: Viking Resources Makes Bid -------------------------------- Viking Resources International Inc. said yesterday that it intends to purchase Kiwi International Air Lines, which filed chapter 7 in August, according to a newswire report. Viking CEO Thomas Patterson said he petitioned the bankruptcy court for the acquisition of the Newark, N.J.-based carrier. Viking expects to pay about $3 to $6 million for the airline and keep its name, based on a flightless New Zealand bird. MARVEL ENTERPRISES: Revenue Increasing Over 1998, Losses Continue ----------------------------------------------------------------- Marvel Enterprises Inc. operates in the licensing, comic book publishing and toy businesses. The company owns the copyrights to over 3,500 fictional characters, including Spider-Man, X-Men, Captain America, Fantastic Four and The Incredible Hulk. The cmpany operates through the following four divisions: The Marvel Licensing division licenses the Marvel characters for use in television programs, motion pictures, destination-based ntertainment (such as theme parks), on-line media, consumer products and promotions. The Marvel Publishing division publishes comic books and paperbacks based upon the company's library of over 3,500 characters as well as certain licensed material. The Toy Biz division designs, develops, markets and distributes both innovative and traditional toys worldwide. The toy products fall into three categories: toys based on the company's characters, proprietary toys designed and developed by the company and toys based on properties licensed to the company by third parties. The Corporate division monitors the three operating divisions, manages external debt and equity holders, outlines business strategy and generally conducts the corporate governance functions of the company. Financial reports indicate that Marvel Enterprises Inc. experienced a net loss of $4,644 in the three months ended September 30, 1999, and a net loss of 16,641 in the nine months ended on that same date. Revenue for the three months period was reported at $89,882 and for the nine month period as being $226,650. For comparison, the net loss in the same three month period of 1998 was $7,223 and in the same nine month period of 1998 net loss was $4,041. Revenue in the 1998 three month period was $65,045, and in the nine month period $156,361. MEDPARTNERS PROVIDER NETWORK: Chapter 11 Plan --------------------------------------------- MedPartners Provider Network, Inc. ("MPN") holds a limited health care service plan license under the Knox-Keene Act. The DOC appointed a conservator to oversee MPN's assets on March 11, 1999. The conservator immediately filed a petition for relief under Chapter 11. Settlement discussions among MPN, MedPartners(Caremark RX, Inc., formerly known as MedPartners, Inc.) and the State resulted in an agreed term sheet that outlined the structure of a settlement whereby MPN would be restored to possession of its assets and control of its operations under the management of MedPartners. A settlement agreement empowers the examiner to oversee the settlement agreement, specifies the nature and extent of the Medpartners funding commitment, establishes procedures to pay valid claims, establishes certain specified third party beneficiary rights and contemplates a supplemental plan agreement whereby the "Supplemental Plan Agreement Parties" agree to pursue certain aspects of a plan of reorganization. The Settlement Agreement and the Supplemental Plan Agreement provide the framework for the plan. Summary of treatment of classified claims: Class 1: Secured Claims 1A: Mullikin Family Trust Secured Claims 1B: Secured Tax claims 1C: Other Secured Claims Class 2: Priority Claims Class 3: Unsecured Claims without priority 3A: MPN Provider Claims 3B: MPN Plan Preserved Claims 3C: MPN Plan Subordinated Claims 3D: Consenting MPP Subordinated Claims 3E: MedPartners Subordinated Claims 3F: Other Unsecured Claims Class 4: Interests of Hodlers of Common Stock Classes 1A, 1C, and Class 4 are not impaired. MERRY-GO-ROUND: Fidelity Takes-Up Contingency Fee Dispute --------------------------------------------------------- Fidelity Management & Research Company, on behalf of various Funds and accounts managed by it and its affiliates, picked-up last week in where Bear, Stearns & Co., Inc., appears to have left off in a fight against payment of a $74 million contingency fee to the Baltimore-based law firm of Snyder, Weiner, Weltchek, Vogelstein & Brown, which succeeded earlier this year in obtaining a $185 million settlement from Ernst & Young LLP to settle claims asserted by Deborah H. Devan, Esq., the trustee for the Merry-Go-Round Enterprises, Inc., chapter 7 cases. Bear Stearns and Snyder Weiner advised Judge Derby in the Bankruptcy Court in Baltimore that they are prepared to enter into a settlement whereby Bear Stearns will agree to withdraw its objection to Snyder Weiner's $74 million fee request if Snyder Weiner will rebate a portion of its fee. "As a consequence of this settlement," Fidelity asserts, "the interests of Fidelity and other unsecured creditors who were relying on the Bear Stearns objection are no longer represented in this case." "Fidelity and other unsecured creditors should have a voice in this matter," Bruce Zirinsky, Esq., and H. Peter Haveles, Jr., Esq., lawyers with New York-based Calwalader, Wickersham, & Taft, told Judge Derby last week, making it clear that if Bear Stearns isn't willing to press its objection to the mat, Fidelity is prepared to step into Bear Stearns' shoes for the benefit of all Merry-Go-Round creditors. Importantly, Messrs. Zirinski and Haveles note, Fidelity is prepared to continute prosecuting Bear Stearns' objection to the fee request without delaying the scheduling order that contemplates a trial on the issue before the end of the month. Fidelity takes the position that a 10% contingency fee, $18.5 million, to Snyder Weiner is a more than generous fee under any circumstances. A 10% award would be consistent with contingency fees awarded in similar cases. Moreover, based on Snyder Weiner's reporting that 12,087 attorney hours were expended to achieve the $185 million settlement with E&Y, payment of a 10% fee will compensate Ms. Devan's lawyers at an incredible $1,530 hourly billing rate. Any fee greater than 10%, Fidelity says, would simply bear no reasonable relation to the services provided and would perversely place the interests of Ms. Devan's lawyers ahead of those of Merry-Go-Round's creditors--a result wholly contrary to the dictates of the Bankruptcy Code. Fidelity reminds Judge Derby that the United States Court of Appeals for the Fourth Circuit has already taught that contingency fee agreements are not cast in stone and are not always enforceable in a bankruptcy proceeding. Fidelity points to the Fourth Circuit's finding of a "wonderful example[] of chutzpah" in the Dalkon Shield litigation where tort claimants' attorneys attempted to enforce their one-third contingency agreements in the A.H. Robbins Co. bankruptcy cases. In Robbins, the Fourth Circuit rejected the "windfall" contingency fees, reducing them to 10%. MOSSIMO: Quarter Ended September 30, 1999 Yields $1 M Net Income ---------------------------------------------------------------- Mossimo, Inc. designs, sources and markets a lifestyle collection of designer men's and women's sportswear and activewear bearing Mossimo-Registered Trademark-trademarks that project the company's image of a contemporary lifestyle. The company's apparel offerings include knit and woven shirts, outerwear, denim products, sweatshirts, tee-shirts and shorts. The company also licenses its trademarks for use in collections of eyewear, women's swimwear and bodywear, men's neckwear, men's tailored suits and dress shirts and men's hosiery. Mossimo products are characterized by quality workmanship and are targeted towards the fashion conscious consumer, generally age 35 and under. The company distributes its products to a diversified account base, including department stores, specialty retailers, and sports and activewear stores located throughout the United States, as well as one signature retail store and one outlet store in Southern California. Net sales increased to $20.3 million during the third quarter of 1999 from $11.0 million in the corresponding quarter in 1998. Net sales increased to $40.0 million during the nine months ended September 30, 1999 from $36.9 million in the corresponding period in 1998. While comparison figures show net losses in each of the period save one, the three months ended September 30, 1999 saw a net income of $1.0 million. In the same period of 1998 net loss was $3.4 million and in the nine months ended September 30, 1999 net loss was $6.0 million, while in the 1998 nine month period net loss was $11.2 million. MOUNT AIRY LODGE: Files For Bankruptcy After Death of Owner ----------------------------------------------------------- The Poconos' largest and most widely recognized resort has filed for Chapter 11 bankruptcy protection, hours after the funeral for its former principal owner, Emil Wagner. Mount Airy Lodge also missed a $300,000 payroll that was due Monday, said attorney David Neff of Hostmark Hospitality Group, which was appointed by the court to run the lodge during foreclosure. Mount Airy listed $32.4 million in secured debt and nearly $14 million in unsecured debt when it filed for Chapter 11, which allows a company to hold off its creditors and continue operating while it puts its finances in order. As the struggle over the resort's future moved into bankruptcy court, Monroe County Court Judge Peter J. O'Brien issued an order yesterday canceling a hearing he had set for today to decide whether the resort could close to save dwindling cash. The judge dismissed a Hostmark request for permission to close at least temporarily during the slow months after autumn leaves fall and before ski season is in full swing. Hostmark had argued that the only way the sprawling resort could stay open would be with an infusion of $1 million, and Neff questioned the value of the bankruptcy filing in bringing that about. "It seems to be a rather desperate act," Neff said. "What the property needs more than anything else is cash. When you file a bankruptcy, it doesn't mean cash miraculously appears." For example, the resort is facing a $90,000 electric bill due tomorrow, Neff said. It was unclear if PP&L would turn off the power if the bill was not paid. The resort's 600 employees will stay on the job at least until the hearing, Neff said. Thousands of couples have honeymooned and hundreds of well-known entertainers have performed at the landmark resort, which includes the Mount Airy Lodge and its sister resorts, Strickland's Inn and Pocono Gardens Lodge. Wagner, 77, who committed suicide last Wednesday, was known for helping build Mount Airy Lodge into one of the Poconos' most popular tourist destinations along with his cousin and co-owner Herman Martens, who died two years ago. About 300 mourners filled a Mount Pocono Lutheran church for Wagner's funeral Monday, many describing him as a visionary and marketing genius who put Mount Airy Lodge and the Poconos in the national spotlight. "Use big words, exaggerate," friend Anita dePalma recalled Wagner saying. She drew laughter when she described how Wagner insisted that reservation clerks use fancy terms like "Epicurean delights" when talking about the resort. DePalma jokingly remembered how Wagner would instruct staff members to "tell[prospective winter guests]we have snow. Tell them we have a blizzard.. . . And that was when it was 50 degrees outside." ORANGE COUNTY: Judge Rejects $48 Million Bonus Request ------------------------------------------------------ U.S. District Judge Gary Taylor this week rejected a $48 million bonus request by Hennigan, Mercer & Bennett, the law firm that represented Orange County, Calif., after its chapter 9 filing in December 1994, according to Reuters. This ruling also removed the final hurdle blocking the payout of about $865 million in settlements from numerous Wall Street firms, which will enable the country to move closer to its final rebound from the financial crisis. That money will be divided among approximately 200 government agencies and school districts that lost more than $1.6 billion in the county's investment pool when former treasurer Robert Citron's investment strategy backfired. The attorneys from the firm requested an additional $48 million after they already had received $26 million. The judge agreed the firm deserves more money but ruled that an extra $3 million was more reasonable. (ABI 12-Nov-99) PAGE AMERICA: Asset Liquidation May Not Benefit Stockholders ------------------------------------------------------------ On June 16, 1999, Page America Group Inc. filed voluntary petitions for relief under Chapter 11 of the U.S. bankruptcy Code. The company filed a prepackaged and pre-solicited Plan and Disclosure Statement that allows for the complete liquidation of the company and distribution of their remaining assets to creditors and shareholders. The Plan provides that Administrative Claims, Priority Claims and General Unsecured Claims will be paid in full in cash and adopted the same distribution provisions that had been previously approved in the Forbearance Agreement dated July 1, 1997. The company has received authorization to continue business operations as a debtor-in-possession and to pay certain claims related to the administration of the proceedings and other claims. Page America Group has no employees, leases no property and has no assets, other than cash and Metrocall securities representing the remaining net proceeds received from the sale of its assets. Cash and cash equivalents were $4.9 million at June 30, 1999 and $.5 million at December 31, 1998. During the nine months ended September 30, 1999, the company received $15.7 million from the sale of all of its Metrocall Series B Convertible Preferred Stock and $186,000 of interest income. Disbursements principally consisted of $11.1 million to retire the senior credit facility and pay any accrued interest and related expenses, $221,000 of Chapter 11 filing related expenses, and $163,000 of general and administrative expenses. In January 1999, the company received $318,000 in payment of accrued dividends on the Metrocall Series B Preferred Stock in connection with the sale of the these securities. The Plan of Liquidation contemplates that Page America will distribute any remaining assets to its common and preferred shareholders and to the holders of Subordinated Notes in accor dance with the terms and provisions of the Forbearance Agreement and as described above. Page America says the value of the assets, if any, to be available for distribution to the Page America shareholders upon liquidation cannot be ascertained at this time and will depend, among other things, on the total amount of its liabilities and the value of the Metrocall common stock to be realized by Page America. PRAEGITZER INDUSTRIES: Tender Offer From Tyco & Tyco Subsidiaries ----------------------------------------------------------------- On October 26, 1999, Sigma Circuits, Inc., a Delaware company and an indirect wholly owned subsidiary of Tyco International Ltd., a Bermuda company, and T Merger Sub (OR), Inc., an Oregon company and a direct wholly owned subsidiary of Sigma Circuits, Inc., entered into an Agreement and Plan of Merger with Praegitzer Industries, Inc. In accord with the Merger Agreement, T Merger Sub (OR), Inc. has commenced a tender offer for the common stock of Praegitzer, and, following the successful consummation of the offer, the parties will take the necessary action so that T Merger Sub (OR), Inc. will be merged with Praegitzer, and Praegitzer will become an indirect wholly owned subsidiary of Tyco. The obligations of Sigma Circuits and T Merger Sub under the Merger Agreement are guaranteed by Tyco. In connection with the Merger Agreement, Robert L. Praegitzer, the majority shareholder of the company, has entered into a Shareholder's Agreement with Sigma Circuits and T Merger Sub. Under the terms of the Shareholder's Agreement, Mr. Praegitzer has agreed, among other things, to tender his shares of common stock in the offer, or, in the case of shares that are subject to certain pledge arrangements and which cannot be tendered in the offer, to sell such shares to T Merger Sub following the successful consummation of the offer. Mr. Praegitzer has also agreed to vote his shares against any transaction that is inconsistent with the offer and the merger. The Shareholder's Agreement terminates upon termination of the Merger Agreement in accordance with its terms. By reason of the arrangements under the Merger Agreement and the Shareholder's Agreement, Sigma Circuits, Tyco International and T Merger Sub could be deemed to beneficially own the shares owned by Mr. Praegitzer. PREMIER LASER: OIS/Premier Agree To Preferred Stock Purchase ------------------------------------------------------------ OIS has entered into a Series B Preferred Stock Purchase Agreement with Premier under which OIS agreed to sell shares of OIS Series B Preferred stock at the price of $25.00 per share with each share carrying the voting power of 1,000 shares of OIS common stock. OIS becomes obligated to sell 50 shares of the Series B Preferred stock for every 50,000 shares of OIS common stock issued under OIS common stock options. Premier intends to purchase any such shares by canceling indebtedness of OIS to Premier. Previously, on October 18,1999, OIS filed a Certificate of Determination which designated the rights, preferences, privileges and restrictions of the Series B Preferred stock. On October 21, 1999, OIS, Premier and Walt Williams, Daniel Durrie and Randall Fowler (outside Directors) entered into an agreement which (i) recognized the exercise by each of them of an option to purchase 50,000 shares of OIS common stock for an aggregate total of 150,000 shares; and (ii) effected the sale by OIS to Premier of 150 shares of the Series B Preferred Stock in exchange for Premier's cancellation of certain OIS indebtedness in the amount of $3,750. PREMIER LASER: Upon Merger OIS To Become Subsidiary Of Premier -------------------------------------------------------------- On October 21, 1999, Premier Laser Systems Inc. entered into an agreement and plan of reorganization with OIS and Ophthalmic Acquisition Corporation, a California corporation and wholly-owned subsidiary of Premier. Subject to the terms and conditions of the merger agreement, Premier will be merged with and into OIS at the effective time of the merger, and OIS will become a wholly-owned subsidiary of Premier. At the effective time of the merger, each outstanding share of the common stock, $.01 par value per share, of OIS, other than shares of OIS common stock to be canceled in accordance with the merger agreement, will be converted into the right to receive 0.80 shares of Class A common stock, par value $.01 per share, of Premier. In addition, Premier will assume certain outstanding options exercisable for OIS common stock. The merger is intended to be a tax-free reorganization under the Internal Revenue Code of 1986, as amended. The merger is subject to approval by the shareholders of OIS, regulatory approvals and other customary closing conditions. PURINA MILLS: Chase Bank Objects to Houlihan, Lokey --------------------------------------------------- Chase Bank of Texas, NA as agent for certain lenders to Purina Mills, Inc. objects to the application of the debtors seeking authority to employ Houlihan, Lokey, Howard & Zukin Capital as Financial Advisors. The Bank objects to the "Transaction Fee" of approximately $3 million. The Bank states that at this time it is impossible to determine whether the fee is reasonable. Houlihan is charging a $125,000 monthly advisory fee, and the Bank states that by denying the Transaction Fee at this time, Houlihan will not be prejudiced. RINCON ISLAND: Order Approves First Amended Disclosure Statement ---------------------------------------------------------------- On October 25, 1999, the US Bankruptcy Court for the Central District of California, Northern Division entered an order approving the first amended Disclosure Statement accompanying the first amended joint plan of reorganization proposed by Rincon Island Limited Partnership, its Committee of Unsecured Creditors, and Windsor Energy US Corporation. December 13, 1999 is set at the hour of 2:00 PM as the date and time for the hearing on confirmation of the First Amended Plan, which hearing shall be held in Courtroom 201 of the US Bankruptcy Court, 1415 E. State Street, Santa Barbara, California 93101. The plan contemplates a new loan by the Bank to the Reorganized Debtors to fund some of the payments required under the plan. Reorganized Rincon will use cash on hand plus the post- confirmation loan to make the payments required to be made to creditors pursuant to the plan on the Effective Date, including the payments to be made or reserves with respect to holders of Administrative Expenses, Priority Tax Claims, Priority Non-Tax Claims, and Unsecured Claims. The Reorganized Debtors will continue in existence and will operate and conduct their business focusing primarily on the continued exploration, acquisition, development, exploitation and production of oil and natural gas in the Rincon Field. Summary of Treatment of Claims and Interests: Class 1 Allowed Rincon Priority Non-Tax Claims - No claims estimated - Unimpaired. Estimated Recovery: 100% Class 2 Allowed Rincon Bank Loan Secured Claim - Estimated Claims: $23,084,458 - Impaired - Estimated Recovery: 100% Class 3 Allowed Rincon Oil and Gas Lien Claims and Allowed Rincon M&M Lien Claims - Estimated Claims: $1,988,800 - Impaired Estimated Recovery:100% Class 4 Allowed Rincon Berry Petroleum Secured Claim - Estimated Claim: $400,000 - Impaired. Estimated Recovery: 100% Class 5 Allowed Rincon General Unsecured Claims - Estimated Claims: $2.5m - Impaired - Estimated Recovery: 46% Class 6 Allowed Rincon Equity Interests - Unimpaired - Holders will retain all of their prepetition interests in Rincon Class 7 Allowed WEUS Priority Non-Tax Claims -Unimpaired Estimated Claims: None Class 8 Allowed WEUS Bank Secured Claims - Estimated Allowed Claim: $100,000 Impaired. Estimated Recovery: 100% Class 9 Allowed WEUS GP Based General Unsecured Claims - Estimated Claims: $2.5m - Impaired. Estimated Recovery: 1% Class 10 WEUS Non-GP Based General Unsecured Claims - Estimated Claims: $23.3m Estimated Recovery: 50% Class 11 WEUS Subordinated Debenture Unsecured Claims - Impaired - Estimated Claims: $3.09m - Estimated Reocvry:50% Class 12 Allowed WEUS Equity Interests Unimpaired additional distribution. RITE AID: Explores Sale of West Coast Stores to Reduce Debt Load ---------------------------------------------------------------- Rite Aid Corp., Camp Hill, Pa., is considering the sale of some or most of its 1,100 West Coast stores to help pay down the drugstore chain's debt, The Wall Street Journal reported. This would reverse the company's recent aggressive acquisition strategy and shift the company's focus from being a national retailer. For several months Rite Aid has been seeking buyers for 250 to 350 of its West coast stores; the asking price averages $2.5 million per store. In September, Longs Drug Stores Corp., Walnut Creek, Calif., paid $186 million for 38 Rite Aid stores. Rite Aid also has reached an agreement to sell more than 40 of its larger stores in Oregon, Washington and Idaho to Bi- Mart Corp. To further reduce debt, Rite Aid is also seeking a buyer for its PCS Health Systems unit, a provider of prescription-based benefits. Rite Aid prevented a debt crisis in late October by renegotiating about $1.6 billion in loans with its banks just prior to a repayment deadlines. The banks have extended the debt by a year, and their interest rate will increase if Rite Aid does not achieve a certain level of asset sales by early 2000. (ABI 12-Nov-99) SPECTRUM INFORMATION: Annual Meeting Has Purposeful Agenda --------------------------------------------------------- Notice has been given stockholders of Spectrum Information Technologies I, (doing business as Siti-Sites.com), that the 1999 annual meeting of stockholders will be held at 10:00 a.m. on December 9, 1999, at the company's offices located at 594 Broadway, Suite 1001, New York, New York. Stockholders will meet for the following purposes: 1. To elect one Class I Director to serve for the ensuing one year and until his successor is duly elected and qualified, (b) to elect one Class II Director to serve for the ensuing two years and until his successor is duly elected and qualified, and (b) to elect one Class III Director to serve for the ensuing three years and until his successor is duly elected and qualified. 2. To approve the company's Amended and Restated Certificate of Incorporation to, among other things, (a) change the name of the company to "Siti-Sites.com, Inc.", (b) increase the number of authorized shares of common stock from 10,000,000 to 35,000,000, and the number of authorized shares of Preferred stock from 2,000,000 to 5,000,000, (c) delete the authorization for and all references to Class A Stock, which was automatically converted to common stock on March 31, 1999,(d) delete certain limitations on transfers of common stock which were originally designed to preserve net operating loss carry forwards of the company, but are now considered to be irrelevant, and have been lost as a result of the change of control transaction in December, 1998, and (e) further indemnify the company's directors, officers and employees against costs and expenses relating to the performance of their duties. 3. To approve a plan of financing to raise additional funds through a private placement with Lawrence M. Powers, the Chairman of the Board, Chief Executive Officer and a major stockholder of the company. 4. To ratify the company's 1999 Stock Option Plan. 5. To ratify the appointment of Edward Isaacs & Company LLP as the company's independent public accountant for the company's fiscal year ending March 31, 2000. The Board of Directors has fixed the close of business on October 25, 1999, as the record date for the determination of stockholders entitled to receive notice of and to vote at the annual meeting. SUN TV: Seeks Confirmation Hearing Date for Liquidating Plan ------------------------------------------------------------ Sun TV and Appliances, Inc. seeks to schedule a hearing on confirmation of its liquidation plan. Sun TV requests that the court fix December 22, 1999 at 9:30 AM as the date for the commencement of the hearing on confirmation of the plan. TELEGEN: Signs Investment Banking Agreement ------------------------------------------- Telegen Corporation (OTC BB:TLGNQ) today announced that it has completed negotiations and executed an Investment Banking agreement with WMS Financial Planners, Inc., and Pacific West Securities, Inc., which contemplates both a debt offering and a stock offering totaling up to$14.3 million. The agreement is subject to approval by the U.S. Bankruptcy Court at a hearing scheduled for Nov. 30, 1999. Pending Court approval, Telegen plans to begin the debt and stock offerings in December of this year. Proceeds of the debt offering of up to $500,000 will be available to Telegen immediately. Proceeds of the stock offering of up to $13.8 million will be used to fund a Plan of Reorganization which Telegen intends to file by the end of this year. Telegen expects to complete reorganization in the first half of next year. "This agreement is the culmination of many months of hard work by a very dedicated staff of professionals and represents a major milestone in the commercialization of our HGED flat panel display technology," said Telegen Corporation President and CEO Jessica L. Stevens. Telegen Corporation is located in San Mateo, California, and is developing a proprietary flat panel display technology known as HGED as well as hardware solutions for internet delivered MP3 music through its subsidiary Telegen Communications Corporation. The Company's stock is traded on the electronic bulletin board under the symbol TLGNQ. THE PHARMACY FUND: Hearing To Consider Disclosure Statement ----------------------------------------------------------- A hearing will be held on November 30, 1999 before the Honorable Tina L. Brozman, US Bankruptcy Court, Room 723, One Bowling Green, New York, NY 10004 on November 30, 1999 at 2:00PM to consider the adequacy of information and approving the Dislcosure Statement of the debtors, The Pharmacy Fund, Inc. and Pharmacy Fund Receivables, Inc. The plan is a plan of liquidation for each debtor. In the Pharmacy Fund Receivables case, where most of the Pharmacies assert claims, after payment of allowed administrative expense claims, allowed priority tax claims and allowed priority claims, all claims of the settling pharmacies pursuant to the Model Settlement Agreement shall be paid in full. The funds for these payments will be held by PFR in the Settling Pharmacy Reserve and will contain the balance of the Segregated Account. Holders of Allowed General Unsecured Claims against Pharmacy Fund Receivables, including those claims of non-settling pharmacies, terminated pharmacies and the allowed claim of Prudential Securities Credit Corporation shall share pari passu in the distribution of the remaining funds in the Pharmacy Fund Receivables estate. It is anticipated that holders of Class 3 allowed claims will receive an initital distribtuion of approximately 47% and an additional distribution. Prudential Securities shall have an allowed general unsecured claim in the amount of $72,109,849. Other general unsecured claims against Pharmacy Fund Receivables shall receive a distribution of 47.31%. Equity interests in Pharamcy Fund Receivables shall receive no distribution. In the Pharmacy Fund case, Prudential Securities shall have an allowed general unsecured claim against PFI in the amount of $27,124,000. It is estimated that allowed general unsecured claims agianst Pharmacy Fund should receive a distribution of approximately 5%. VENCOR: Announces Third Quarter Results --------------------------------------- Vencor, Inc. today announced its operating results for the third quarter and nine months ended September 30, 1999. Revenues for the quarter totaled $681.9 million compared with$718.1 million in the year-earlier period. Excluding the effects of certain unusual transactions, the Company reported a loss from operations of $37.0 million or $ 0.53 per share compared with a loss of$4.1 million or $0.06 per share in the third quarter of 1998. Operating results for both periods included certain unusual transactions. The operating loss reported in the third quarter of 1999 includes $5.4 million or $0.08 per share of professional fees incurred in connection with the Company's restructuring activities. Unusual transactions in the third quarter of 1998 increased net operating results by $41.7 million or $0.60 per diluted share. These transactions included a gain of $98.5 million resulting from the Company's sale of its investment in Atria Communities, Inc. and charges of $56.8 million related to the cancellation of construction projects, losses related to the planned closure of two hospitals, expenses for uncollectible accounts receivable from previously sold or closed nursing center, home health and hospice operations and the write-down of the Company's investment in Behavioral Healthcare Corporation ("BHC") to its net realizable value. For the nine months ended September 30, 1999, revenues were $2.1 billion compared to $2.3 billion in the prior year. Excluding the effects of certain unusual transactions, losses from operations totaled $64.5 million or $0.93 per share in the current period compared to income from operations of $17.7 million or $0.25 per share in the same period a year ago. Unusual transaction costs totaled $33.1 million or $0.47 per share for the nine months ended September 30, 1999, including $27.7 million recorded in the first and second quarters of 1999 for losses associated with the write-down of the Company's remaining investment in BHC, professional fees incurred in connection with the Company's restructuring activities and the cancellation of a nursing center software development project. In addition, a change in accounting for deferred start-up costs recorded in the first quarter of 1999 reduced earnings for the nine month period by $8.9 million or $0.13 per share. Operating results for the nine months ended September 30, 1998 included income of $15.3 million or $0.23 per share related to unusual transactions, including $26.4 million of charges recorded in the first and second quarters of 1998 for costs to complete the spin- off transaction with Ventas, Inc. (NYSE:VTR), losses related to the disposal of certain non-strategic businesses, and the write- off of capitalized amounts related to a cancelled construction project. Results for the nine months ended September 30, 1998 also included an extraordinary loss of $77.9 million or $1.15 per share incurred in connection with the refinancing of debt in the spin-off transaction with Ventas. During the nine months ended September 30, 1999, revenues in each of the Company's three operating divisions were affected adversely by the provisions of the Balanced Budget Act of 1997 (the "Budget Act") and other reductions in Medicare reimbursement. Under the new prospective payment system ("PPS"), which became effective July 1, 1998, Medicare revenues in the nursing center division were substantially less than those earned under the former cost-based reimbursement system. The Budget Act also reduced Medicare revenues in the Company's hospitals related to certain incentive payments, allowable bad debts and capital costs, and payments for services provided to patients transferred from general acute care hospitals. Medicare payments to the Company's hospitals related to certain respiratory therapy and pharmacy costs also have been reduced in 1999. The demand for the Company's Vencare services, particularly respiratory and rehabilitation therapies, has declined significantly as Vencare nursing center customers have attempted to reduce operating costs in response to PPS. In addition to reductions in Medicare reimbursement, operating results for the third quarter of 1999 also were affected adversely by$7 million of additional provisions for doubtful accounts in the nursing center and Vencare divisions and a $3 million charge related to a nursing center professional liability settlement. The provision for income taxes for the third quarter and nine months ended September 30, 1999 included charges of $15.0 million and$26.4 million, respectively, to establish a deferred tax valuation allowance. There are no deferred tax assets included in the Company's condensed consolidated balance sheet at September 30, 1999. The Company filed voluntary petitions for protection under Chapter 11 of the United States Bankruptcy Code on September 13, 1999. The Company is currently operating its business as a debtor-in-possession subject to the jurisdiction of the United States Bankruptcy Court in Delaware. Accordingly, the condensed consolidated financial statements of the Company have been prepared in accordance with the American Institute of Certified Public Accountants Statement of Position 90-7, "Financial Reporting by Entities in Reorganization Under the Bankruptcy Code" and generally accepted accounting principles applicable to a going concern, which assumes that assets will be realized and liabilities will be discharged in the normal course of business. As previously announced, the Company continues to develop a plan of reorganization with its senior bank lenders, holders of its subordinated debt, Ventas and the Federal government to obtain a sustainable capital structure for the Company and to enhance the financial viability of the reorganized Company. Vencor is a long- term healthcare provider operating nursing centers, hospitals and contract ancillary services in 46 states. WINDSOR ENERGY: Order Approves First Amended Disclosure Statement ----------------------------------------------------------------- On October 25, 1999, the US Bankruptcy Court for the Central District of California, Northern Division entered an order approving the first amended Disclosure Statement accompanying the first amended joint plan of reorganization proposed by Rincon Island Limited Partnership, its Committee of Unsecured Creditors, and Windsor Energy US Corporation. December 13, 1999 is set at the hour of 2:00 PM as the date and time for the hearing on confirmation of the First Amended Plan, which hearing shall be held in Courtroom 201 of the US Bankruptcy Court, 1415 E. State Street, Santa Barbara, California 93101. The plan contemplates a new loan by the Bank to the Reorganized Debtors to fund some of the payments required under the plan. Reorganized Rincon will use cash on hand plus the post- confirmation loan to make the payments required to be made to creditors pursuant to the plan on the Effective Date, including the payments to be made or reserves with respect to holders of Administrative Expenses, Priority Tax Claims, Priority Non-Tax Claims, and Unsecured Claims. The Reorganized Debtors will continue in existence and will operate and conduct their business focusing primarily on the continued exploration, acquisition, development, exploitation and production of oil and natural gas in the Rincon Field. Summary of Treatment of Claims and Interests: Class 1 Allowed Rincon Priority Non-Tax Claims - No claims estimated - Unimpaired. Estimated Recovery: 100% Class 2 Allowed Rincon Bank Loan Secured Claim - Estimated Claims: $23,084,458 - Impaired - Estimated Recovery: 100% Class 3 Allowed Rincon Oil and Gas Lien Claims and Allowed Rincon M&M Lien Claims - Estimated Claims: $1,988,800 - Impaired Estimated Recovery:100% Class 4 Allowed Rincon Berry Petroleum Secured Claim - Estimated Claim: $400,000 - Impaired. Estimated Recovery: 100% Class 5 Allowed Rincon General Unsecured Claims - Estimated Claims: $2.5m - Impaired - Estimated Recovery: 46% Class 6 Allowed Rincon Equity Interests - Unimpaired - Holders will retain all of their prepetition interests in Rincon Class 7 Allowed WEUS Priority Non-Tax Claims -Unimpaired Estimated Claims: None Class 8 Allowed WEUS Bank Secured Claims - Estimated Allowed Claim: $100,000 Impaired. Estimated Recovery: 100% Class 9 Allowed WEUS GP Based General Unsecured Claims - Estimated Claims: $2.5m - Impaired. Estimated Recovery: 1% Class 10 WEUS Non-GP Based General Unsecured Claims - Estimated Claims: $23.3m Estimated Recovery: 50% Class 11 WEUS Subordinated Debenture Unsecured Claims - Impaired - Estimated Claims: $3.09m - Estimated Reocvry:50% Class 12 Allowed WEUS Equity Interests Unimpaired additional distribution. WIRELESS ONE: Entry of Order Confirming Plan -------------------------------------------- In a legal notice published in The Wall Street Journal on Friday, November 12, 1999, the debtor, Wireless One, Inc. reports that the US Bankruptcy Court for the District of Delaware entered an order on October 28, 1999 confirming the plan of reorganization of the debtor. The administrative claims bar date is February 7, 2000. ********* 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, Yvonne L. Metzler, Editors. 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