/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/991117.MBX T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, November 17, 1999, Vol. 3, No. 223 Headlines BIRMINGHAM STEEL: Letter To Stockholders BREED TECHNOLOGIES: Court Approves Tatum CFO Partners BREED TECHNOLOGIES: Court Approves Employee Retention Program CONSUMER PORTFOLIO: Reports 1999 Third Quarter Results COSTILLA ENERGY: Order Approves Employment of Counsel COSTILLA ENERGY: Reports Third Quarter Results CRIIMI MAE: Reports Third Quarter 1999 Results DEVLIEG-BULLARD: Order Grants Extension of Exclusivity DEVLIEG-BULLARD: Motion For Order Setting Bar Date FORMAN PETROLEUM: Hearing on Approval of Disclosure Statement GENEVA STEEL: Seeks Order Extending Exclusivity HARNISCHFEGER: Seeking Approval of Beloit Auction Procedures HEALTHSPHERE OF AMERICA: Seeks Extension To Exclusivity IMAGYN MEDICAL: Entry of Confirmation Order and Effective Date IMAGYN MEDICAL: Reports Monthly Losses Exceeding Revenues JUST FOR FEET: Wins Interim Approval of $200 Million DIP Loan PACE HEALTH: 1998 Asset Sale Supplies Income In Recent Qtr. PHAR MOR: 13 Weeks Ended October 2, 1999 Yields $4,191 Net Loss PLANET HOLLYWOOD: Meeting of Creditors PLANET HOLLYWOOD: Hearing To Consider Disclosure Statement PLANET HOLLYWOOD: Bar Date Order POWER DESIGNS: Shows Net Sales Increase PRIMARY HEALTH: Seeks Order Extending Exclusivity PSI INDUSTRIES: Counsel for Committee Approved RITE AID: KPMG Resigns as Auditor SCORE BOARD: Order Confirming Chapter 11 Plan SELECT SWITCH: Hearing Regarding Disclosure Statement SMITH CORONA: Quarterly Sales Decrease But Net Loss Is Reduced STARTER CORP: Committee Objects To Extension of Exclusivity SUN HEALTHCARE: Government Seeks Stay of DIP Financing TAPISTRON INTERNATIONAL: Fiscal Year Financials Offer Comparison US PETSEC: May File for Bankruptcy Protection VIDIKRON TECHNOLOGIES: Files Chapter 7 WESTMORELAND COAL: Reports Third Quarter Results WILSHIRE FINANCIAL: Reports Third Quarter Results of Operations WISER OIL: 5.33% Of Stock Held By Paul Glenn & Revocable Trust WORLDPORT COMMUNICATIONS: Involuntary Petition Filed By Employees ********* BIRMINGHAM STEEL: Letter To Stockholders ---------------------------------------- Birmingham Steel Corporation (NYSE: BIR) said that it is sending the following letter to its stockholders: November 16, 1999 Dear Birmingham Steel Stockholder: The dissident United Group, in what we see as an increasingly desperate attempt to gain votes as the December 2 Annual Meeting of Stockholders approaches, has pursued a campaign of misinformation to try to discredit your Company's management and Board of Directors. This is "attack campaigning" at its worst -- and none of us should let them get away with it. In order to set the record straight, we would like to reintroduce you to Birmingham Steel's strong and experienced senior management team and its exceptionally dedicated and accomplished Board of Directors. (The Following bios are Summarized From Letter) ROBERT A. GARVEY, CHAIRMAN AND CHIEF EXECUTIVE OFFICER Bob Garvey is a nationally recognized steel executive, with more than forty years of industry experience. Before joining Birmingham Steel in 1996, he held various quality-assurance and operating positions in his 22 years at Laclede Steel, including Chief Metallurgist and Melt Shop Superintendent; was President of North Star Steel, a subsidiary of Cargill, Inc., for 12 years; and also served as President of Cargill's worldwide steel operations. In fact, when former Birmingham Steel CEO James Todd -- now a leader of the dissident United Group -- finally recognized that he and his senior management team were not capable of addressing the many problems at Birmingham Steel that arose under Todd's stewardship, Todd actively recruited Bob Garvey to come in and fix the problems. This is precisely what Bob has been doing for the past few years. We ask you to compare Bob Garvey's background, experience and record of achievement to that of John Correnti -- the United Group's pre-picked CEO. And when the United Group tries to tell you that Correnti is the man for the job, ask them why he was forced out as CEO of Nucor, another steel company, earlier this year. BRIAN F. HILL -- CHIEF OPERATING OFFICER Brian Hill joined Birmingham Steel in June 1999 after serving for 31 years as a senior executive at Cargill, including 15 years of senior-level steel and steel-related experience with both North Star and Cargill. KEVIN E. WALSH -- CHIEF FINANCIAL OFFICER Kevin Walsh joined Birmingham Steel in July 1998. He was with Johnson & Johnson for 20 years, holding both domestic and international positions. He also has had extensive financial and operational experience with other major multinational corporations. In recent months, Kevin was instrumental in working with the Company's lending institutions in successfully restructuring our debt. BIRMINGHAM STEEL'S BOARD OF DIRECTORS Your Board of Directors is composed of nine extraordinarily capable business leaders with proven records of performance. Eight of our Board members are independent, unaffiliated directors, and six of the eight have headed major steel or metal- related companies, including ASARCO, Eaton Corporation, LTV/Republic Steel, Precision Grinding, J. H. Roberts Industries and Union Carbide. Our Board also includes the former Chairman and CEO of Texaco, one of the world's leading explorers, producers and marketers of oil and natural gas. This is a Board of Directors where every single member is a seasoned business executive, with the background and expertise to guide Birmingham Steel successfully through its strategic restructuring. Highlights of their careers and accomplishments are enclosed as an attachment to this letter. In marked contrast, the most notable thing we see about the United Group's slate of nominees is a nearly complete lack of steel industry experience. Here are some important facts about the dissident nominees: -- Seven of the nine nominees appear to have no steel industry experience. -- Three of their nominees -- John Correnti, Donna Alvarado and Robert Gerrity -- serve together on the Board of Directors of Harnischfeger Industries. Harnischfeger recently filed for bankruptcy and in a current Fortune magazine article is labeled as "the worst stock in the S&P 500."(a) (a) Fortune, November 22, 1999, article by Andy Serwer. Permission to cite this article was neither sought nor obtained. -- In June 1999, Correnti was forced to resign as CEO of Nucor, another steel company, after Nucor's Board determined he was not right for the job. -- James Todd's tenure as Birmingham Steel's CEO was marked by bad decisions, bad execution and bad performance. While Bob Garvey and his senior management team have worked tirelessly to remedy the problems created during the Todd years, Todd and his dissident group have worked tirelessly to shift the blame to Bob Garvey. The dissident nominees, in our view, clearly lack the qualifications, background and experience to build stockholder value at Birmingham Steel. These shortcomings are evidenced by their misguided platform to continue to spend millions of dollars in the hope that they somehow can "fix" the SBQ business. We urge stockholders to support your Company's strategic restructuring, with its focus on our (more) core businesses and the timely sale of the SBQ operations--a course of action that we believe is essential to preserve and enhance the value of your shares. The future of your investment in Birmingham Steel is far too important to put in the hands of Correnti, who is looking for a new job, and of Todd, who wants to return to a leadership position at your Company no matter what the cost may be to you. We urge you to reject the Todd-Correnti dissident group and its nominees by signing, dating and mailing the enclosed WHITE proxy card today. Do not sign any blue proxy card sent to you by the dissident group. We thank you for your continued confidence and support. Very truly yours, BIRMINGHAM STEEL CORPORATION The Company has recently become aware of a discrepancy in the number of shares reported to be outstanding as of October 7, 1999, the consent record date, and October 19th, 1999, the annual meeting record date. The correct number of shares outstanding as of both record dates was 29,730,351. The Board of Directors of Birmingham Steel is composed of nine individuals -- eight independent directors plus Chairman/CEO Bob Garvey -- all of whom are committed to a single, over-riding objective: building the value of Birmingham Steel for you. The following are summaries of the individuals: William J. Cabaniss, Jr. is Chairman and CEO of Precision Grinding, Inc, which he co-founded in 1971 and built into one of the largest steel plate grinding and machining companies in the Southeast. C. Stephen Clegg is Chairman and CEO of Diamond Home Services, a contractor of installed home improvement products, and of Midwest Spring Manufacturing Company, a manufacturer of specialty springs, wireforms and metal stamping products. Alfred C. DeCrane, Jr. served as Chairman of Texaco Inc., an explorer, producer and marketer of oil and natural gas, from 1987 to 1996 and as CEO from 1993 to 1996. E. Mandell de Windt, who was your Company's Chairman from 1985 to 1991 and has chaired the Board's Executive Committee since 1991, served as Chairman and Chief Executive Officer of Eaton Corporation, a diversified manufacturing concern, from 1969 to 1986. E. Bradley Jones served as Chairman and CEO of LTV Steel Company from June 1984 to December 1984, and as Chairman and CEO of Republic Steel Corporation (which merged with The LTV Corporation in 1984) from 1982 to 1984. Robert D. Kennedy served as Chairman and Chief Executive Officer of Union Carbide Corporation, one of the world's largest manufacturers of chemicals and plastics, from 1986 to 1995. Richard de J. Osborne was Chairman and Chief Executive Officer of ASARCO Incorporated, a leading producer of nonferrous metals, from 1995 to 1998. John H. Roberts founded and headed J. H. Roberts Industries, a leading manufacturer and distributor of carbon steel tubing and chrome-plated steel bars, from 1982 until 1998. Birmingham Steel operates in the mini-mill sector of the steel industry and conducts operations at facilities located across the United States. The common stock of Birmingham Steel is traded on the New York Stock Exchange under the symbol "BIR." BREED TECHNOLOGIES: Court Approves Tatum CFO Partners ------------------------------------------------------ By court order entered October 28, 1999, the debtors, BREED Technologies, Inc., are authorized to retain Tatum CFO Partners, LLP as financial management advisors. BREED TECHNOLOGIES: Court Approves Employee Retention Program ------------------------------------------------------------- By court order entered on October 28, 1999, BREED Technologies Inc. is authorized to implement an employee retention program except that 50% of each eligible employee's retention bonus shall be payable on September 15, 2000 rather than September 30, 2000. CONSUMER PORTFOLIO: Reports 1999 Third Quarter Results ------------------------------------------------------ Consumer Portfolio Services, Inc. (Nasdaq: CPSS) announced financial results for its third quarter, ended September 30, 1999. For the third quarter, total revenues decreased from a positive$34.6 million for the three months ended September 30, 1998, to a negative $9.2 million. The Company's net loss for the period was $16.6 million, or $0.82 per share, on 20.1 million diluted shares outstanding, compared to net earnings of $6.2 million, or $0.38 per share, on 16.9 million diluted shares outstanding for the same period in the prior year. For the nine months ended September 30, 1999, total revenues decreased 71.9% to $25.0 million, compared with $89.1 million for the same period in the prior year. Net earnings decreased from $17.8 million, or $1.08 per share, on 16.7 million diluted shares outstanding for the nine months ended September 30, 1998, to a net loss of $25.6 million, or $1.41 per share, on 18.2 million diluted shares outstanding for the nine months ended September 30, 1999. Purchases of contracts from automobile dealers decreased 70.4% in the third quarter to $89.6 million, compared to $303.0 million for the same period in 1998. Contracts sold during the third quarter decreased 65.1% to $83.8 million, all of which was on a servicing released basis, compared to $240.3 million, all of which was on a servicing retained basis, for the same period in the prior year. The aggregate outstanding balance of contracts serviced by the Company at September 30, 1999, decreased by 19.4% to $948.0 million, compared to $1,175.7 million at September 30, 1998. Balances of accounts past due over 30 days represented 5.7% of the servicing portfolio at September 30, 1999, compared with 4.7% at September 30, 1998. The annualized net charge off rate for the three month period ended September 30, 1999, was 9.8%, compared to 6.5% for the three month period ended September 30, 1998. The Company's non-discounted allowance for credit losses equaled $95.5 million, or 10.1% of the contracts sold that it serviced as of September 30, 1999. The on-balance sheet allowance for credit losses was $2.2 million, or 32.3% of contracts held for sale at September 30, 1999. As of September 30, 1999, the inventory of repossessed vehicles was 3.1% of the servicing portfolio, compared to 1.9% at September 30, 1998. "This year has been a challenging one," said Charles E. Bradley, Jr., President and Chief Executive Officer. "Our operating plan up to this point has been to maintain the Company's infrastructure and solve our liquidity problems. As we previously announced, we have made tremendous progress towards solving our liquidity needs with the signing of various agreements allowing for releases of cash from our securitized portfolio. With continued monthly releases of cash we will be positioned to rebuild the Company to be once again an industry leader. This year did give us the opportunity to reengineer our operating procedures to make us more efficient in all areas of our business," continued Bradley. "As the most difficult year in the Company's history comes to a close, we look forward to a fresh start in the new millennium and a successful 2000." COSTILLA ENERGY: Order Approves Employment of Counsel ----------------------------------------------------- The US Bankruptcy Court for the Western District of Texas, Midland Division, entered an order approving the employment and retention of Weil, Gotshal & Manges LLP as counsel for the Committee of Unsecured Creditors of Costilla Energy, Inc. COSTILLA ENERGY: Reports Third Quarter Results ---------------------------------------------- Costilla Energy, Inc. (OTC Bulletin Board: COSE) today reported cash flow(1) of $2.1 million, or $0.15 per share, and a net loss applicable to common equity of $5.9 million, or $0.42 per share, for the third quarter ended September 30, 1999. The net loss included a non-cash charge of $943,000 as a result of the impairment of an oil and gas property(2) due to the expiration of leasehold acreage located in east Texas to which proved undeveloped reserves had been attributed. These results compare with cash flow of $2.6 million, or $0.26 per share, and a net loss applicable to common equity of $8.2 million, or $0.83 per share, for the quarter ended September 30, 1998. Adjusted EBITDA(3) for the third quarter of 1999 was $6.0 million compared with $7.2 million for the quarter ended September 30, 1998. Costilla produced 4.3 Billion cubic feet of natural gas and 124,000 barrels of crude oil and condensate, or a total of about 5.0 Billion cubic feet of natural gas equivalent (Bcfe) during the third quarter of 1999, an average rate of approximately 54.6 Million cubic feet of natural gas equivalent (Mmcfe) per day. This compares with 7.6 Bcfe, or approximately 82.3 Mmcfe per day produced in the third quarter of 1998. The reduction in production is attributable primarily to various sales of producing properties during the first half of 1999, and the Company's inability to continue its drilling efforts due to financial constraints. During the third quarter of 1999, Costilla sold natural gas at an average net price of $2.13 per thousand cubic feet (Mcf), after a hedging cost of $0.17 per Mcf, compared with $2.06 per Mcf during the third quarter of 1998, which included hedging revenue of $0.22 per Mcf. The Company sold oil at an average net price of $14.87 per barrel, after a hedging cost of $4.75 per barrel during the third quarter of 1999, compared with $14.96 per barrel, including $4.58 per barrel from hedging, during the quarter ended September 30, 1998. Oil and gas revenues for the third quarter ended September 30, 1999, totaled $11.0 million, after hedging costs of $1.3 million, compared with $16.8 million for the same quarter of 1998, which included $3.2 million in revenues from hedging. Costilla's cost management efforts resulted in continued reductions in lease operating expenses (LOE) during the quarter ended September 30, 1999. Third quarter LOE, excluding production taxes, was $0.57 per Mcfe, down from $0.63 per Mcfe for the second quarter of 1999, and $0.80 per Mcfe for the quarter ended September 30, 1998. General and administrative expenses (G&A) were also significantly reduced for the three months ended September 30, 1999, to $1.9 million, which included $ 682,000 related to reorganization costs, from $2.8 million in the third quarter of 1998. Per Mcfe, G&A for the third quarter of 1999 was $0.23, excluding reorganization costs, compared with $0.37 per Mcfe for quarter ended September 31, 1998. The Company reported that the counter-party to its commodity price hedging contracts elected an early termination of the contracts and asserted claimed losses of approximately $15.9 million related to the open positions, and $3.6 million for unpaid invoices. The amount due for the hedging obligations and the secured nature, if any, of those obligations is subject to review by the Company. The Company continues to conduct operations in ordinary course under Chapter 11 of the United States Bankruptcy Code. Management is actively engaged in negotiations with certain potential purchasers, equity investors or merger partners and intends to submit a plan of reorganization for consideration by the Bankruptcy Court as soon as practicable. The consummation of any plan of reorganization will require approval of the Bankruptcy Court. Costilla Energy, Inc. is an independent oil and gas company with operations primarily in the Gulf Coast region of South Texas and the Permian Basin of West Texas and Southeastern New Mexico. (1) Cash flow is the net loss for the period, plus deferred taxes, depreciation, depletion and amortization, impairment of oil and gas properties, exploration and abandonments, other non- cash items, and extraordinary items. (2) In accordance with Statement of Financial Accounting Standards No. 121, Accounting for the Impairment of Long-Lived Assets and Assets to be Disposed Of, an impairment loss is indicated if the sum of the expected undiscounted future cash flows, on a depletable basis, is less than the carrying amount of oil and gas assets. The impairment loss is the amount by which the carrying amount of the asset exceeds the fair value of the asset, based upon discounted future net cash flows. (3) Adjusted EBITDA is earnings before income taxes, interest, depreciation, depletion and amortization, impairment of oil and gas properties, exploration and abandonments, other non-cash items and extraordinary items CRIIMI MAE: Reports Third Quarter 1999 Results ---------------------------------------------- CRIIMI MAE Inc. (NYSE: CMM), the commercial mortgage company that filed a voluntary petition to reorganize under Chapter 11 of the U.S. Bankruptcy Code on October 5, 1998, today reported results for the three and nine months ended September 30, 1999. Under generally accepted accounting principles (GAAP), net income available to common shareholders for the three months ended September 30, 1999 was $8.1 million. This compares to a net loss for last year's third quarter of approximately $8.7 million. On a per share basis, the third quarter's net income was 14 cents per diluted share and 15 cents per basic share. This compares to last year's net loss for the third quarter of 18 cents per diluted share and 18 cents per basic share. On a tax basis, CRIIMI MAE had a loss for the third quarter of approximately $17.8 million, or 33 cents per share. For last year's third quarter, tax basis income available to common shareholders was approximately $19.9 million, or 41 cents per share. For the first nine months of 1999, tax basis income was approximately $13.7 million, or 26 cents per share, compared to approximately $ 57.3 million, or $1.22 per share, for the first nine months of 1998. The sale of unsecuritized mortgage loans in one of the Company's warehouse facilities in the third quarter of 1999 resulted in cumulative losses of approximately $36.3 million under both GAAP and tax accounting. Under GAAP, $ 35.2 million of these losses were recognized in prior quarters, and $1.1 million in losses were recognized in the third quarter of 1999. Under tax basis accounting, the entire loss of $36.3 million was recognized in the third quarter of 1999, when the actual loan sales took place. CRIIMI MAE's shareholders' equity decreased to approximately $259 million ($ 3.86 per diluted share) at quarter end, from approximately $281 million ($4.24 per diluted share) at June 30, 1999. The decrease in shareholders' equity during the quarter primarily resulted from an aggregate $30.5 million decrease in the fair value of the Company's portfolio of commercial mortgage- backed securities (CMBS) and insured mortgage securities. The Company's net interest margin decreased by approximately $1.2 million under GAAP and approximately $370,000 on a tax basis for the third quarter of 1999 compared to the third quarter of 1998. The decreases in net interest margin were primarily due to an increase in interest expense related to certain financing facilities that were outstanding for only a portion of last year's third quarter, versus the entire third quarter of 1999. Other items that contributed to the changes in earnings during these periods are identified in the tables that follow. The date currently set by the Bankruptcy Court for CRIIMI MAE and its two affiliates to file a proposed disclosure statement with respect to their Joint Plan of Reorganization is December 6, 1999. Judge Duncan W. Keir has also scheduled a hearing for that date on a pending motion to approve the bidding protection provisions in the Stock Purchase Agreement ("Agreement") entered into on September 9, 1999 by CRIIMI MAE and an affiliate of Apollo Real Estate Advisors IV, L.P. ("Apollo"). CRIIMI MAE, Apollo and the Official Committee of Unsecured Creditors of CRIIMI MAE and the Official Committee of Equity Securities Holders (collectively, the "Committees") have been actively engaged in discussions to fashion an amended plan of reorganization that can be supported by these parties. Before filing for reorganization, CRIIMI MAE had been actively involved in acquiring, originating, securitizing and servicing multifamily and commercial mortgages and mortgage related assets throughout the United States. Since filing for Chapter 11 protection, CRIIMI MAE has suspended its subordinated CMBS acquisition, origination and securitization programs. The Company, however, continues to hold a substantial portfolio of subordinated CMBS and, through its servicing affiliate, acts as a servicer for its own as well as third party securitizations. DEVLIEG-BULLARD: Order Grants Extension of Exclusivity ------------------------------------------------------ By order of the court, the debtor, Devlieg-Bullard, Inc. has the exclusive right up to and including January 14, 2000 to file a plan of reorganization. The debtor shall have, up to and including March 14, 2000 the exclsuive right to obtain acceptance of its plan of reorganization. DEVLIEG-BULLARD: Motion For Order Setting Bar Date -------------------------------------------------- The debtors, Devlieg-BUllard, Inc. seek an order establishing January 15, 2000 as the Bar Date for filing proofs of claim against the debtor. The debtor identifies over 5,000 creditors holding $78,283,448 in claims against the debtor. FORMAN PETROLEUM: Hearing on Approval of Disclosure Statement ------------------------------------------------------------- The hearing to consider approval of the Disclosure statement for the first amended joint plan of reorganization filed by Forman Petroleum Corporation will be held before Jerry A. Brown, Bankruptcy Judge, Courtroom 705, Hale Boggs Federal Building 501 Magazine Street, New Orleans, Louisiana on November 10, 1999 at 9:00 AM. GENEVA STEEL: Seeks Order Extending Exclusivity ----------------------------------------------- Geneva Steel Company, debtor, with the consent of the Official Bondholders' and Creditors' Committees seeks a 90 day extension of the periods in which it has the exclusive right to file a plan and solicit acceptances. The primary obstacle to filing a plan by Geneva is obtaining a commitment for adequate exit financing. Geneva has a deadline of December 30, 1999 to file an application for obtaining a guarantee under the Emergency Steel Loan Guarantee Act of 1999. Geneva cannot reasonably expect to receive a decision on its application to file a plan prior to February 28, 2000. HARNISCHFEGER: Seeking Approval of Beloit Auction Procedures ------------------------------------------------------------ Judge Walsh granted the Debtors' Motion at an expedited hearing convened to consider the Debtors' proposed procedures for auctioning Beloit's assets. Accordingly, on Friday, August 12, 1999, the Debtors caused notice of the auction to be published in The Wall Street Journal, The Asian Wall Street Journal and The Wall Street Journal Europe, announcing that a public Auction for Beloit's assets will be conducted at Young, Conaway, Stargatt & Taylor's offices at 10:00 a.m. on November 23, 1999. Notice of the Auction was also served on all potential qualified bidders known to the Debtors. To participate in the Auction, Qualified Bidders (meaning entities that enter into a confidentiality agreement and demonstrate financial ability to complete a purchase) must send a letter of interest to the Debtors' counsel, counsel to the Creditors' Committee, counsel for Equity Committee, counsel for the Prepetition Lenders, and counsel for the DIP Lenders no later than 4:00 p.m. on November 18, 1999. To establish a minimum bid at the Auction, the Debtors, with the consent of the Creditors' Committee, have secured the right to enter into one or more asset purchase agreements with one or more purchasers. The Debtors will notify every other Qualified Bidder of any Stalking Horse Agreement into which the Debtors enter. After the Debtors, with the consent of the Creditors' Committee, declare a Winning Bid as a result of the Auction process, they will file a Motion with the Bankruptcy Court seeking approval of the sale pursuant to 11 U.S.C. Sec. 363 and assumption and assignment of any relevant contracts and leases pursuant to 11 U.S.C. Sec. 365. Judge Walsh has scheduled a Sale Hearing for 5:00 p.m. on December 9, 1999. Objections to that Sale Motion must be presented no later than December 3, 1999. The Debtors contemplate that a Closing will take place immediately following the Sale Hearing, allowing the sale of Beloit's assets to be wrapped-up by year-end. (Harnischfeger Bankruptcy News Issue 15; Bankruptcy Creditor's Service Inc.) HEALTHSPHERE OF AMERICA: Seeks Extension To Exclusivity ------------------------------------------------------- The debtors, Healthsphere of America, Inc. and its affiliates seek an extension of the debtors' exclusive period of time within which to file a plan. The hearing on the Disclosure Statement has been scheduled for December 9, 1999. Since the debtor cannot solicit acceptances to the plan until approval of the Disclosure Statement, the debtor is seeking an extension through and including January 31, 2000. IMAGYN MEDICAL: Entry of Confirmation Order and Effective Date -------------------------------------------------------------- On October 18, 1999 the US Bankruptcy Court for the District of Delaware entered an order confirming the Joint Amended Plan of Reorganization of Imagyn Medical Technologies, Inc., et al. The Effective Date as defined in the plan occurred on November 1, 1999. IMAGYN MEDICAL: Reports Monthly Losses Exceeding Revenues --------------------------------------------------------- Imagyn Medical Technologies, Inc., operating as debtor-in- possession under its Chapter 11 bankruptcy action has reported, for the month of September 1999, net revenues of $3,114, sustaining net losses of $3,139. JUST FOR FEET: Wins Interim Approval of $200 Million DIP Loan ------------------------------------------------------------- Just For Feet Inc. on Wednesday won interim court approval of a $200 million in debtor-in-possession (DIP) financing from Bank of America Business Credit. Alan Miller of Weil Gotshal & Manges, counsel to the shoe retailer, said the company has court authorization to draw $60 million of the DIP loan. Bank of America is also the lead bank in Just For Feet's pre-petition senior secured credit facility. (The Daily Bankruptcy Review and ABI November 16, 1999) PACE HEALTH: 1998 Asset Sale Supplies Income In Recent Qtr. ----------------------------------------------------------- On October 7, 1998, Pace Health Management Systems Inc. completed the sale of substantially all of its assets to, and the assumption of certain of its liabilities by, Minnesota Mining and Manufacturing Company. In July 1999 the company received proceeds from the restricted escrow account totaling $555,958, including interest of $25,671. Approximately $195,000 currently remains in the escrow account pending resolution of certain disputed indemnification claims. The net proceeds from the sale will be retained by the company pending a determination of whether to engage in a follow-on transaction. The company has been seeking a business combination with another entity, before considering possible liquidation and distribution of its assets. If no suitable business combination is identified within a reasonable period of time, the company may elect to liquidate and distribute the remaining net proceeds to shareholders. If the company liquidated at the present time, all of the net assets of the company would be paid to holders of the company's preferred stock. Following the sales transaction, Pace Health Management has no ongoing operations, no revenues and has minimal operating expenses. The company presently has only one part-time employee, reflected in general and administrative expenses. While the company showed no revenue for the three and nine months ended September 30, 1999, the three month period yielded $17,348 in net income, while the nine month 1999 period showed a net loss of $51,040. In the three and nine month comparable periods of 1998 revenues were $403,685 and $1,110,305 respectively. The net losses for the period were $163,991 and $2,087,122 respectively. PHAR MOR: 13 Weeks Ended October 2, 1999 Yields $4,191 Net Loss --------------------------------------------------------------- Phar Mor Inc. reports net loss of $4,191 on net revenues of $317,835 for the thirteen weeks ended October 2, 1999. In the same thirteen week period of 1998, ending September 26, 1998, the company's net loss was $1,512 on net revenues of $269,412. PLANET HOLLYWOOD: Meeting of Creditors -------------------------------------- On October 12, 1999, Planet Hollywood International, Inc., et al. and its affiliated debtors filed voluntary petitions under Chapter 11. A meeting of creditors is scheduled for December 10, 1999 at 11:00 AM at the J. Caleb Boggs Federal Building, 844 King Street, Room 2313, Wilmington, DE. PLANET HOLLYWOOD: Hearing To Consider Disclosure Statement ---------------------------------------------------------- A hearing to consider the adequacy of the Disclosure Statement shall be held on December 9, 1999 at 12:30 PM at J. Caleb Boggs Federal Building, 844 King Street, Wilmington, DE. PLANET HOLLYWOOD: Bar Date Order -------------------------------- The US Bankruptcy Court for the District of Delaware entered an order requiring all persons and entities that assert a claim against the debtors must file a written proof of such claim with the Bankruptcy Court no later than 4:00 PM, December 13, 1999. POWER DESIGNS: Shows Net Sales Increase --------------------------------------- During the third quarter of fiscal 1999, Power Designs Inc. and its wholly-owned subsidiary, continued manufacturing operations as debtors-in-possession under Chapter 11 protection. The Vantage Partners LLC, a management consulting firm retained under court order, together with Melvin A. Becker, Vice President of Operations, continued in their roles as senior management. Product offerings were confined to three historical families of products: military grade power supplies, variable autotransformers, and linear switching power supply products. Employees and contracted consultants of the company at March 31, 1999 numbered 26. Results for the first nine months of fiscal 1999 reflect a significant downsizing in operations which followed the company's Chapter 11 filing, and therefore represent a substantial change from the pre-petition figures for the same period in fiscal 1998. Accordingly a period-to-period comparison of the historical results of operations and financial condition of the company may not be meaningful. Net sales increased to $604,698 for the quarter ended March 31, 1999 as compared with $523,907 for the same period in 1998. Net loss in the 1999 quarter was $51,107, while in the same 1998 quarter net loss was $470,281. Net sales increased from $1,760,746 for the nine months ended March 31, 1998 as compared to $2,161,598 for the nine months ended March 31, 1999. Again, net loss in the 1998 nine month period was considerably higher at $7,407,055 compared to the nine months of 1999 net loss of $80,099. PRIMARY HEALTH: Seeks Order Extending Exclusivity ------------------------------------------------- The debtors, Primary Health Systems, Inc. and its affiliates, seek an order further extending the exclusive periods during which the debtors may file a plan of reorganization and solicit acceptances thereof. A hearing to consider the motion will be held on November 19, 1999 at 9:30 AM. The debtors assert that they have had continuing discussions with their bank lenders concerning a plan, but because of the complexity of the issues underlying the cases, the debtors have not yet had an opportunity to complete those negotiations much less begin tri-partite negotiations with the banks and the Creditor's Committee. the debtors request 110-day extensions of each of the Exclusive Periods, through and including March 31, 2000 and May 30, 2000, respectively. The debtors state that they have focused their efforts upon stabilizing their business operations and implementing their long-range business plan. PSI INDUSTRIES: Counsel for Committee Approved ---------------------------------------------- The US Bankruptcy Court for the Southern District of Florida, Palm Beach Division, entered an order authorizing the Official Committee of Unsecured Creditors of PSI Industries Inc, debtor, to retain Thomas R. Lehman of the law firm of Tew Cardenas Rebak Kellogg Lehman DeMaria & Tague, LLP. RITE AID: KPMG Resigns as Auditor --------------------------------- Rite Aid Corp. disclosed that KPMG LLP, its auditor since 1968, resigned last week, which raises more questions about the extent of the drugstore chain's accounting problems, The Wall Street Journal reported. Rite Aid disclosed last month that it would restate earnings for the last three fiscal years, cutting off about $500 million in pre-tax earnings over that period. In June, Rite Aid already had restated those figures once to reverse aggressive accounting maneuvers. The Camp Hill, Pa., company anticipates a full investigation of its accounting practices by the Securities and Exchange Commission, and the company is facing numerous lawsuits from investors whose stock has plunged during the last year. An analyst with Maryland-based Center for Financial Research & Analysis said that KPMG's resignation suggests that Rite Aid's accounting problems are worse than disclosed and that KPMG is trying to distance itself. An accounting professor at the Stern School of Business in New York said that the resignation could mean that the firm and Rite Aid disagree on the restatements taken. SCORE BOARD: Order Confirming Chapter 11 Plan --------------------------------------------- An order confirming the Chapter 11 plan of The Score Board, Inc. was entered on November 5, 1999. SELECT SWITCH: Hearing Regarding Disclosure Statement ----------------------------------------------------- The hearing to consider the approval of the Disclosure statement of Select Switch Systems, Inc. will be held on December 14, 1999 at 10:30 AM before the Honorable Mitchel R. Goldberg, US Bankruptcy Judge, Courtroom 301 of the US Bankruptcy Court, 3420 Twelfth Street, Riverside California. SMITH CORONA: Quarterly Sales Decrease But Net Loss Is Reduced -------------------------------------------------------------- Smith Corona's net sales of $8.3 million for the quarter ended September 30, 1999 decreased 28 percent from last year's first quarter net sales of $11.6 million. The prior period net sales included $1.8 million related to products, primarily facsimile and telephony, that were discontinued during fiscal year 1999. Unit sales of typewriters were lower than a year ago, as a result of a declining market, although industry data indicates that the rate of decline in the typewriters and related supplies market has been slowing. The net loss experienced by the company in the three month period ended September 30, 1999, of $315 was considerably less than the net loss of the same period in 1998 when loss was $5,671. The company has continued its plans to expand and diversify its product offerings with a renewed emphasis on building on the market's recognition of the Smith Corona brand in printed document and data transmission products. Late in the first quarter of the fiscal year ending June 30, 2000, the company introduced its Inkjet SolutionsTM, which represents inkjet cartridges compatible with most major brand printers. The company expects to introduce an expanded line of commercial headsets in its second fiscal quarter. Smith Corona continues to negotiate with numerous suppliers to expand product offerings and develop new products such as inkjet printer supplies, commercial products, and introducing new models of typewriters and supplies. The company says it is intent on introducing products that drive consumable supplies businesses. STARTER CORP: Committee Objects To Extension of Exclusivity ----------------------------------------------------------- The Official Committee of Unsecured Creditors of Starter Corporation, et al. objects to the second motion of Starter Corporation, et al. for an order approving an extension of the exclusive periods during which the debtors may file a plan of reorganization and solicit acceptances thereof. According to the Committee, the debtors have made no serious overture to negotiate a consensual plan with the Committee. The Committee believes that the debtors fail to understand the extent of administrative and priority claims against the estates, and the Committee believes that an important first step would be to fix bar dates. If given an opportunity, the Committee claims that it would seek bar dates and would move forward with a liquidating plan or conversion of these cases to a Chapter 7. SUN HEALTHCARE: Government Seeks Stay of DIP Financing ------------------------------------------------------ At an emergency hearing convened to consider the Government's Motion for a Stay of the Interim DIP Financing Order, Judge Walrath rejected the Government's arguments, finding that the Government does meet the standards for the issuance of a stay pending appeal established by the Third Circuit in Evans v. Buchanan, 435 F. Supp. 832, 841 (D. Del. 1977): * HHS cannot demonstrate a likelihood of success on the merits; * HHS cannot demonstrate that it has not been adequately protected and, thus, irreparably harmed. * HHS cannot show that it is in the public interest to deprive one of the nation's largest health care companies with financing that is required to maintain the quality of service to over 40,000 elderly patients and residents. Balancing the hardships, Judge Walrath found, the interest of the Debtors in continuing to operate in reliance on the proceeds of the DIP Facility plainly is more important that the interest of HHS in seeking to preserve an alleged interest that, based upon the uncontroverted evidence presented at the October 22, 1999 hearing, if it exists at all, is adequately protected through the time the Court will consider final approval of the DIP Financing Facility. At the October 22 Hearing, the Debtors introduced evidence that the interest, if any, of HHS in Medicare receivables generated postpetition was adequately protected. HHS did not contest this evidence. In light of the record, this Court ruled at the October 22 Hearing that the interest of HHS arising from its purported right to seek to lift the automatic stay to setoff prepetition and postpetition obligations was adequately protected through the final hearing on the DIP Facility, scheduled for November 12, 1999. That ruling, Judge Walrath held, stands. Immediately thereafter, HHS rushed to the United States District Court for the District of Delaware again seeking a stay of the Interim DIP Financing order pending the outcome of its appeal of Judge Walrath's ruling. The District Court conducted a preliminary hearing, but withheld ruling so that the Debtors and HHS could attempt to reach an amicable resolution of their dispute. Ernest negotiation culminated in a Stipulation among the Debtors and HHS providing that: (a) if HHS can obtain relief from the automatic stay in order to withhold postpetition payments on account of prepetition overpayments, for other than the current fiscal year, then HHS will not make any actual adjustment, but will be granted an allowed administrative-priority claim for the amount that could have been withheld; (b) HHS will be granted allowed administrative priority claims for all current fiscal year prepetition overpayments, subject to the Debtors' right to object to the propriety of a setoff under 11 U.S.C. Sec. 553; (c) any allowed administrative priority claims held by HHS will be paid on the earliest to occur of: (1) assumption of the Medicare Contract, (2) the effective date of any confirmed plan of reorganization, (3) dismissal of the Debtors' chapter 11 cases, and (4) the time for payment of administrative expense claims under any plan of liquidation; (d) with respect to any underpayments for cost-years prior to 1999, HHS is granted the right to freeze payments to the Debtors on account of those underpayments, subject to the Debtors' right to file a motion to compel payment; (e) HHS agrees to withdraw its objections to the DIP Financing Facility and all motions and appeals arising from those objections presented to the Bankruptcy Court and the District Court and further agrees not to oppose entry of a Final DIP Financing Order; and (f) HHS acknowledges that its administrative priority claims, if any, shall be subordinate to the superpriority claims, if any, held by the DIP Lenders. (Sun Healthcare Bankruptcy News; Issue 5; Bankruptcy Creditor's Service, Inc.) TAPISTRON INTERNATIONAL: Fiscal Year Financials Offer Comparison ---------------------------------------------------------------- During its last three fiscal years, Tapistron International Inc. has generated substantial revenue from foreign sales. Revenue from foreign sales to unaffiliated customers totaled $892,675 in Fiscal 1999, compared to $1,176,020 in Fiscal 1998, compared to $2,584,903 in Fiscal 1997. The company has no identifiable assets specifically attributable to foreign sales during the periods presented, however, the company intends to expand its marketing efforts to generate additional export sales in future years. As of July 31, 1999, the company had 31 full-time employees and 1 part-time employee. Tapistron filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code on June 21, 1996 and operated its business as a debtor-in-possession under the jurisdiction of the Court. On August 18, 1997, the Court confirmed the Amended Plan of Reorganization. As of January 22, 1998, the Court closed the case by ordering the Final Decree. The company's Fiscal 1999 sales were $4,725,881, compared with $5,651,555 in Fiscal 1998 and $3,626,092 in Fiscal 1997. The net loss in Fiscal 1999 was $744,839, in Fiscal 1998, $208,608 and in Fiscal 1997, net income was $316,375. US PETSEC: May File for Bankruptcy Protection --------------------------------------------- Petsec Energy Ltd., Sydney, said that its U.S. subsidiary, Petsec Energy Inc., may file for chapter 11 protection to effect a restructuring, according to Reuters. The Australian group has decided not to advance further funds to the U.S. group until a capital reconstruction proposal is presented. The American company did not have sufficient funds to meet its expected capital commitments in the near-term and has been evaluating a number of additional financing options. The U.S. unit has decided not to make a $3.2 million principal payment to its banks, which had caused a cross-default with noteholders. (ABI 16-Nov-99) VIDIKRON TECHNOLOGIES: Files Chapter 7 -------------------------------------- Vidikron Technologies Group Inc., New York, which makes high-end home theater products, said yesterday that it has filed chapter 7 of the Bankruptcy Code, according to a newswire report. In July the company had announced it was considering the filing. WESTMORELAND COAL: Reports Third Quarter Results ------------------------------------------------ Westmoreland Coal Company (Amex: WLB) today reported a net loss of $3.1 million for the third quarter ended September 30, 1999, which is a $1.1 million improvement over second quarter 1999 results. The improvement was due to increased revenues at Westmoreland Resources, Inc. ("WRI"), lower overhead costs and higher interest income. Set against a background of $6.4 million in retiree benefit expenses for the period, the loss for the third quarter 1999 was influenced primarily by the continued decline in the bond market during the quarter which caused a $450,000 non-cash negative adjustment in the value of the black lung trust fund investment; a continued reduction in coal throughput at Dominion Terminal Associates ("DTA") due to the further decline in the export coal market; and a reduction in equity in earnings from Westmoreland Energy, Inc. ("WEI") due to the previous sale of the Rensselaer project. Net income was $0.3 million for the comparable quarter in 1998 when certain retiree benefit expenses were stayed while the Company operated under protection of the Bankruptcy Court. Christopher K. Seglem, Westmoreland's Chairman, President, and CEO said: "Results from operations were improved, but still somewhat lower than expected this quarter. Our independent power facilities operated well, and endured the heat, drought and hurricanes that plagued the east coast. However, coal shipments from WRI, while reflecting completion of the scheduled maintenance outage at WRI's largest customer, fell short because of the loss of shipments to another customer, Otter Tail Power, due to test burns of other coals there. That contract will expire at the end of this year when Otter Tail, whose power plant we supply is not now scrubbed, shifts to lower sulfur coal in order to comply with Phase II of the Clean Air Act. DTA experienced increased losses in the third quarter in connection with the further downturn in the export coal market. Finally, an additional decline in the bond market resulted in a further negative non-cash adjustment of our black lung trust fund investment. The Company is taking steps to address these issues." "In another important area, the impact of substantial accumulated, unpaid preferred dividends was further lessened during the third quarter as a result of the second tender offer completed in October," continued Seglem. "The decision to offer that additional opportunity for our preferred shareholders to sell their shares back at a price above current market even when it might create a shareholders' deficit, reflects the importance of the preferred dividend issue to all of us and the strategic use of cash by the Company." "Underlying all operating results, of course, are the very large heritage costs which continue to burden the Company. They will cause the Company to operate at a loss until they are reduced or new sources of income are brought on line. On the legislative front, we continue to follow developments regarding the insolvency of the UMWA Combined Benefit Fund and the possible transfer of additional subsidies to it from the Abandoned Mine Land Reclamation Fund, at least as a stop-gap measure. Separately, we are also tracking the possible inclusion of prescription drug costs under Medicare coverage, which could alleviate the UMWA Combined Benefit Fund situation and lower our costs." "Aside from such initiatives which could reduce our industry's and Company's singularly high retiree costs, future profitability lies in the growth and expansion of the Company. The energy industry is undergoing extraordinary change at this time, presenting both great challenges and great opportunities. We are concentrating current efforts on maximizing the value of existing operations and assets and are actively pursuing opportunities to use available cash to reinforce and grow our base in the energy sector in order to achieve sustained profitability. Available cash balances of $31.9 million are currently earning money market returns, pending investment in higher return opportunities," Seglem concluded. Net loss applicable to common shareholders was $3.8 million after deduction of $0.7 million for unpaid preferred dividends for the third quarter of 1999 compared to a net loss of $0.9 million for the same period in 1998. As a result of the repurchase of 412,536 depositary shares through the second tender offer completed on October 26, quarterly preferred stock dividends in future quarters will be reduced from $0.7 million to $0.4 million. Accumulated but unpaid preferred dividends were reduced to $8.9 million from $13.3 million because of the October tender offer and from $22.0 million before the first tender. The Company currently has 834,833 depositary shares outstanding, each representing one-quarter of a share of preferred stock. Payment of preferred stock dividends are subject to restrictions under Delaware law. Shareholders' equity was $7.4 million at September 30, 1999, and will be reduced at October 31, 1999 by $7.8 million, the cost of repurchasing the depositary shares in the second tender offer. Consolidated cash and cash equivalents at September 30, 1999 totaled $31.9 million and will also be reduced by $7.8 million for the tender offer. If a shareholders' deficit results from the second tender offer, payment of dividends is prohibited until such time as positive shareholders' equity is attained and other requirements under Delaware law are met. Net income was $5.2 million for the first nine months of 1999 and included increased equity in earnings from WEI as a result of the sale of its remaining interest in the Rensselaer Project in the first quarter. Net income for the comparable period in 1998 was $38.6 million and included increased equity in earnings from WEI resulting from the restructuring of the Rensselaer Project power purchase contract. Net income applicable to common shareholders was $3.2 million for the first nine months of 1999 and $35.0 million for the same period in 1998. Cash used in operating activities was $30.8 million for the first nine months of 1999 compared to cash provided by operating activities of $56.5 million for the same period in 1998. The difference is largely due to the payment of pre-petition liabilities and reorganization costs and the funding of security deposits in 1999, and the cash received from the restructuring of the Rensselaer Project power purchase contract and the termination of the Company's over-funded salaried pension plan in 1998. Westmoreland will file its third quarter 1999 Form 10-Q with the Securities and Exchange Commission today. Shareholders and others interested in receiving a copy of the third quarter 1999 Form 10-Q or 1998 Form 10-K/A can request copies by writing to the Company at the following address: Westmoreland Coal Company, 2 North Cascade Avenue, 14th Floor, Colorado Springs, CO, 80903. The Forms are also available electronically through the Securities and Exchange Commission's EDGAR system. Westmoreland Coal Company, headquartered in Colorado Springs, CO, emerged from Chapter 11 on January 4, 1999 satisfying all debt obligations with interest and with its shareholders' interests undiluted. The Company is currently engaged in western Powder River Basin Coal mining through its 80%-owned subsidiary Westmoreland Resources, Inc. and independent power production through its wholly owned subsidiary Westmoreland Energy, Inc. The Company also holds a 20% interest in Dominion Terminal Associates, a coal shipping and terminal facility in Newport News, Virginia. WILSHIRE FINANCIAL: Reports Third Quarter Results of Operations --------------------------------------------------------------- Wilshire Financial Services Group Inc. (OTC BB:WFSG) today reported results of operations for the quarter ended September 30, 1999, the first full quarter following the Company's emergence from bankruptcy on June 10, 1999. Excluding non-cash market valuation losses and impairments, the Company reported operating income of $1.5 million for the quarter. "During and subsequent to the reorganization process, we have diligently reduced Wilshire's overhead, put a new management team in place, reduced our exposure to market valuation adjustments and focused the Company on its core banking and loan servicing businesses," said Stephen P. Glennon, Chief Executive Officer of Wilshire Financial Services Group. "I am pleased to report that the third quarter reflected our substantial progress in these efforts, with total non-interest expenses, excluding servicing fees, down some$9 million from a year ago. Servicing revenue nearly doubled last year's level as a result of the Company's acquisition of Wilshire Credit Corporation, our prior third party servicer, and the inclusion of its revenues in this year's quarter following our restructuring. "So far during the fourth quarter, we have made substantial progress in reducing short-term debt in our non-banking operations and have initiated programs to streamline and reduce the overhead associated with our European operations. In our banking operations, we have taken steps to address OTS regulatory concerns, including the appointment of a new CEO of First Bank of Beverly Hills, FSB, and specific programs to address interest rate risk. As a result of these continuing initiatives, we believe that the Company will be strongly positioned to achieve growth of our servicing and banking business, with substantially reduced overhead." Net loss for the quarter was $7.1 million, or $0.36 per share. Results for the predecessor company (pre-reorganization) for the comparable period in 1998 are not meaningful for comparative purposes. Net interest income for the quarter was approximately $7.3 million, which consisted of interest income of $16.7 million, partially offset by interest expense of $9.4 million. Approximately $13.1 million, or 79%, of interest income was derived from the Company's portfolio of loans and discounted loans, with the other $3.6 million, or 21%, from mortgage-backed and other securities. Interest expense consisted of $6.5 million of interest on deposits at First Bank and $2.9 million of interest on short-term debt facilities. Provision for losses on loans for the three months ended September 30, 1999 was a net recovery of $0.7 million. Other income was a net loss of $0.1 million, consisting primarily of market valuation losses and impairments of $8.6 million, partially offset by income from real estate operations of $2.6 million, servicing revenue of $1.9 million, and other income, net, of $3.2 million. Other expenses totaled approximately $14.7 million for the quarter. These expenses consisted primarily of compensation and employee benefits expenses of $ 8.7 million, loan service fees and expenses of $139,000, professional services of $1.7 million, corporate travel and development of $1.0 million and other general and administrative expenses (consisting primarily of insurance, taxes and general corporate overhead) of approximately $2.1 million. During the third quarter, the Company recorded market valuation losses and impairments of $8.6 million, which was comprised primarily of write-downs of mortgage-backed securities pending sale ($5.1 million), write-downs of other assets ($1.9 million) and a charge of approximately $1.6 million for the Company's investment in Wilshire Real Estate Investment Inc. ("WREI"), formerly an affiliate of WFSG. Wilshire is committed to its goals of growing its core banking and servicing businesses while maintaining controls on corporate overhead, without a dependence on gain-on-sale transactions. The Company's operations going forward are focused on two primary business units: -- First Bank of Beverly Hills, FSB, a thrift with approximately $613 million of total assets and $460 million of deposits. First Bank is engaged in the acquisition of mortgage loans, origination of mortgage loans, and merchant bankcard processing. The primary source of financing for First Bank's acquisitions and originations is wholesale and brokered certificates of deposit, and to a lesser extent, committed short- term line of credit facilities and FHLB advances. First Bank is a federally chartered savings bank and is regulated by the Office of Thrift Supervision ("OTS"). Due to the bankruptcy filing of WFSG and the resignation of the CEO of the bank, the OTS in June designated First Bank a "Troubled Institution" under OTS regulations. Separately today, the Company announced that the bank has named a new CEO, Richard Cupp. The Company plans to continue to work with the OTS to address its remaining concerns regarding its "Troubled Institution" designation. -- Loan Servicing through Wilshire Credit Corporation, a subsidiary formed as part of the plan of reorganization. Its principal business is servicing and resolving distressed and management-intensive assets. Both Standard and Poor's and Fitch IBCA have indicated reaffirmation of WCC's servicing strengths. WISER OIL: 5.33% Of Stock Held By Paul Glenn & Revocable Trust -------------------------------------------------------------- Paul F. Glenn, Trustee, of the Paul F. Glenn Revocable Trust, has sole power to vote or dispose of 400,000 shares of the common stock of Wiser Oil Company, and he has shared voting and dispositive power over 77,500 such shares. This amount represents 5.33% of the outstanding shares of common stock of Wiser Oil. Mr. Glenn's principal occupation is investing for the Trust and for his own account. He is an executive officer and director of the Paul F. Glenn Foundation for Medical Research, Inc., an Arizona non-profit corporation. All of funds used by Mr. Glenn to acquire the securities were his personal funds or funds borrowed on margin accounts in the ordinary course of business at various securities brokerage firms at which he maintains securities trading accounts. The securities were acquired for investment purposes. Mr. Glenn may make additional purchases of the company's securities either in the open market or in private transactions, depending upon his evaluation of the company's business, prospects and financial condition; the market for the company's securities; general economic conditions; money and stock market conditions; and other future developments. Depending on these same factors, he may decide to sell all or part of the investments in the company's securities. WORLDPORT COMMUNICATIONS: Involuntary Petition Filed By Employees ----------------------------------------------------------------- WorldPort Communications, Inc. (OTC: WRDP) today announced that four former employees have filed an involuntary bankruptcy petition against the Company in the United States Bankruptcy Court for the Northern District of Georgia, Atlanta Division. The petitioners allege specific claims totaling $99,000 against the Company in their petition. The Company disputes the petitioner's claims and intends to immediately contest the petition. The Company has previously announced the execution of a series of definitive agreements to sell WorldPort Communications Europe Holdings, B.V. and associated assets in an all cash transaction to Energis plc for an estimated value of $570 million. The Company intends to apply a portion of the net proceeds to be realized from this sale to repay all existing debt, including its bridge facility, trade credit and other liabilities. It is expected that the Company will consider a new strategic focus following this sale utilizing the remaining net proceeds. WorldPort Communications, Inc., headquartered in Atlanta, Georgia (USA), provides international telecommunications and Internet services primarily to ISPs, long distance carriers, medium and large corporate customers in Europe and North America. WorldPort offers domestic and international voice, data, video, Internet and other telecommunication services over a network of terrestrial and undersea cables, switches, and other network equipment and through interconnection agreements with major carriers in Europe and North America. For more information, please visit the WorldPort web site at www.wrdp.com. ********* 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. Copyright 1999. All rights reserved. ISSN 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *