Senate Republicans Give Bankruptcy Bill 50 Percent of Passing
The optimism that was so prevalent last week for moving the bankruptcy
overhaul legislation through Congress by attaching it to the
Transportation bill (H.R. 4475) disappeared yesterday in negotiations,
according to the CQ Daily Monitor. Senate Majority Leader Trent
Lott (Miss.), Senate Judiciary Committee Chairman Orrin Hatch (R-Utah),
and bill author Charles Grassley (R-Iowa) agreed that the likelihood for
getting the bill through in the final days is now no more than 50
percent. House Speaker Dennis Hastert (R-Ill.) and Lott are trying to
find legislation to which they can attach bankruptcy, Grassley said.
“I’ve had three things singled out to me in the last three
weeks (for attaching bankruptcy), and each one has fallen
through,” he said. “I think, legitimately, that each
appropriations subcommittee chairman works hard for 12 months and I
don’t blame them for not wanting a controversial provision put
in.” Lott said he would favor getting the bill attached to minimum
wage legislation (H.R. 833). To do that, however, he would have to
overcome blocking maneuvers that have proven too difficult so far.
Leading Economic Indicators Drop for Fourth Consecutive Month
The Conference Board reported yesterday that its Leading Index of
Economic Indicators declined for the fourth consecutive month, according
to the White House Bulletin. The Index dropped 0.1 percent in
August to 105.7. Conference Board economist Ken Goldstein said,
“The flat pace in the leading indicators points to continued
moderations in U.S. economic activity. This is reflected in indicators
for the manufacturing, housing, consumer, labor and financial markets.
The economy is starting to reflect the impact of growth restraints.
Interest rate and growth restraints will determine how much slower the
economy will be in the last few months of the year.”
Grand Union Files for Bankruptcy The struggling supermarket
chain, Grand Union Co., yesterday filed for bankruptcy for the
third time in five years and said it was talking with potential bidders
about a sale, according to a company announced the latest in a wave of
cost-cutting steps aimed at boosting profitability. Grand Union has been
hurt by thin profit margins in a competitive market.
The company, which operates 197 retail food stores in five
northeastern states, said stores will remain open and employees will be
paid as usual. It said major supplier, C&S Wholesale Grocers, agreed
to provide the stores with a regular flow of merchandise and that other
suppliers are expected to continue regular shipments. Grand Union also
said it has received a $60 million loan commitment from lender Lehman
Commercial Paper. It plans to use the funds to help pay vendors and
operate the business.
Hearings Set On AmeriServe Sale to Wal-Mart
AmeriServe Food Distribution Inc. said yesterday that the U.S.
Bankruptcy Court in Wilmington, Del. has approved extensions of the
company's bankruptcy financing and set hearings on its plans to sell its
U.S. distribution assets to a Wal-Mart Stores Inc. subsidiary, according
to a Reuters report. Based in Addison, Texas, a suburb of Dallas,
AmeriServe is one of the nation's largest distributors specializing in
serving chain restaurants including the KFC, Pizza Hut and Taco Bell
brands owned by Tricon Global Restaurants Inc. Tricon has agreed to
extend its distribution agreement for company-owned restaurants through
Oct. 31. The court approved an extension of the financing through Oct.
30 and authorized further debtor-in-possession (DIP) financing
extensions that are agreed to by AmeriServe and its lenders.
Pseudo Programs Inc. Files for Chapter 11 Protection
Pseudo Programs Inc., the pioneering and original broadband
entertainment company, yesterday announced that it filed and will seek
to reorganize its business under the protection of a chapter 11
bankruptcy proceeding, according to a newswire report. The filing was
made in the U.S. Bankruptcy Court for the Southern District of New York.
The company, which ceased production of its live, interactive
programming and laid off its 175-person workforce on Sept. 18, continues
actively to pursue a buyer for its brand of interactive, streaming video
entertainment, its patent-pending operating system and other proprietary
software, and its state-of-the-art Webcasting production facilities.
Allied Capital Responds to Net-Tel Bankruptcy Filing
Allied Capital Corporation yesterday addressed investor
questions regarding the recent bankruptcy filing of Net-Tel
Communications Inc, according to a newswire report. Headquartered in
Washington, D.C., Allied Capital invested approximately $22 million in
Net-Tel, the majority of which is senior secured debt. The recent
inquiries regarding the Net-Tel bankruptcy stemmed from a Washington
Post article that erroneously reported Allied Capital's investment to be
$33 million.
Net-Tel Communications experienced recent liquidity and funding
problems, and with the consent of its lenders chose to seek chapter 11
bankruptcy protection. Allied Capital is working with Net-Tel and its
other lenders and investors to resolve its funding needs. Allied Capital
is a business development company that provides long-term investment
capital to fuel the expansion of growing companies nationwide.
Former Seattle-Area Computer CEO, His Wife Accused of Bankruptcy
Deception
Bankruptcy trustee Virginia Burdette, who is overseeing the
personal-bankruptcy proceedings of former Microworkz.com owner Rick
Latman and his wife, contends the couple failed to accurately report
their finances and is seeking to prevent them from writing off more than
$450,000 in debts, according to the Seattle Times. Meanwhile, a
Department of Justice source confirmed yesterday that the FBI has opened
a criminal investigation into Latman's business dealings. No charges
have been filed. Burdette filed a complaint contending that Latman and
his wife, Bettina, 'knowingly and fraudulently' submitted false
information regarding their finances under oath. The trustee, who
represents the interests of unsecured creditors in the proceedings,
asked that the court dismiss their chapter 7 petition and refuse to
forgive their debts.
Latman acknowledged that some of the material in the bankruptcy
petition is likely wrong, but insisted the mistakes are innocent. 'We
were under a great deal of stress,' he said. 'I never wanted to file
bankruptcy. This is our fault, but I never intended to defraud anyone or
hide assets.'
The complaint and federal investigation are only the latest troubles
to beset Latman, who 15 months ago was chief executive officer of the
now-defunct Microworkz.com, a Lynnwood, Wash.-based company marketing
low-priced computers. Last month, the state Attorney General's Office
announced Microworkz.com was fined $1.5 million for illegal business
practices.
NETtel Corp. Chapter 11 Petition Cites $133.5 Million In Assets
NETtel Corp.'s chapter 11 petition, filed Thursday in the U.S.
Bankruptcy Court in Washington, D.C., lists assets of $133.5 million and
debts of $155.7 million as of Aug. 31. NETtel is the operating company
of its parent NETtel Communications Inc., which owns 100% of NETtel's
stock. The parent is a nationwide integrated communications provider
that focuses on medium-sized business customers.
Courtesy of
href='http://www.fedfil.com/bankruptcy/developments.htm'>The Daily
Bankruptcy Review Copyright © October 4,
2000.
Thanks for visiting
Today's Bankruptcy Headlines. New articles are posted here each business
day.
|
