The bankruptcy petitions – 11 in all – filed by Continental Information Systems Corp on January 13 show that the company’s assets totalled $1,862m while its liabilities came to $1,806m. The documents were signed not by the company’s founder and chairman, Harry Goetzmann Jr, but by its former chief financial officer and current vice president for finance, Tom Prinzing. Among the posted assets was goodwill of $56.3m, partially offset by negative goodwill of $14.8m on the other side of the ledger. Thus the Syracuse, New York, company had, by a small amount, a positive tangible net worth, assuming any residual values on its books will, in aggregate be realised – a big assumption. The bankruptcy code mandates a petitioner’s filing of certain initial reckonings in addition to basic financial data. For instance, the 20 largest unsecured creditors must be made public, along with the amount CIS believes it owed them at the moment of filing. CIS broke its list in two, one for creditors of the eponymous entity that is the direct descendent of the CIS of two years ago, the other for creditors of CMI, the leasing company it bought in its ill-fated effort to grow by acquisition. Thus far, we have not obtained a breakdown of moneys owed CIS. These sums will now be collected, we are confident, as quickly as the law allows, regardless of any mercy CIS’ management might have shown in the past. The bankruptcy lawyers at Levin & Weintraub & Crames are generally in charge of chairman Geotzmann’s largesse. The CIS portion’s largest unsecured creditors, whose total inadvertent contribution to the cause is about $82.5m, includes Banque de la Societe Financiere, of Paris, to which CIS owes $20.5m; Manufacturers Hanover Trust Co, Syracuse, owed $15m; Chase Lincoln First Bank, Syracuse, owed $15m; Norstar Bank of Upstate New York, Syracuse owed $10m; First American Bank of New York, Syracuse, owed $5m; First Source Bank (South Bend, Indiana, owed $5m; Key Bank of Central New York, Syracuse, owed $3m; Merchants National Bank & Trust Co, Syracuse, owed $2.5m; Dean Witter Reynolds, New York, owed $1.25m; Connecticut National Bank, Hartford, owed $1m; Niagara Mohawk Power Corp, Syracuse, owed $656,000; New York Life Insurance, New York, owed $641,000; Monarch Systems Group, Springfield, Massachusetts, owed $535,000; TRW Inc, Orange, California, owed $493,000; Data Hardware Inc, Bloomington, Minnesota, owed $475,000; Philadelphia Savings Fund (Philadelphia, owed $472,000; CCH Computax, Los Angeles, $463,000; Corning Glass Works, based in Corning, New York, which is $262,000 out of pocket; and Citibank, New York City, owed $236,000.
Unsecured creditors The unsecured creditors listed by CMI and CMI Holdings, due in total $5.8m, include Electronic Data Systems, Plano, Texas, owed $870,000; EDS Financial Corp, Dallas, which is in for $598,000; Coamerica Bank & Bell Helicopter Corporate Trust, Detroit, owed $566,000; Principal Mutual Life Insurance, Des Moines, owed $370,000; Potomac Electric Power, Washington, DC, in for $367,000; Texaco, Inc Comptrollers, Houston, owed $334,500; Texaco, Inc, Houston, owed $308,000; Unilease, Newark, New Jersey, owed $254,000; Winnebago Acceptance Corp, Forest City, Iowa, owed $223,000; The Meridian Group, Deerfield, Illinois, owed $220,000; K-Mart, Troy, Michigan, looking for $205,000; Equilease Marketing Corp, New York, owed $196,500; Crum & Forster, Morristown, New Jersey, owed $193,000; Ethyl Corp, Richmond, Virginia, owed $190,000; CUNA Mutual Insurance Society, Madison, Wisconsin, $165,000; Blue Cross/Blue Shield of Delaware, Wilmington, owed $163,000; Citicorp Information Systems Research, Parsippany, New Jersey, $158,000; Well Fargo Bank, San Francisco, owed $152,000; EUA Services Corp, West Bridgewater, Massachusetts, $147,000; and Ford Aerospace & Communications, Newport Beach, California, owed $141,000. When it filed for court protection, CIS and its subsidiaries were involved in a number of lawsuits and arbitration proceedings. These pre petition suits may well be derailed by CIS’ bankruptcy; at the very leas
t, some aggrieved parties may have to begin anew their efforts to settle disputes. Among the plaintiffs pressing substantial claims are Coastal Airways, claiming $1.5m; Aerolease International, claiming $1m; Phillips Medical Systems, claiming $2.5m; and Joseph Gasperini, claiming $5m. In addition, Industrie Leasing SA, a Swiss company, has a court ordered claim against CIS of approximately $31.2m and an additional claim against CIS’ German subsidiary for another $485,000. And Continental has several suits, including countersuits and arbitrations, pending against other parties. – Hesh Wiener