Compaq Computer Corp has rejected about $5m worth of power supply products from Simi Valley, California-based Golden Systems Inc, citing poor quality and has ordered a halt in production of the affected model: Golden Systems said the fault could be traced to the use of printed circuit boards from a single vendor supplied during June, July and August but that as a result of Compaq’s action, Golden Systems is in default under the terms of its lines of bank credit and is implementing emergency cost reduction measures to conserve cash; it says Compaq Computer’s action is excessive and could place its continued existence in serious doubt because Compaq accounts for about 70% of its power supply product sales.
