Play Meter

UPDATE EDITION
September 1 , 1980
Volume 6 , Number 1 6
Seeburg debt plan goes to creditors
A plan for reorganization of the
Seeburg Corporation under the
Bankruptcy Code has been accepted
by a federal court in Illinois , and
unsecured creditors of Seeburg were
given until July 24 to vote accept-
ance or rejection of the plan .
The basic payout on which un -
secured creditors are voting on is 30
percent of claims' amounts.
In order for the reorganization
plan to be accepted, creditors who
hold at least two-thirds of the amount
owed in claims ( more than $2
million in total) and more than half of
number of claims must vote in favor
of the plan .
The
settlement
agreement -
contingent on that acceptance-
considers the sale to Stern Electron -
ics of "substantially all of the assets"
of the Seeburg company, which is a
wholly owned subsidiary of Consoli-
dated Entertainment Inc. , another
Delaware corporation and owned
and controlled by members of the
family of Louis J . Nicastro . Seeburg
currently occupies premises owned
by Xcor International. Inc . at 1500
N. Dayton Street , Chicago , and
leased to Seeburg .
Stern would buy all Seeburg assets
except patents, for $1 ,243 ,750 , and
Seeburg would grant Stern a right to
its patents for an additional $50,000
payment. A further $350,000 would
be paid by Stern to Seeburg on
August 31, 1983 if by that time Stern
has manufactured a total of 25 ,200
coin -operated jukeboxes . The same
amount would be paid one year later
if Stern has manufactured a total of
33,600 jukeboxes under the Seeburg
name.
Xcor , under this agreement , could
continue to make jukeboxes under
the Seeburg name but would have to
state in any and all advertising for
such jukeboxes "that the products
and services being sold are not
affiliated with Stern ." Stern would be
required to furnish Xcor with vending
machine and jukebox parts it requires
for three years after the agreement is
final.
Stern would also agree to pay
Chase Manhattan Bank of New York
$187,500 for its security interest in
Seeburg's inventory which includes
the parts inventory.
The court notice showed Seeburg
assets on October 19, 1979 , at which
time it filed under Chapter 11 of the
Bankruptcy Code , to be $7 ,037 ,279
and at that time its total indebtedness
was set at $7 ,773 ,577 . Its notes
receivable and trade accounts receiv-
able are pledged to the Chase Bank .
The Seeburg firm was started in
1907 in Chicago. It was sold by the
Seeburg family in 1956 in order to
meet estate tax obligations . A
Pennsylvania investor at that time
turned Seeburg into a public corp-
oration . Seeburg became X cor Inter-
national in 1977 but was later
separated from Xcor as the Nicastro-
held corporation of Seeburg .
Atari meeting unwraps 50-cent games
Th e sixth annual Atari Distributor
meeting . called "Th e Atari Round -
up." was held at The Wigwam in
Phoenix . Arizona, April 26 - 30 and
was attended by over 200 people.
including Atari personnel and dis-
tributors from around the world .
Unveiled at the meeting was
Atari's new Missile Command game,
which will be shipped from the
factory set on 50-cent play .
An Atari spokesman told PLAY
METER that Missile Command on
test locations had pulled revenue well
against machines on 25 -cent play .
The new game will be adjustable to a
quarter or 50 cents per play.
In a highlight of the business
essions. Gene Lipkin. president of
Atari's Coin -Operated Games Divis-
ion , announced that 1979 was a
record year for Atari, and that 1980
Atari President Robbins
would easily surpass that mark of
growth and sales . " Product accept-
ance is greater than ever," he said ,
citing contemporary packaging and
advanced technology as factors .
Ray Kassar. chairman of the board
of Atari , gave an overview of the
Consumer Division and stated that
Atari 's entry into the computer
business opened an important new
market with the introduction of the
Atari 400 and BOO computers . He
also pointed out that both divisions of
Atari are investing heavily in research
and development.
Manny Gerard , of the presidents'
office, reiterated this theme, saying
the Sunnyvale manufacturer spends
more on R&D than the rest of the in-
dustry . "This will continue ," he said,
"because it is good business ."
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