"OUII/ty IS Our Flml/y Tradition·
nEWS
STERN FILES FOR
CHAPTER 11
TOKENS
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IN CA 800-227-5814
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HOFFMAN {J HOFFMAN
P.O. Box 896, Carmel, CA 93921
10
Gary Stern, president of Stern
Electronics, announced on July 5
that Stern had filed for reorgani-
zation under Chapter 11 of the
bankruptcy laws.
Old debts had accumulated at
Stern during years when the games
business was more lucrative. "I have
decided that it is in the best interest
of Stern to file Chapter 11 with the
purpose of resolving this old debt,"
Stern said in a press release.
Stern has been beset with finan-
cial woes before. In 1982, amid
reports of financial difficulties, Stern
gained new life with a multi-million
dollar loan agreement with U .S.
Billiards and Albert Simon, Inc. The
capital was intended to replace a
portion of the capital extended to
preserve Stern's image when Martin
Bromley, who owned half of Stern's
stock through a charitable trust, was
arrested in London on charges of
skimming profits from slot machines.
Stern spent $15 million to repur-
chase stock from Bromley. (Play
Meter, May 1, 1982, p. 18)
Stern was formed in 1976 as a
pinball manufacturer. In 1980 its first
video game, Astro Invader, was pro-
duced . In 1982 Stern announced
plans to stop manufacturing pins
and to become more involved with
the production of videos. Its most
successful videos included Berzerk
and Scramble.
Stern was hurt by the laser games,
as were other manufacturers. The
industry thought laser games would
be a messiah, and nearly every com-
pany rushed to have a laser pro-
duced. Stern introduced Cliff
Hanger and Goa/ to Go. Neither was
well received. Unfortunately, the
laser phenomenon came and went,
leaving a trail of expensive laser
games that no one wanted .
Stern purchased the name, equip-
ment, and assets of Seeburg Cor-
poration in 1979 after Seeburg filed
for reorganization under Chapter
11 . Stern recently sold Seeburg.
Stern also purchased Universal
Research Laboratories in 1979 after
URL had also filed Chapter 11.
Stern is hoping to strengthen its
financial position by diversifying
into other fields of electronics by
manufacturing for other companies
and introducing its own products.
These include products for the tele-
communications industry, for home
installation by cable television oper-
ators, and a heating, venting, and air
conditioning product. Stern will
also remain active in the games busi-
ness.
According to Gary Stern, whose
background includes practice with a
bankruptcy law firm, " From my
experience, I believe that in six
months you will see a new and
stronger Stern. I do not believe this
will be a complicated and lengthy
proceeding."
•
MYLST AR NAMES DISTRIBUTORS
Mylstar Electronics has changed
its distribution network in Houston
and Chicago.
H .A. Franz Co. of Houston has
been appointed as a factory autho-
rized distributor for the Houston
and South Texas markets.
The Chicago and Northern Illinois
markets will be handled by Atari
Distributing, Inc.
"We are pleased and proud to
have Hoddy Franz of H .A . Franz Co.,
Ed Pellegrini of Atari , and their
excellent staffs representing our
lines and look forward to many fine
years of working together," said
Gilbert Pollock, Mylstar' s vice presi-
dent of sales and merchandising. •
PLAY METER, September 1. 1984