• 1 P age A 4 « __________________________ F ebruary 26, 1997 • T he P or i land O bserver GM stockholders sue General Motors Corp Stock­ holders have sued to block the $9 5 bi Ilion sale of most o f G M ’ s H ughes defense unit to Raytheon Co. The four lawsuits, filed Feb 5 and 6 in Delaware Chancery Court but not made public until Monday, seek class action status. The lawsuits, which name GM and its 14 officers and directors, claim the sale o f Hughes will cheat G M 's Class H shareholders out o f a 20 percent premium they were promised by the autom aker if Hughes was sold. Hughes Aircraft is a division of Hughes Electronics Corp., which also makes telecommunications sat­ ellites and automotive electronics. GM owns all o f the assets o f Hughes Electronics, but the shares trade as GM Class II stock and their performance is tied to Hughes's earn­ ings. Holders o f Class II stock have dividend claims but no equity inter­ est in the company According to Tuesday’s editions o f the Boston Globe, G M ’s corpo­ rate charter provides that if the carmaker decided to sei I all or nearly all o f Hughes’ assets. Class H share­ holders would be entitled to exchange their shares for 1.2 shares o f GM common stock That is the 20 per­ cent premimum the suing share­ holders seek and it would cost GM about $1.2 billion. GM could not be immediately reached for comment, but a spokes­ man told the Boston Globe the company believes the suits were without merit and said "we intend to defend ourselves vigorously.” G M ’s stock rose 50 cents at $59.50 and G M ’s Class II stock gained 62.5 cents to $60.625 while Raytheon fell 37.5 cents to $47, all on the New York Stock Exchange. Selas posts record revenue Selas Corporation o f America (AMEX: SLS)reported record rev­ enue for 1996. with the Company breaking the $100 million mark for the first time in its history. Earnings for the year jum ped 80% over those o f 1995. Consolidated net income for the quarter ended December 31, 1996, was $ 1,409,000, or $0.39 per share, fuIly di luted compared to $826,000, or $0.24 per share for the similar period in 1995, an increase o f 63%. Net sales in the quarter were $29,671,000 versus $17.056,000 in 1995. For the 12 months ended De­ cember 31, 1996, Selas reported net income o f $ 4 ,130,000, or $ 1.16 per share fully diluted mpared to net income o f $2,300.000, or $0.66 per share in 1995. Revenues for the year were $103,426,000, ver­ sus $71,215,000 in 1995, up 45%. Stephen F. Ryan, president and ch ief executive o fficer o f Republic Industries completes acquisition Republic Industries, Inc. (Nasdaq: RWIN) today announced the clos­ ing o f its acquisition o f National Car Rental System, Inc. National, headquartered in Min­ neapolis, Minnesota, operates a fleet o f approximately 100,000 vehicles in the United States. The company has approximately 800 locations in the United States and Canada and has marketing affiliations in Latin America, Europe, Japan and the Caribbean In connection with the transac­ tion which will be accounted for under the pooling o f interests method o f accounting. Republic will issue approximately 21.7 million shares o f common stock Republic is a diversified com­ pany operating in the automotive, solid waste and electronic security industries. Selas, said that all segm ents o f the Com pany perform ed profitably in 1996, with the greatest im prove­ ment com ing in the heat technol­ ogy segm ent which entered the y ear with a record backlog and added to it during the year with four m ajor new orders. Earnings for that segm ent in­ creased 204% on an 93% increase in revenues. He said that new business activity in that segment remains high. Resistance Technology, Inc., the Selas subsidiary supplying precision electromechanical and plastics com­ ponents for the hearing aid, medical products and cellular communica­ tions industries, continued its growth in both sales and earnings In 1996 that subsidiary showed an increase o f 42% in earnings on a revenue increase o f 10%. According to Ryan.D euer Manu- facturingv the C om pany's subsid­ iary that manufactures spare tire -X MUST PRESENT THIS AD TO REDEEM OFFER DEWAXING HAND & MACHINE SANDING FOR ADHESION CAREFUL MASKING ADVANCED ACRYLIC PAINT t-YEAR WARRANTY AGAINST FADING Commissioner Quackenbush de­ manded today that the millions o f dollars, including interest, in unse­ cured loans owed to Golden Eagle/ Mesa Reinsurance by John Mabee, the former owner o f both compa­ nies, be repaid. On Jan. 31, I997, Commissioner Quackenbush served a court order to take over control and operation o f Golden Eagle Insurance Company The order also included putting Mesa Reinsurance into the conservator- ship. Commissioner Quackenbush was particu larly concerned about the $66 million in unsecured loans taken by John Mabee Investigators learned that the original indication of $66 million has increased to $69 mil­ lion. "M y first concern is for the con­ sumers, policyholders, and claim­ ants o f Golden Eagle. That is why I am issuing a demand letter requir­ ing that Mr. Mabee return the $69 million he owes Mesa Reinsurance so that it will be available to Golden Eagle policyholders. If that demand is not met, I am prepared to tile a lawsuit to recover the millions o f missing dollars,” said Commissioner Quackenbush. "I intend to go after every nickel o f the $69 million owed by Mr Mabee and return it back to the company.” As part o f the takeover by the Department o f Insurance, half a million dollars’ worth o f imported luxury automobiles owned by Golden Eagle Insurance Company and used by former upper-management have been repossessed. One o f the luxury cars seized is a 12-cy linder Mercedes Benz, equipped with bullet-proof windows. The cars will be sold and the proceeds will go directly to the companies now under conservator- ship "Excessive spending in the form o f luxury cars and the $69 million in personal loans is no way to operate an insurance company in Califor­ nia,” Commissioner Quackenbush said A d d itio n a lly , C o m m issio n e r Quackenbush announced that he has signed an agreement with Liberty Mutual Group which will provide financial stability and enhanced safety for policyholders o f Golden Eagle Insurance Company, as well as a continued market for its agents and brokers. Under the terms o f the reinsurance agreem ent, L iberty Mutual will assume 100% o f all losses on virtually all new and re­ newal policies issued by Golden Eagle from March I, 1997, until the completion ofthe rehabilitation plan. "This historic agreement means that Golden Eagle policyholders can rest easier knowing their claims will be backed by Liberty Mutual, a com­ pany with over $5 billion in surplus," said Commissioner Quackenbush. Com m issionerQuackeribushalso announced that he issued a Request for Proposals (RFP) for a Rehabili­ tation Plan for Golden Eagle. 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Trucks, Vans, Sport/Utility Vehicles and some colors slightly higher oimmi.l.ii« lliiiiim Advertise In holders and lifts for the automotive industry, suffered the loss in 1995 o f a major account and that had an impact on its performance through­ out 1996. He said, however, that this unit has been able to recover sufficiently to end the year on a profitable basis. “ We expect 1997 to continue the improvements made in 1996 and see all segments moving forward,” Ryan said. "From all indications at this time, we are confident that 1997 will be another exceptional year for Selas.” Selas Corporation o f America is adiversified firm with international operations and sales that engages in the design, development, engi­ neering and manufacturing o f a range o f products including preci­ sion electronic and electromechani- cal/plastic components, heat pro­ cessing equipment and systems, and cable winch products for the automotive industry. 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