Teller, 3 Others on Helionetics Board Resign
Helionetics Inc., the struggling Irvine defense contractor, announced Tuesday that four of its 10 directors, including Nobel Prize winning physicist Edward Teller and two retired Pentagon officials, have resigned from its board in part because the company lost its directors’ liability insurance.
In addition, the company said its chairman, Wilson K. Talley, a University of California professor, is delaying his resignation by several weeks to reduce the upheaval on the board. Two of the board positions were filled by less-prominent Southland businessmen, and the remaining two seats are left vacant.
The resignations are the latest in a series of blows to hit Helionetics during the past several months. Earlier this year, the company received a default notice on a $4.5-million loan and said overdue interest payments on another loan totaled more than $550,000. At about the same time, the company revealed that it lost $22.4 million in 1985, the most ever in its rocky history.
Although the company’s second quarter ended Monday, President Michael Mann declined to discuss the results.
However, he acknowledged that the company is talking to Bank of America about restructuring its $11.5-million loan and said the issue could be nearing a resolution.
In addition to Teller, a retired University of California physicist who is known as the father of the hydrogen bomb, retired Navy Admiral Thomas B. Hayward, retired Air Force General David C. Jones and George de B. Bell, co-chairman of the Philadelphia investment banking firm of Janney Montgomery Scott Inc., resigned from the company’s board.
Although the resignations remove some of the big-name military brass and scientists who brought a rather small company to prominence, Helionetics officials said their replacements will give the company the business expertise that it sorely needs at this critical time.
“We’re losing a number of more recognizable names, but we’re adding some very solid capabilities in our areas of business,” Mann said of newly named directors Howard W. Boehmer and Raymond S. Freed.
Boehmer retired recently from Hughes Aircraft Co. in El Segundo, where he served as a vice president and group executive in the Electro-Optical and Data Systems group. Currently, Boehmer consults with universities and the aerospace industry in the areas of electro-optical systems, equipment engineering, and overall corporate and business management.
Until recently, Freed was president and chief executive of Elec-Trol in Saugus, a major supplier of electro-mechanical and electro-optical switching components to the high-tech market. Freed started the company in 1961 and sold it in 1982.
Mann said each of the former directors, for a variety of personal reasons, had been planning to leave the board before the company’s loss of its directors’ liability insurance. Mann said the directors chose not to renew the director’s liability policy when it expired Monday because the company could not afford the steep premiums being charged.
