Reorganization OK Awaited by Computer Firm : Eagle Says It Could Go Out of Business Quickly

Eagle Computer Inc. said it is probable that it will go out of business in a week if a reorganization plan filed in U.S. Bankruptcy Court Wednesday is not approved by the Bank of America, its major creditor.

The plan would give B of A 22% ownership of the failing company as payment of a $4.8-million debt. An investment group that has been pumping operating funds into the company since June would receive a 40% interest in Eagle.

The bank, which received an outline of the proposal last month, is looking at the plan but does not know when it will make a decision, a bank spokesman said.

Eagle needs the bank’s approval by July 31 for any reorganization or it will face liquidation, Senior Vice President Richard Thunen said.

The investment group that has been financing Eagle’s operations since June 1 is unwilling to continue beyond the end of the month, Thunen said. He would not reveal the name of the group.

The investment group is requiring the bank’s approval of the reorganization plan before pumping $500,000 more into Eagle, Thunen said, adding that the group is acting as an agent for an existing corporation that would own 40% of Eagle if the reorganization is approved.

“We believe that this reorganization plan provides the only potential for Bank of America and Eagle’s other creditors to recover their debt,” said Gary Kappenman, Eagle’s president and chief executive.

Under the reorganization plan, filed late Tuesday, Eagle would issue about 6 million shares of stock.

The biggest chunk, 2.4 million shares, would go to the new investors. Bank of America would receive 1.3 million shares and a group of about 450 other creditors would receive 600,000 shares. An additional 930,000 shares would go to Eagle’s 15,000 current common stockholders, who would trade in their existing shares. Eagle’s only preferred stockholder, KE&C; America, would trade in its shares for 100,000 shares of the new common stock.

The remaining new shares would be held in reserve by Eagle for future distribution.