Smith Technology Files for Bankruptcy

Debt-ridden Smith Technology Corp., an environmental cleanup company that tried to restructure operations, has filed a bankruptcy petition in Delaware to reorganize its financial obligations. Smith listed $72.3 million in liabilities, more than three times its $22.2 million in assets, in the U.S. Bankruptcy Court petition filed Wednesday. The majority of that debt consists of loans from Chase Manhattan Bank and BTM Capital Corp., each of which is owed $24.2 million. The Newport Beach company has a string of annual losses. It posted its largest loss, $20 million, for the fiscal year ended September 1996. Two months later, its stock was delisted from Nasdaq for insufficient assets. It now trades over the counter, closing unchanged Friday at 38 cents a share. Smith had tried to restructure its operations in the last six months, but most of the executives who were hired or promoted now are gone. In August, it sold its engineering division, which accounted for 22% of its total revenue. Earlier, it sold several consulting offices. By the end of August, it had 600 employees in 14 offices nationwide, and it had just won a government contract that is expected to generate $68 million over five years. Company officials were not available for comment Friday.