HOSPITAL STILL IN TALKS WITH KEY CREDITORS.

Byline: Naush Boghossian Staff Writer

SANTA CLARITA - With the deadline to avoid bankruptcy come and gone, Henry Mayo Newhall Memorial Hospital's second and third largest creditors did not accept the voluntary settlement offer, officials said.

Hospital representative Andie Bogdan said that the hospital officials will continue efforts in the next week to convince the creditors to jump on board.

``We haven't given up hope, and we'll still try to get these guys next week,'' Bogdan said.

Newhall Memorial officials have one week to tally the ballots and finalize verbal agreements - a time they will spend continuing to convince large creditors to sign on.

On Friday, they will announce the success or failure of the voluntary settlement.

In order to pay off a $10 million debt incurred mainly after the 1994 Northridge Earthquake forced extensive repairs, they began what many believe is an unprecedented attempt by a hospital to avoid a court-supervised business reorganization.

Hospital officials personally placed calls to each of the 125 biggest creditors - who compose 90 percent of the total amount of past due payables - to persuade them to accept 22.5 cents on the dollar for past-due bills.

To avoid bankruptcy, the hospital had to sign on as many creditors that would add up to 90 percent of the total amount due.

After weeks of intensive campaigning, the hospital was able to persuade 90 of the largest 125 to settle. The largest creditor, UCLA, signed a ballot on Oct. 20, in what hospital officials considered a huge success.

But one of the large creditors has placed an attachment on the cash the hospital has set aside to pay its creditors.

If the hospital files Chapter 11, it will continue operating regularly, but it will have to submit a plan of reorganization to the bankruptcy court that factors how it plans to pay back all its creditors.