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SOUTHMARK SUBMITS SETTLEMENT PROPOSAL

 SOUTHMARK SUBMITS SETTLEMENT PROPOSAL
 DALLAS, Dec. 6 /PRNewswire/ -- Southmark Corporation (OTC) today


announced that it has submitted for court approval a proposal that would settle significant competing claims of the company and one of its major creditors, the Resolution Trust Corporation (RTC). The claims center on the control and ownership of proceeds from the sale by Southmark of its insurance operations.
 "This proposal," said Glen Adams, president and chief executive officer of Southmark, "would bring us another significant step closer to completing the mission we've been given, which is to realize the value of our assets and to distribute that value to our creditors."
 Parties to the proposed settlement are Southmark, certain of its subsidiaries, the RTC, as receiver for the failed San Jacinto Savings Association and two subsidiaries of the failed Lincoln Savings & Loan.
 At stake are a $68 million judgment against a Southmark subsidiary and a $40.5 million promissory note Southmark issued to San Jacinto Savings. This note had been issued to San Jacinto as a component of $100 million in assets to be disbursed by Southmark to San Jacinto under Southmark's Chapter 11 Plan of Reorganization. If the RTC and court approve, the settlement would provide for distribution to Southmark of cash and securities worth approximately $13.6 million, plus certain real estate interests. The RTC would potentially receive about $30 million in cash, subject to certain contingencies and satisfaction of the $40.5 million note and other non-cash assets.
 Adams said that the company plans to seek court consideration of the matter in early January. "All parties to this proposed settlement are in the business of winding things up while preserving the greatest value," he said. "This settlement accomplishes that goal."
 Attorneys for all parties have agreed to recommend acceptance of the proposal.
 Southmark Corporation is engaged in the court-approved liquidation of its assets.
 -0- 12/6/91
 /CONTACT: Susan A. Seiter of Susan Seiter Associates, 214-533-7524 (today only) or 817-488-3142; or Charles B. Brewer, executive vice president of Southmark, 214-406-6775/ CO: Southmark Corporation ST: Texas IN: INS SU:


GK -- NY053 -- 0188 12/06/91 14:55 EST
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Publication:PR Newswire
Date:Dec 6, 1991
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