I read in today's paper that Cendyne is out of business. A major investor was upset with Cendyne giving away too much rebates.

Anyone hear/read this?

Tuesday, August 19, 2003
Ruling forces CenDyne to shut offices
Judge orders computer DVD drive maker to pay creditor Test Rite, which took over operations, $20 million.

By TAMARA CHUANG
The Orange County Register


SANTA ANA – CenDyne Inc. was forced to shut down Monday after a state judge ruled that it had to repay a Taiwanese creditor more than $20 million.

CenDyne, one of the biggest brands in computer DVD drives, already was reeling from mounting losses and top-level resignations.

For the first six months this year, CenDyne lost $17.5 million, which spurred the lawsuit from Test Rite International, the Taiwanese investor that provided CenDyne with inventory and services. Test Rite seized control of the company two weeks ago.

On Thursday, California Superior Court Judge Robert H. Gallivan ordered CenDyne to pay its creditors and appointed Robb Evans & Associates as receiver.

"We're trying to liquidate the assets of the company for the benefit of the creditors," said Brick Kane, chief operating officer at Robb Evans.

CenDyne's Susan Street offices were somber Monday as employees learned the news. A security guard sat outside to inform those who had not heard. CenDyne employed 72 people.

Gavin McCalla, CenDyne's chief executive officer, and Bob Miles, CenDyne's chief financial officer, did not return calls seeking comment Monday.

McCalla and Miles are also CEO and CFO at the U.S. division of Test Rite. Test Rite, which provides packaging, design and logistics to retailers, invested $4.5 million in CenDyne last summer, gaining 42 percent of the company, said Test Rite.

Test Rite, based locally in Ontario, took control of the privately held CenDyne after founders Ed Meadows, Mo Vahdati and Dean Vahdati, abruptly resigned.

Test Rite's lawsuit alleged that the trio made false statements "with the intent to defraud and deceive" Test Rite in order to attract investment.

Test Rite said it had discovered in November that CenDyne had doled out $2.4 million in "secret" consumer rebates and price guarantees to retailers, which caused CenDyne to restate its financial reports.

Another $2.8 million in rebates was discovered in July, the lawsuit says.

The lawsuit alleged that CenDyne owed Test Rite $22.7 million for the purchase of goods, rebate liabilities and short-term liabilities.

Test Rite's lawyers did not return calls.

Meadows, CenDyne's former president, and Mo Vahdati, former chief executive, did not return calls. Dean Vahdati could not be reached for comment.

Test Rite says it has suffered from its investment in CenDyne.

On July 29, JP Morgan downgraded Test Rite's stock to "underweight" from "overweight" and lowered its earnings estimate by 29 percent because of "significantly worse results at CenDyne versus our original forecast." CenDyne's losses had hit $17.5 million for the first half of the year, and more losses were revealed to Test Rite in July, the lawsuit said.

Last year, CenDyne was the leading brand in computer DVD drives sold at retail, according to The NPD Group.

It captured 17.7 percent of the market, significantly ahead of second-place I/OMagic Corp., at 10 percent, and Sony Corp., at 7.8 percent.

In the first six months of this year, CenDyne dropped to second place, at 13.7 percent, while Sony moved to the lead with 20.5 percent.

"It's a healthy industry, but the industry is competitive," said Tom Edwards, senior industry analyst for NPD.

"It's an industry that, as I've said for 25 years, it eats its young. If CenDyne leaves, somebody else will step in."

Source: Orange County Register 8/19/2003 (www.ocregister.com)

OC Register Cendyne Article

interesting news.....

I hope the rest of the rebates get paid out fast.

I suggest that anyone who is going to get a rebate from them ..............Make sure that your rebate shows up on the website at RebatesHQ.

Ultimately.....the retailer is responsible for the rebate.....if Cendyne disappears....since the MFR and retailer jointly created the promotion.

I wouldn't worry too much....I would just make sure that your rebate exists in the RebatesHQ database.....

Too bad. Wonder if this will have any effect on the amount of deals available on this stuff at the consumer level. At least KHypermedia is still in business...

Oh great. I just bought a bunch of Cendyne stuff recently. Oh well. I'm sure the retailer will make good on the rebates.

Same here. I better get my rebates!!!

Maybe we can get some good cendyne (lite-on) deals?!

LOL, I'm sure there will be - probably with "manufacturer" rebates.

Dear OfficeMax Customer,

I do apologize. Please do not worry OfficeMax stands behind all of the rebates and Cendyne will pay them. Thank you.

Denise
Rebate Specialist


-----Original Message-----
From: titewad
Sent: Tuesday, August 19, 2003 9:00 PM
To: Brock, Denise
Subject: Cendyne rebates


Hello Denise,

Within the past month, I purchased two Cendyne products with rebates totaling $120 at Office Max. Today I read that Cendyne has been taken over by a group of investors and has filed for bankruptcy. My concern is the rebates. Will Cendyne pay them? If not, will Office Max pay them? If not, will Office Max accept the products for return?

Article: http://www2.ocregister.com/ocrweb/ocr/arti...&month=8&day=19

Thank you.

(This is not an on-topic deal but a public service announcement, since Cendyne deals are very common in IRD)

From a News.com article: Cendyne (has gone bankrupt and) will not be honoring rebates or warranties.

They are in receivership (not in a Chapter 11) --- not too many chances of a recovery.

Please do not buy any Cendyne drives with mail-in-rebates (there are a few on sale this week in Officemax/Staples and probably other stores too; more might appear in the coming weeks). These rebates will not be honored.

If you have already bought a drive, and have not sent the rebate yet, return it. If you have sent the rebate, wait and see. Try calling the rebate center and see what they have to say (usually Parago, I think). If your rebate is ultimately rejected, try to take the rejection letter to the store where you bought it from, and see if the manager is willing to give you a gift card for the value of the rebate. If you bought it online from Staples or Officemax, still take everything to your local store and see if your manager is sympathetic. As a last resort, write to the Corporate Office of whatever store you bought it from, informing them that it was advertised with a rebate, and you are very disappointed that it has not been honored.

I must remind you that this advice is preliminary. We must wait and see how the situation develops in the coming days.

Meanwhile, the good news might be that Cendyne stock could start showing up as clearance if Cendyne is liquidated --- you could get a new DVD+/-RW really cheap (no warranty though).

Please post your comments, and any responses you may get about Cendyne rebates from Staples/Officemax, etc. Customer Service or Corporate, as well as the official lines from the rebate centers.

[Thanks to HarleyD's post in Computer Help which gave me the idea of alerting people in IRD, since it is the most popular forum, and IRD is also where Cendyne deals are usually found]

ruh roh!

I see no reason to accept anything less than a check or cash. OfficeMax was advertising the rebate, and so they will have to honor it. It's been reported that they have agreed that they will honor all rebates, but we'll just have to wait and see.

Since Cendyne simply "rebadges" drives, it may still be possible to get warranty work done from the original manufacturer. That remains to be seen though.

I have about $130 in outstanding Cendyne rebates (although some of that is from OMAX itself). We'll see what happens.

Unpaid rebates by Cendyne, GO AFTER THE RETAIL STORE WHERE YOU BOUGHT YOUR PRODUCTS!!!!!!!!!!

ACCEPT NOTHING LES THAN CASH OR A CREDIT BACK TO THE CREDIT CARD!!

IF THAT DOES SOLVE THE PROBLEM, DISPUTE THE REBATE AMOUNT WITH THE CREDIT CARD COMPANY. TO BE SAFE, ALWAYS CHARGE EVERYTHING WITH AMEX

here is an interesting update:

this info was acquired from another person at another site:

did anyone recently deposit their cendyne checks? i have some which i fear depositing as i have read many stories of checks bouncing!

If you received the checks were funded by Staples or OfficeMax, you shold be safe. I heard ppl said if you cash them and the checks bounce, you won't be charged. But if you deposit the checks, you will be charged. You'd better call your bank and verify the above. BTW, I received two checks and deposited them yesterday which were funded by Staples and OfficeMax. Will report back if the checks got bounce.
Good luck to all.

Just to update.

I made sure early on that all my Cendyne rebates showed up on the website after I heard about the Bankruptcy.

I recently received all outstanding rebates from Cendyne.

Mine were funded by Staples and OfficeMax since they were the retailers involved for the Cendyne rebates that i sent.

So, this worked out for me. I hope everyone else makes sure to check and see if their rebate shows up and is valid. I'm assuming they will close the whole Cendyne issue very very very quickly.

I just got a Cendyne check funded by OMax. Cashed it with no problems. That's my last one from Cendyne, so I'm happy to have it done with.

I also received my Cendyne check funded by OM last week. No problems and it even came a heck of a lot faster than I expected.

At the bottom of the postcard rebate, it said,

"We apologize if your receipt of this check was delayed.

However, CenDyne, Inc., the promotion sponsor, has entered into court-appointed receivership and ceased funding the promotion.

We are happy to inform you that OfficeMax has chosen to fund your rebate check in place of CenDyne, in order to ensure the best possible experience for you, a valued OfficeMax customer."

I got my rebate check yesterday from Cendyne. Should I cash it? Thanks in
advance.