Rialto Ripples

Rumors of the Rialto's demise are greatly exaggerated.

Bankrupt but afloat after a battering in court, the Rialto Theatre threw a Christmas bash last week featuring the talented zaftig Candye Kane.

Festive in her holiday red and white, Kane, funny and sometimes raunchy, prodded the boys in her band to switch gears for a seasonal number that required one restart.

"Bells will be ringing," she sang.

For whom?

Kane's sweet-sad holiday songs and other blues and country numbers were a delight for the crowd, young and old, fresh and worn, straight, gay, bi and pan, on a cold, moist Saturday night.

Rialto men Jeb Schoonover and Paul Barrington have booked Dead Kennedys for January 23.

They need Dead Presidents.

Defeats in U.S. Bankruptcy Court last month and on December 4 are pressing down on the Rialto, the 82-year-old theater that joins the Hotel Congress at the east gateway to downtown. The court losses have created a negative whisper campaign, some of it emanating from promoters and backers of the gilded Fox Theatre several blocks west.

That is not lost on Schoonover, who followed his basketball-playing father and sorority mother to the University of Arizona.

Talking about red-taped grants--$218,000 from the state Heritage Fund and $61,000 from city Back to Basics--Schoonover says, "We want half as much as the Fox and we'll do twice as much."

Barrington and Schoonover, who dived with Rialto into bankruptcy court in 1997, sought more time to complete negotiations on a settlement with Rich Rodgers, the investment handler who arranged the sale of the Rialto, then an empty hulk, in 1995.

Schoonover, the music man who books talent, manages some acts and constantly promotes downtown events including the Weekly's biannual Club Crawls, had his personal bankruptcy in and out in just a few months in 1997.

It hasn't been that easy for the Rialto, its related businesses and Barrington in a consolidated filing handled pro bono, Schoonover says, by Michael McGrath, a talented lawyer and Rialto fan from the well-connected firm Mesch Clark Rothschild.

Barrington, a founder of community radio KXCI, started in the hole, borrowing the $65,000 down payment from family, friends and backer Brad Singer of Zia Records.

Banged up by a protracted and nasty battle with investor Erich Avedisian (Weekly, April 10, 1997), the Rialto men faced a balloon payment of $265,000. That balloon has floated, been extended, and floated some more.

Tick tock.

By November, Barrington and Rialto needed to come up with $150,000 for Rodgers.

All lawyered-up--Rodgers is riding Clifford Altfeld--the two sides were still talking settlement.

McGrath, in a pleading to Judge James M. Marlar, contended that he, because of a court date on November 20, had insufficient time the next day to review a counterproposal from Rodgers, whose empty spaces downtown are clearly marked with his lease and sales signs.

Also key was keeping the matter in court to ensure the transfer of the property to the Rialto Foundation.

"This transfer was the heart of the plan," McGrath wrote.

Earlier in the bankruptcy, McGrath had enabled Barrington and the Rialto to wipe away numerous small debts including $3,004 to Imperial Premium Finance of Los Angeles; $2,292 to Roadrunner Rolloffs; $587 to Pioneer Paints; $292 to Muller Music Center; $156 to Acme Lighting and others.

Now he was seeking delay in the $150,000 payment based on Rodgers' unspecified ability to pay underlying lien holders without Barrington's payment.

"The reason the debtor has requested relief from the stipulation is because actions taken by the Rodgers Group which reasonably led the debtor to believe that no payment to the underlying lien holders was due and hence the $150,000 due to the Rodgers Group was also not due before the entire note matured in December 2002," McGrath told the bankruptcy judge. Barrington, McGrath added, "was led to believe by the actions of [Rodgers] that no payment had been made, which occasioned the request for relief."

Four years ago, the Barrington and Rialto bankruptcy plan included the stipulation that the debt to Rodgers would be reduced by $150,000 on November 30, 2001.

Rodgers, court papers show, chose to pay off his underlying lien holders earlier.

Judge Marlar, on November 21, said that move by Rodgers did give Barrington and Rialto a pass.

"Rodgers' unilateral decision to pay off its debts earlier does not grant [Barrington and Rialto] a windfall," Marlar wrote. "The debtor is still bound by the plan. Further modification is unwarranted because circumstances have not changed. Regardless of Rodgers' early pay off to its own creditors, the debtor's obligation to pay $150,000 on November 30 has not been altered."

McGrath tried again, with a motion for reconsideration, saying the two sides had been in negotiation at the time of the Marlar's November 21 ruling.

Marlar was unmoved.

"That the parties were engaged in settlement talks on or after that date is immaterial. The parties did not advise the court to continue to withhold its ruling," Marlar wrote in a December 4 decision on the Rialto bankruptcy.

Schoonover says the Rialto plan was to pay half, $75,000, by the end of November.

Agitated by the whispers of the Rialto's demise, Schoonover embarked on a accelerated mission of damage control with a recent unannounced jaunt to the Weekly.

Despite the court setback, the promoter said, the Rialto would not close.

He and Barrington, then in Vegas for a gathering of historic theater people, had come too far.

There was more money from other sources, Schoonover said, to tap if needed.

And for the Candye Kane audience, Schoonover was back at it. In tight coat and a pork pie hat, he moved among fans of Kane and fans of the Rialto. A hands-on sort, he put them where they were needed.

The show was a nice gift to Tucson.

The Rialto could use one in return.

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