Cover-All Closing 21 of 23 Locations

Chatsworth, CA, Feb. 12, 2009--A financially troubled California flooring installation company owned by local developer Gadi Leshem is closing all but two of its facilities.

Bankruptcy records from Leshem on behalf of Cover-All Inc., which operates mostly in the Midwest and west, indicate the company plans to maintain only two of its 23 facilities nationwide.

"It is the debtor's intention to keep only its Las Vegas and Chatsworth facilities open," Leshem wrote in a declaration filed last week in U.S. Bankruptcy Court for the Central District of California.

"The debtor is working diligently at each location that is being shut down to facilitate the shutdown in an expedient manner to the satisfaction of the respective landlords."

Leshem estimates the sale of assets from the 21 closed facilities will generate $291,966 in revenue.

Cover-All filed for Chapter 11 bankruptcy last month, citing $1 million in assets and about $25 million in debts involving 731 creditors.

There are also disputed unsecured claims of nearly $7 million from the Internal Revenue Service and $5.3 million from the California State Compensation Insurance Fund against Cover-All, bankruptcy documents indicate.

Bank of the West is Cover-All's largest creditor and is owed about $9 million.

The Home Depot, which is Cover-All's largest customer, wants to sever ties with the company because of complaints from its retail stores and vendors about poor service.