expects to pay off all its debts this year after a dramatic turn around in its fortunes.

Creditors will be told at a special meeting today that the Club increased its income by over $250,000 during 1992 and is now on a much-better financial footing.

Scandal manager Mr. Al Eastmond said yesterday: "Our future looks very rosy.

Last year was a complete non-event for business as a whole in Bermuda but what we managed to do was incredible.

"This time last year the chances of Scandal surviving were about one percent.

It would have been very easy to have walked away from it.

"After a great year, our chances of survival are about 99 percent. We've repaid some of our debt and I think everyone will get paid this year.

"We're looking very, very strong. We've spent a lot of time and effort preparing for the coming season and I'm optimistic.'' Over the last two months, Bermuda Supreme Court has made two awards totalling almost $100,000 against Inter-Rest Management, which owns Scandal. But Mr.

Kenneth DeFontes, who is a director of IRM, said the judgments did not constitute an immediate threat to the future of the business.

"I believe the company has a chance of pulling through as long as it doesn't get further into debt,'' he said. "But it might take two years.'' Both Mr. DeFontes and Mr. Eastmond said the company's debts had nothing to do with the running of the night club but would not go into details.

It is widely believed that IRM's problems may be linked to the disappearance about two years ago of one of its directors, Mr. Michael Haegele, who owns 40 percent of the company.

IRM's creditors want to question Mr. Haegele about the disappearance of $500,000 from the company, The Royal Gazette has been told.

Mr. Haegele left behind a number of debts in Bermuda when he fled, some of them allegedly related to gambling.

Businessmen in the gambling resort of Atlantic City have also been trying to reach him in connection with alleged gambling debts run up there.

Although creditors have tracked Mr. Haegele down to a restaurant in Surrey, in England, it is understood they have not pursued him.

Mr. Eastmond said Scandal had managed to change its fortunes by successfully targeting locals in the 18 to 25 age group.

Several advertisements have also been placed in US college magazines, in conjunction with the Bermuda Department of Tourism, in an effort to revive College Weeks, he said.

"Everything's in place for us to have a good year and to start the season as one of Bermuda's best night clubs,'' said Mr. Eastmond.

Mr. Kenneth DeFontes.