DISCOVERY ZONE SEEKS TO REORGANIZE UNDER CHAPTER 11
FORT LAUDERDALE, Fla., March 25, 1996 - Discovery Zone, Inc. (Nasdaq: ZONE)
announced today that it has filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy
Code in the U.S. Bankruptcy Court for the District of Delaware. The Company said that it elected
to seek court protection in order to facilitate the implementation of its operational turnaround and a
Discovery Zone said that it will operate in the normal course of business during the reorganization
proceeding and that it has received a commitment for $15 million in debtor-in-possession ("DIP")
"We believe reorganizing under Chapter 11 is in the best interests of the Company," said Donna
Moore, Chief Executive Officer of Discovery Zone. "A successful Chapter 11 reorganization will
address the problems caused by the Company's rapid expansion and put Discovery Zone on
stronger financial footing."
Moore continued: "Discovery Zone is a viable concept, and we have an opportunity to revitalize
our operations with new marketing programs and entertainment concepts that will improve the
Discovery Zone experience for kids and their parents."
Discovery Zone said that it would move immediately to close unprofitable store locations in order
to improve its operating cost structure and allow the Company to focus on core markets and
locations. Discovery Zone said that it would also continue to seek to reduce operating costs in
remaining locations, primarily through the renegotiation of unfavorable leases to reduce occupancy
Separately, Discovery Zone announced that Donna Moore has been named President and Chief
Executive Officer and a director of the Company.
Moore had served as President and Chief Operating Officer of Discovery Zone since joining the
Company in July 1995. Moore, a 35- year veteran of consumer retailing, has held various
management positions in retailing with major consumer-oriented companies, including President of
the North American division of Laura Ashley, Inc., where she successfully oversaw a major
reorganization. From 1987 to 1992, Moore was Senior Vice President - Stores for The Walt
Disney Co. and spearheaded the dramatic growth of The Disney Stores from a 2-store test
concept to an international entertainment retailer with over 150 locations. Before joining The Walt
Disney Co., Moore was Senior Vice President - Stores of Williams-Sonoma, where she oversaw
the growth of that company from 17 stores to more than 80 locations. Prior to that, Moore was
Vice President of Retailing at Marriott and developed that company's retail concept from 14
in-hotel gift shops to 150 resort and specialty shops. Moore was most recently with Motherhood
Maternity, where she held the positions of President and Chief Executive Officer since 1993.
Additionally, Discovery Zone announced that Sumner Redstone, Chairman and CEO of Viacom
Inc., and Phillippe Dauman, Deputy Chairman and Executive Vice President of Viacom Inc. have
resigned their positions as directors of Discovery Zone. Discovery Zone said that Adam Phillips,
Senior Vice President and General Counsel of Blockbuster Entertainment Group was appointed a
director of the Company. J. Brian McGrath and John L. Muething continue to serve as directors of
Discovery Zone. Viacom has a substantial interest in Discovery Zone through its acquisition in 1994
of Blockbuster Entertainment Group.
Discovery Zone is the leading operator of children's indoor entertainment and fitness facilities.
CONTACT: Robert Mead, for Discovery Zone, 305-627-2643 or 212-484-6701
LOUISIANA GAMING COMMISSION APPROVES GRAND PALAIS MOVE TO LAKE
BILOXI, Miss., March 25, 1996 - Casino America, Inc. (Nasdaq: CSNO) announced today that
the Louisiana Riverboat Gaming Commission approved the Company's application to move the
Grand Palais's Riverboat to Lake Charles, Louisiana, as well as the Company's plan to acquire
Crown Casino Corporation's 50% interest in St. Charles Gaming Company for 1,850,000 shares
of Casino America common stock and other consideration.
The closing of the transaction is subject to a number of other conditions, including confirmation of
the Plan of Reorganization by the Bankruptcy Court in the Eastern District of Louisiana, approval
by the Louisiana State Police Riverboat Gaming Enforcement Division and other consents and
approvals. The parties are currently anticipating a closing of the transaction to occur within 45 days.
Casino America, Inc. owns and operates four riverboat and dockside casinos. The Company
currently operates the Isle of Capri Casino in Biloxi, Mississippi, the Isle of Capri Casino in
Vicksburg, Mississippi and the Isle of Capri Casino in Bossier City, Louisiana. The Isle of Capri
Casino in Bossier City, Louisiana is a joint venture between Casino America, Inc. and Louisiana
Downs. This joint venture also has a separate joint venture with Crown Casino Corporation to
operate an Isle of Capri Casino near Lake Charles, Louisiana.
CONTACT: Allan B. Solomon, Executive Vice President, 407-995-6660, or Rex Yeisley, Chief
Financial Officer, 601-436-7054, both of Casino America
Coltec Industries announces first quarter charge of 13 cents
NEW YORK -- March 25, 1996 -- Coltec Industries Inc (NYSE:COT) will take a pre-tax
charge of approximately $14 million ($9.2 million after tax, or 13 cents per share) in the 1996 first
quarter resulting from the cessation of shipments of landing gears and flight control systems for the
Fokker 70 and 100 aircraft. Fokker has filed for bankruptcy and stopped producing these aircraft.
The charge will provide primarily for the write-off of non- recurring development costs, losses on
foreign exchange contracts, vendor claims, inventories and receivables related to the programs.
In addition, full-year pre-tax earnings will be reduced by $4 million ($2.6 million after tax, or four
cents per share) as a result of lost sales on the Fokker 70 and 100 programs.
Coltec Industries is a New York-based manufacturing company serving aerospace, automotive and
other industrial markets.
CONTACT: Coltec Industries, New York; Michael Dunn, (212) 940-0523
CAMBRIDGE BIOTECH CORPORATION ANNOUNCES MANAGEMENT
WORCESTER, Mass., March 25, 1996 -- Cambridge Biotech Corporation (CBC) announced
today that Stephen J. DiPalma has been appointed to the positions of Vice President of Finance,
Treasurer and Chief Financial Officer and Eileen J. Heffernan has been appointed to the position of
Director of Product Management and Business Development. Mr. DiPalma joins CBC from the
Picker Institute, an affiliate of Beth Israel Hospital in Boston, where he was Chief Financial Officer
and Chief Operating Officer. Ms. Heffernan joins CBC from Athena Diagnostics, Inc., where she
was Manager, Diagnostic Licensing.
"Mr. DiPalma brings to CBC thirteen years of experience in healthcare ventures, including the
Picker Institute and Genica Pharmaceutical Corporation. Ms. Heffernan brings five years of
business development experience with Athena Diagnostics, Inc. and Genica Pharmaceutical
Corporation," remarked Alison Taunton-Rigby, Ph.D., President and Chief Executive Officer of
CBC. "Together, their broad base of knowledge will allow them to make significant and immediate
contributions to Cambridge Biotech Corporation as the Company builds its therapeutic business."
While at the Picker Institute, which specializes in quality assessment, improvement and information
services, Mr. DiPalma's responsibilities included finance and accounting, information systems,
business development and marketing. Previously, Mr. DiPalma was Chief Financial Officer of
Genica Pharmaceutical Corporation, a biotechnology company focused on therapeutic
development and innovative diagnostic testing targeted at neurological disorders. Mr. DiPalma
received his M.B.A. from Babson College.
While at Athena Diagnostics, the division of Athena Neurosciences, Inc. formed as a result of its
acquisition of Genica in 1995, Ms. Heffernan held a number of business development positions,
most recently Manager, Diagnostic Licensing. Prior to Athena Diagnostics, Ms. Heffernan was a
research assistant at the University of Connecticut where, in addition, she received her B.A. degree
Cambridge Biotech Corporation, which filed for protection under Chapter 11 of the United States
Bankruptcy Code on July 7, 1994, is a therapeutics and diagnostics company focusing on
infectious disease and cancer. The company is developing and commercializing therapeutic and
prophylactic vaccines for infectious diseases and immunotherapeutics for cancer. The company's
therapeutics business includes the Stimulon(TM) family of adjuvants, the most advanced of which,
QS-21, is in clinical development through corporate and academic partners, and proprietary
vaccines. The proprietary vaccines include a feline leukemia vaccine currently on the market and
vaccines in development in the areas of tick- borne diseases, streptococcal pneumonia, malaria,
bovine mastitis and canine Lyme disease. Cambridge Biotech's diagnostic business is primarily
focused on retroviral, Lyme and enteric diseases.
CONTACT: Alison Taunton-Rigby, Ph.D., President and Chief Executive Officer of Cambridge
Biotech Corporation, 508-797-5777, or Robert Gottlieb, Senior Vice President of Feinstein
Partners Inc., 617-577-8110
All For A Dollar announces year-end results
SPRINGFIELD, Mass. -- March 25, 1996 -- All For A Dollar Inc. (OTC:AFAD), today
announced sales and earnings for the fourth quarter and fiscal year ended Dec. 30, 1995.
Sales for the fourth quarter decreased 4.7 percent to $17.0 million from $17.8 million in the
corresponding period in 1994, primarily as a result of unusually inclement December weather.
Same store sales declined 5.6 percent for the quarter. During the 1995 fourth quarter the company
opened five new stores. Income before reorganization items and income taxes for the fourth quarter
was $1.6 million, compared to $1.3 million in the corresponding period in 1994. The net income
for the quarter was $4.4 million, or $.63 per share, primarily as a result of recording a $2.6 million
income tax benefit for net operating loss carryforwards, compared to a net loss of $944,000, or
$.14 per share, in the corresponding period in 1994.
Sales for the fiscal year ended Dec. 30, 1995 decreased 14.2 percent to $47.3 million from $55.2
million in 1994. Same store sales increased 1.1 percent for the year. The loss before reorganization
items and income taxes for the year was $894,000, compared to a loss of $4.6 million in 1994.
The net income for the year was $8.3 million, or $1.19 per share, compared to a net loss of $12.4
million, or $1.78 per share for 1994.
The company also announced that it has sublet or assumed eight store leases from Rich's $1, $2,
$3 stores effective March 1, 1996. All For A Dollar presently operates 122 retail close-out variety
stores in nine northeastern states. Additionally, the company will add two new stores to the
Rochester, N.Y. market in April.
The company also announced the employment of Joseph B. Carey of Wilbraham, Mass. to serve
CONTACT: All For A Dollar Donald A. Molta, 413/733-1203
Cray Computer approves disclosure statement with respect to company's liquidating Plan of
COLORADO SPRINGS, Colo. -- March 25, 1996 -- Cray Computer Corp. Monday
announced that the United States Bankruptcy Court has approved the Disclosure Statement filed
by Cray Computer Corp. with respect to the company's liquidating Plan of Reorganization and set
the hearing to consider confirmation of the plan for May 15, 1996.
The plan proposes the appointment of a Liquidating Trustee and the sale of the company's plant to
M/A-COM Inc. for a price of $7.3 million (subject to an opportunity for competitive bidding), to
be closed immediately following confirmation of the plan.
Because the claims of creditors exceed the assets of Cray Computer Corp., the company believes
that there will be no distribution to its shareholders.
Early in 1995, and continuing after it filed for bankruptcy on March 24, 1995, the management of
the company sought to reorganize and continue in business. By mid-July, it became apparent that
this would not be possible because no other company would risk the substantial capital necessary
to complete and market the CRAY-4 supercomputer.
The company then began to liquidate assets at the best obtainable prices. It has now completed the
sale of all major assets other than its plant. Following confirmation of the plan and the closing of the
sale of the plant, only the resolution of some disputed claims will remain.
Terry A. Willkom, president of Cray Computer, said, "We are very sorry that we were unable to
find the capital necessary to complete the CRAY-4 and stay in business. Once we reluctantly
reached that conclusion, our only course was to obtain the best possible values for the company's
assets under these difficult circumstances.
"We are satisfied that we have nearly completed that task, but sorry that it has not produced
enough money to allow a distribution to our many loyal shareholders."
CONTACT: Cray Computer Corp., Colorado Springs Terry A. Willkom, 719/579-6464
General Acceptance Corp. reports fourth quarter earnings; enters into forbearance agreement with
BLOOMINGTON, Ind. -- March 25, 1996 -- General Acceptance Corp. today reported its
earnings for the fourth quarter and calendar year 1995.
Pro forma net income for the year ended Dec. 31, 1995 was $716,700 vs. pro forma net income
of $2,544,100 for 1994. As the company was an S Corporation until April, 1995, net income has
been adjusted to reflect pro forma income taxes. Pro forma net income per share was 13 cents for
1995 vs. 57 cents for 1994.
The company reported a pro forma loss of $3,109,600 for the fourth quarter of 1995 vs. pro
forma earnings of $722,500 for the same three months of 1994. This equates to (51 cents) per
share and 16 cents per share for the fourth quarters of 1995 and 1994 respectively. During the
fourth quarter of 1995, the company recorded a provision for credit losses of $6.2 million vs.
$104,000 in the fourth quarter of 1994. This action resulted in an increase in the company's total
available for credit losses to 16.5% of contracts receivable as of Dec. 31, 1995, compared to
14.2% as of Dec. 31, 1994.
Revenues for the year were $25.6 million vs. $10.6 million for 1994, an increase of 142%.
Revenues for the three months ended Dec. 31, 1995 were $6.9 million compared to $3.8 million
for the fourth quarter of 1994, an increase of 82%. Contracts receivable were $129.4 million as of
Dec. 31, 1995 vs. $62.1 million as of Dec. 31, 1994, an increase of 108%.
General Acceptance Corp. also announced that it entered into a forbearance agreement with its
primary lender, whereby the lender agreed to forbear from exercising certain rights and remedies
under its loan agreement with the company through June 30, 1996. As previously announced, on
Jan. 17, 1996, the company was notified of an event of default regarding certain performance
covenants under its loan agreement. Pursuant to the forbearance agreement, the lender will continue
funding the company under its $100.0 million revolving line of credit. During the period from March
15, 1996 through June 30, 1996, the interest rate under the loan agreement will increase by 1%.
The forbearance agreement sets revised covenants related to delinquency and credit losses through
June, requires lender approval prior to opening any additional company branch offices and requires
the company to maintain the credit underwriting standards which it implemented in January, 1996.
In addition, the company announced it has developed an action plan, acceptable to the lender,
which is designed to reduce delinquencies and credit losses, and requires the company to expedite
the ongoing development of the company's infrastructure. The company intends to hire additional
management personnel, continue to upgrade its management information systems and internal
underwriting controls and to increase training on the Norwest System. While continuing to build the
infrastructure, the company, plans to maintain contracts receivable near the 1995 year-end level
through the first six months of 1996.
Upon General Acceptance Corp.'s satisfactory performance of the action plan and compliance with
the forbearance agreement, on or before July 1, 1996, General Acceptance Corp. and its lender
have agreed to execute amended and restated loan documentation, mutually satisfactory in all
respects to both parties. In the event that new loan documentation is not completed by July 1,
1996, the parties have agreed that the forbearance agreement will remain in effect through
December 31, 1996, except that the imposition of the extra 1% interest will cease as of June 30,
General Acceptance Corp. is a specialized consumer finance company, principally, engaged in
purchasing and servicing installment sale contracts, relating to the sale of used automobiles, to
consumers with limited access to traditional financing sources. The company acquires these
contracts from dealers with whom the company has a formal business relationship and, to a lesser
extent, from used vehicle sales outlets operated by the company. The company operates in 19
states, is headquartered in Bloomington, and has regional offices in Ohio, Illinois, Florida, Missouri,
New Jersey, Pennsylvania, Arizona and Michigan.
CONTACT: General Acceptance Corp., Bloomington Martin Bozarth, 812/876-3555