WASHINGTON -- April 8, 1996 -- A bankruptcy hearing
to consider a plan by bondholders of WE
CARE PROJECTS, Inc. to
reorganize and obtain long-term financing for that corporation will
be held on Tuesday, April 9, 1996. WE CARE is a Washington,
D.C.-area company that cares for profoundly mentally retarded
WE CARE filed Chapter 11 in May, 1995 citing the failure of the
U.S. Government to pay more than $3 million due the company.
Numerous lawsuits against the company and its founder, Charles
Dorsey have prevented long-term financing to date.
The hearing will be held from 9:30 a.m. to approximately 5:00
p.m., April 9, 1996 in the U.S. Bankruptcy Court, 333 Constitution
Avenue N.W., Washington, D.C. The case number is #95-00525. Judge
S. Martin Teel, Jr. will preside.
Michael B. Solow of Hopkins & Sutter is counsel for the
bondholders. He is available for comment at 202/835-8000.
CONTACT: Hopkins & Sutter;
Mike Ralston, 312/558-4254
CHARLOTTE, N.C. -- April 8, 1996 -- href="chap11.pic.html">Pic 'N Pay
Stores, Inc., today announced that the U.S. Bankruptcy Court in
Wilmington, Delaware, has approved a motion allowing the company to
receive up to $25 million in debtor-in-possession (DIP) financing
from Congress Financial Corporation.
The DIP agreement, which was approved by Pic 'N Pay's creditors
committee, will allow the company to immediately borrow up to $20
million for working capital, operating expenses and other purposes.
The DIP facility has a $15 million sublimit for letters of credit
and a provision that could enable the company to borrow an
additional $5 million at a later date. The agreement will expire in
two years or on the effective date of a confirmed plan of
reorganization, whichever occurs first.
"We are very pleased that the court and creditors' committee
have given final approval for our $25 million DIP facility, which
will ensure that Pic 'N Pay can continue to make timely payment to
its vendors and receive merchandise shipments under normal terms,"
said Joseph Gajda, president and chief executive officer of Pic 'N
Pay. "This financing gives us the flexibility we need to execute
our restructuring and restore the company to profitability."
Pic 'N Pay filed a voluntary petition for reorganization under
chapter 11 of the Federal Bankruptcy Code on February 15, 1996.
Since then, the company has implemented actions aimed at restoring
its financial health, including closing underperforming stores
-- with bankruptcy court approval -- and downsizing the
Based in Charlotte, N.C., Pic N' Pay Stores, Inc. is the largest
footwear and accessories retailer in the southeastern United States,
operating stores under the Pic 'N Pay, Shoe World and Shoe City
names. The company is owned by Sussex Holdings, Inc., a New Jersey-
based investor group led by William F. Taggart, a private investor
and turnaround specialist.
CONTACT: Michael Freitag or Todd Fogarty -
Kekst and Company,
SEATTLE, WA -- April 8, 1996 -- MIDCOM Communications
Inc (NASDAQ:MCCI) today reported financial results for the fourth
quarter and year ended Dec. 31, 1995, as well as final restated
results for the third quarter of 1995.
At the same time, the company announced the closing of a $15
million interim credit facility; receipt of a proposal from a lender
to purchase $22.5 million of subordinated notes subject to certain
conditions; a new agreement with one of its network providers; and a
letter of intent for an agreement that would substantially expand
the company's access to switching facilities.
For the year ended Dec. 31, 1995, MIDCOM's revenues rose to
$203.6 million, an 82 percent increase over $111.7 million in 1994.
The net loss in 1995, including charges, write-offs and
extraordinary items as described in this release, totaled $33.4
million, or $2.76 per share, compared to a net loss of $3.0 million,
or $0.31 per share, in 1994. Net losses, exclusive of write-offs
and extraordinary items, totaled $17.5 million, or $1.45 per share.
"We are obviously disappointed with these losses, but believe it
is prudent to put these write-offs behind us," said Ashok Rao,
president and chief executive officer. "The revenue growth resulted
from acquisitions made during the year and from sales by the
company's combined sales channels," he added.
Gross profit in 1995 (including aggregation fees) grew to $64.0
million, or 31.4 percent of revenues, up from $32.7 million, or 29.2
percent of revenues, in 1994. The margin on telecommunications
services (exclusive of aggregation fees) grew to 30.8 percent of
revenues in 1995 from 25.2 percent of revenues in 1994, reflecting
the acquisition of higher margin customer bases and businesses
during 1995, a higher percentage of traffic on company-owned
switches and lower pricing from some of the company's interexchange
Selling, general and administration expenses (SG&A) increased to
30.5 percent of revenues in 1995, or $62.1 million, from 24.8
percent of revenues in 1994. EBITDA (operating income plus
depreciation and amortization and loss on impairment of assets) for
1995 was $1.9 million, down from $5.0 million in 1994, primarily due
to the increase in SG&A. The increase in SG&A includes a
substantial increase in reserves for bad debt expense largely
attributable to billing delays incurred while converting to the new
billing system. SG&A increases also include costs incurred to
maintain duplicate billing and information system, including those
of acquired businesses and costs related to expanding the company's
"We believe we have made significant strides in eliminating the
delays in billing which impacted our operations in 1995," said Rao.
"We are also taking action to reduce our SG&A and have restructured
operations to lower costs. In March, we reduced our workforce by 82
people by consolidating a number of job functions," he added. These
changes are expected to result in a restructuring charge of
approximately $1.3 million in the first quarter of 1996 and
annualized savings of up to $4.0 million.
The 1995 results include non-cash write-offs, totaling
approximately $11.8 million, consisting of $6.8 million related to
MIDCOM's long distance joint venture in Russia; $2.5 million related
to a write-off of its current switching equipment as a result of its
decision to migrate to AT&T No. 5ESS-based switching platforms
(referred to later in this press release); and $2.5 million related
to a partial write-down of its capitalized software for its
management information system. Commencing January 1, 1996, the
company will no longer capitalize software development expenditures
related to its existing billing system, but, rather will expense
them in the period in which they are incurred. MIDCOM is also
actively seeking to sell its interest in its Russian joint venture,
Dal Telecom, that operates a local, cellular and long distance
telephone network in the Russian Far East. Rao said that MIDCOM
will focus all of its efforts on its domestic business.
"Our 1995 results also include $4.1 million in non-cash
extraordinary items related to the early payoff of subordinated
notes and senior debt in the third and fourth quarters," Rao
explained. These charges accounted for $0.34 of total loss of $2.76
For fourth quarter, MIDCOM's revenues rose to $56.1 million,
approximately an 81 percent increase over 1994's fourth quarter.
Higher operating and interest expenses, coupled with $12.9 million
in write-offs (loss on impairment of assets) and extraordinary
items, resulted in a fourth quarter 1995 loss of $21.5 million, or
$1.40 per share, compared to a loss of $2.6 million in the fourth
quarter of 1994, or $0.26 per share. The company has filed an
amendment to its quarterly report on Form 10-Q for the quarter ended
Sept. 30, 1995 reporting restated third quarter 1995 revenues and
net loss of $48.2 million and $8.3 million, respectively.
The company's 1995 Annual Report on Form 10-K will be filed upon
completion of the year-end audit. The company filed a Form 12b-25
with the Securities and Exchange Commission on April 2, 1996 to
extend the due date of the company's 1995 Form 10-K until mid-April.
The 1995 Form 10-K will reflect the inclusion of two entities
acquired in pooling of interest transactions during 1995.
MIDCOM Announces New Financing
MIDCOM has supplemented its working capital with a $15 million
interim credit facility from Transamerica Business Credit
Corporation and Nations Bank, its senior lenders. Borrowings under
this facility are due in September 1996.
"We are pleased with this support from our lenders and the
availability of this additional working capital," said Rao. "This
has allowed us to meet our short and medium term cash needs and
focus our energies on building the business."
The company has also received a proposal for the purchase of
senior subordinated secured notes in the amount of $22.5 million
from a major investment firm. Closing would occur subject to
completion of documentation and compliance with certain other
conditions. A portion of the proceeds from the notes would be used
to pay down the interim credit facility.
With regard to the company's previously announced effort to
explore a variety of alternatives to maximize shareholder value, Rao
stated, "We have engaged Donaldson Lufkin Jenrette and The Robinson
Humphrey Company as our financial advisors, to investigate possible
MIDCOM Announces New Agreements for Network Services and Expansion
The company has entered into a new network services agreement
with one of its principal carriers and has proposals from the two
other carriers, which collectively would provide MIDCOM with lower
network costs and reduced commitments.
The company has also entered into a letter of intent with US ONE
Communications Corporation whereby the company would have access to
a nationwide network of high capacity switches. US ONE has placed
orders for a number of AT&T No. 5ESS-2000 switches which it expects
to install in stages commencing later this year. Under the terms of
this letter of intent, US ONE would provide MIDCOM with both long
distance origination and local dial tone service which the company
believes will enable it to increase its gross margins as it
originates and terminates a higher percentage of its traffic on US
"We are excited about the prospect of being able to originate
and terminate both long distance and local dial tone service on the
proposed US ONE network," said Rao.
Statements in this news release concerning estimates of results,
corrections of billing delays, future performance, cost reductions,
margin improvements and anticipated financing or carrier
arrangements constitute forward-looking statements which are subject
to a number of risks and uncertainties which may cause actual
results or events to differ materially from stated expectations.
These risks and uncertainties include final audit results, including
possible additional write-downs or adjustments, further information
systems difficulties, unanticipated expenses, unavailability of
additional working capital, uncertainty of closing conditions,
competitive conditions and other risks including those described
from time to time in the company's filings with the Securities and
Exchange Commission, press releases and other communications.
Founded in 1989, MIDCOM Communications Inc. provides a broad
range of telecommunications services to small- and medium-sized
businesses nationwide. The company is headquartered in Seattle,
Washington and has regional offices throughout the nation. MIDCOM
currently serves more than 150,000 customers.
CONTACT: MIDCOM Communications Inc.;
Ashok Rao, 206/628-8383 or
George Rebensdorf, 206/628-4394
DETROIT, MI -- April 8, 1996 -- href="chap11.caribbean.html">Caribbean Telephone &
Telegraph Inc. Monday announced that it has filed for voluntary
reorganization under Chapter 11 of the Bankruptcy Code.
The decision came after a long period of financial problems due
in part to the inability of the company to collect more than $25
million in prepaid phone cards which had been sold to independent
In February TLC had stopped shipping through independent
distributors and had effectively reduced the amount of exposure in
the main markets of New York, Boston, Miami, Houston and Los
Angeles. The decision to reorganize was driven by MCI's decision to
shut down carrier services and TLC's devotion to the best interests
of its customers.
Prior to this shut down, TLC was in the process of redefining
its distribution, pricing and payment policies and was showing
MCI, the largest creditor named in the filing, was TLC's major
long-distance carrier carrying more than 80 percent of the traffic.
The inability of TLC to pay nearly $50 million in services forced
the move to reorganize. It was impossible to restructure the
distribution system into an in-house operation under MCI's payment
demands and the amount of unused phone time still in the hands of
Although recent weeks have seen the disruption of phone service
to nationwide customers of the popular TLC PhoneCard, there is still
a continued interest on the part of both retailers and consumers in
TLC. During the past three years the TLC card has become known as
one of the most trusted and economical calling services available.
A pioneer in the prepaid debit card industry, the TLC PhoneCard
offers local (and intra- and inter-LATA calling), domestic and
international long-distance services from anywhere in the United
President Jim Franklin stated: ``Interest in the TLC PhoneCard
as a product remains very high. We are confident under our
reorganization plan that any damage in the marketplace can be
repaired with improved vendor responsibilities and customer
``We will be able to continue to support consumers seeking
refunds from vendors and independent distributors under this
reorganization. To liquidate the company and walk away from this
responsibility would be devastating to TLC and the industry.''
TLC's current switching equipment capacity has more than 16,000
ports dedicated to pre-paid phone calls. This ensures the consumer
of trouble-free quality access to telephone services. By
reorganizing under Chapter 11 and making arrangements with
additional long-distance carriers, TLC will continue to provide
consistent, quality service to all of its customers.
CONTACT: Doug Dely, 313/202-2000
WORCESTER, Mass., April 8, 1996 - href="chap11.cambridge.html">Cambridge Biotech
Corporation today announced that it has signed an agreement to
its retroviral diagnostic business to bioMerieux Vitek, Inc., for
$6.5 million in cash.
The transaction, which is subject to approval of the Bankruptcy
Court, will be included as part of the plan of reorganization to be
filed by Cambridge under Chapter 11 of the U.S. Bankruptcy Code.
The transaction is expected to close upon confirmation of the
reorganization plan by the Bankruptcy Court, which typically occurs
two to three months after the filing of the reorganization plan.
Under the agreement, bioMerieux will acquire (through the
acquisition of the stock of Cambridge) Cambridge's retroviral
intellectual property, which includes patents and licenses to
manufacture and sell diagnostic screening and confirmatory tests for
HIV- 1, HIV-2, HTLV-I and HTLV-II and Lyme disease. bioMerieux will
also acquire Cambridge's diagnostic manufacturing operations in
Rockville, Maryland, and will enter into a long-term lease from
Cambridge for Cambridge's Rockville manufacturing facilities.
Alison Taunton-Rigby, President and CEO of Cambridge, said,
"This agreement is another step in the execution of the
reorganization of our business and will allow us to focus on our
therapeutic programs. We will continue development and
commercialization of our Stimulon(TM) adjuvants and our therapeutic
and prophylactic vaccines for infectious diseases and cancer."
Philippe Archinard, President of bioMerieux Vitek, said, "This
acquisition will strengthen our position in infectious diseases. It
will especially reinforce our competencies in the field of
retrovirology and Lyme disease and complement our existing
immunoassay product line."
Cambridge is currently negotiating to sell the remainder of its
diagnostics business, which relates principally to enterological
diseases, to a separate buyer. The company's remaining therapeutic
business will be transferred to a new parent company, to be
established as part of the reorganization plan and to be owned by
Cambridge's existing shareholders and creditors.
bioMerieux Vitek is part of bioMerieux, an international
biotechnology group based in Lyon, France, dedicated to in-vitro
diagnostics with a special focus on infectious diseases. bioMerieux
Vitek, located in St. Louis, MO, and Rockland, MA, develops,
manufactures and markets reagents and automated systems designed for
medical analysis as well as for industrial microbiological controls.
The bioMerieux group ranks among the top 10 corporations
worldwide in biological diagnostics and maintains a global
commitment to healthcare with international market accounting for
70% of its business.
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, President and Chief Executive
Officer of Cambridge Biotech Corporation, 508-797-5777, or Philippe
Archinard, President of bioMerieux Vitek, Inc., 314-731-7411, or
Robert Gottlieb, Senior Vice-President of Feinstein Partners,
617-577-8110, or Anne de Chiffreville, V.P. Communication and Public
Relations of bioMerieux S.A., 33-78-87-22-36
FAIRVIEW HEIGHTS, Ill., April 8, 1996 - Zeigler Coal
Holding Company (NYSE: ZEI) and NRG Energy, Inc., the non-regulated
affiliate of Minneapolis-based Northern States Power Company (NYSE:
NSP), confirmed today that they have submitted a joint proposal to
purchase the non- nuclear assets of href="chap11.cajun.html">Cajun Electric Power
Cooperative, Inc. of Baton Rouge, Louisiana.
Cajun Electric filed for Chapter 11 bankruptcy in December 1994.
The Zeigler/NRG proposal was made in response to a request for
proposals from the bankruptcy trustee. Zeigler/NRG has learned that
their submittal was named lead proposal by the bankruptcy trustee.
The trustee today stated that it was his intention to file a plan of
reorganization that incorporates the Zeigler/NRG proposal on April
According to a statement from the Zeigler/NRG team, "While we
are still in the early stages of what may be a lengthy process, we
are delighted to have been selected as the lead proposal for the
purchase of Cajun's assets.
"We believe that our proposal represents the best option for the
trustee to balance the interests of all stakeholders in Cajun's
bankruptcy. These stakeholders include the customers of Cajun and
its member co-ops, the Rural Utilities Service (formerly the Rural
Electrification Administration), the Louisiana Public Service
Commission, the secured and unsecured creditors, owners and
employees of Cajun and other parties. We look forward to working
closely with the trustee to confirm a plan of reorganization that
allows Cajun to emerge from Chapter 11 bankruptcy."
NRG is one of the leading participants in the independent power
generation industry. Established in 1989, and wholly owned by
Northern States Power, NRG is principally engaged in the
acquisition, development and operation of independent power
production and transmission facilities, thermal energy production
and transmission facilities and resource recovery facilities. NRG
has a proven track record in operating, maintaining and owning
interests in large, coal-fired generation facilities.
The Zeigler family of companies is among the largest coal
producers and marketers in the United States, and controls more than
1.3 billion tons of economically recoverable coal reserves,
including 1 billion tons of low sulfur coal. The Zeigler family of
companies currently operates 11 underground and surface coal mining
complexes, located in Illinois, Kentucky, Ohio, West Virginia and
Wyoming, which mine primarily steam coal. In addition, the company
operates two East Coast import/export terminals and a clean coal
technology corporation. A Zeigler subsidiary has supplied more than
90% of the coal provided to Cajun since 1982.
CONTACT: Vic Svec of Zeigler Coal Holding Company, 618-394-2430,
or Mike O'Sullivan of NRG Energy, Inc., 612-373-5408