Bankruptcy and Troubled Company News

August 30, 1996

  1. Jay Jacobs Inc. reports second quarter results
  2. Clothestime announces second quarter financial results
  3. North Atlantic Technologies Reports 2nd Quarter Results

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Jay Jacobs Inc. reports second quarter results


            SEATTLE, WA  --  Aug. 30, 1996  --  Jay Jacobs Inc. (JAYJ)
        today reported results for its second quarter ended July 27, 1996.  

            Sales for the second quarter were $16,472,000 compared to
        $18,799,000 for the same quarter last year.  Total sales declined by
        12 percent as a result of a 15 percent decline in store count during
        the second quarter.  During the quarter the company's same store
        sales increased 1 percent.

            The company reported a loss of $653,000, or 11 cents per share,
        compared to a loss of $589,000, or 10 cents per share, for the
        second quarter of last year.  

            Sales for the first six months ended July 27, 1996, were
        $30,297,000 compared to $35,904,000 for the same period last year.
        During the first half, comparable store sales decreased by 3

            The company reported a loss of $2,450,000, or 40 cents per
        share, compared to a loss of $2,577,000, or 44 cents per share, for
        the first half of last year.

            As a result of the decline in sales, primarily related to the
        first quarter, the company's liquidity is under pressure.  This is
        hampering the company's ability to fund ongoing operations and plans
        for expansion have been put on hold.  The company is currently
        seeking additional sources of capital to strengthen its working
        capital position.

            Jay Jacobs Inc. is a Seattle-based specialty apparel retailer
        selling to men and women, currently operating through its 132 stores
        located in 21 states.  During the first six months ended July 27,
        1996, the company opened 15 stores and closed 19 stores.

                        JAY JACOBS INC. AND SUBSIDIARIES
                           Consolidated Balance Sheet
                          (Dollar amounts in thousands)
                                      July 27, 1996
        Current assets:   
         Cash and cash equivalents            $   177
         Accounts receivable                      505
         Inventories                            6,660
         Prepaid expenses                         287
           Total current assets                 7,629
        Property and equipment, net             5,962
           Total assets                       $13,591
        Liabilities and Shareholders' Equity
        Current Liabilities:
         Accounts payable                     $ 5,493
         Accrued payroll                            0
         Accrued restructuring expenses         2,725
         Other accrued expenses                   849
         Short Term Bank Debt                   2,217
           Total current liabilities           11,284
        Deferred rental credits                   618
        Accrued reorganization liability          735
        Shareholders' equity:
         Common stock                          12,991
         Retained earnings                    (12,037)
         Total shareholders' equity               954
           Total liabilities and shareholders'
        equity                            $13,591
                        JAY JACOBS INC. AND SUBSIDIARIES
                      Consolidated Statement of Operations
                          (Dollar amounts in thousands)
                                         Three months ended
                                     Jul 27, 1996  Jul 29, 1995
        Net sales                          $ 16,472      $ 18,799
        Operating costs and expenses:
         Cost of sales, buying and
          occupancy costs                    12,987        14,300
        Selling, general and
         administrative expenses              4,060         5,178
        Interest expense and other
         income, net                             78           (90)
        Net operating expenses               17,125        19,388
        Income (loss) before income
         taxes                                 (653)         (589)
        Earnings (loss) per share         (11 cents)    (10 cents)
        Weighted average number of
         shares outstanding                   6,095         6,007
                                          Six months ended
                                     Jul 27, 1996  Jul 29, 1995
        Net sales                          $ 30,296      $ 35,904
        Operating costs and expenses:
         Cost of sales, buying and
          occupancy costs                    23,988        28,246
        Selling, general and
         administrative expenses              8,699        10,393
        Interest expense and other
         income, net                             59          (158)
        Net operating expenses               32,746        38,481
        Income (loss) before income
         taxes                               (2,450)       (2,577)
        Earnings (loss) per share         (40 cents)    (44 cents)
        Weighted average number of
         shares outstanding                   6,079         6,007

        CONTACT:  Jay Jacobs Inc.
                  Bill Lawrence, 206/622-5400 ext. 217

Clothestime announces second quarter financial results


            ANAHEIM, Calif.  --  Aug. 30, 1996  --  The Clothestime
(OTC:CTMEQ) on Friday announced results for the second quarter
        ended July 27, 1996.

            Sales for the quarter were $59.5 million compared with $89.3
        million last year.  A significant portion of the total sales
        reduction was due to the lower number of stores this year as
        compared with last year.  For the first six months of fiscal 1996,
        total sales were $103.2 million compared with $161.6 million for the
        first six months of last year.  

        Currently, there are 364 stores as compared with 554 stores last year.

            Operating income for the quarter before reorganization charges
        was $82 thousand as compared with a loss of $462 thousand for the
        same period last year.  There was no income tax benefit this year
        compared with an income tax benefit of $14 thousand last year.

            The loss for the second quarter this year includes
        reorganization costs of $4.3 million, resulting in a net loss of
        $4.2 million.  The loss per share was 30 cents this year vs. a loss
        of 3 cents per share for the same quarter last year.

            For the first six months of fiscal 1996, the operating loss
        before reorganization charges was $4.4 million as compared with a
        loss of $7.6 million for the same period last year.  There was no
        income tax benefit this year compared with an income tax benefit of
        $2.8 million last year.  

            The loss for the six months this year includes reorganization
        costs of $5.6 million, resulting in a net loss of $10.1 million.
        Loss per share was 71 cents this year as compared with 34 cents last

            Clothestime Stores currently operates 364 women's apparel stores
        in 17 states and Puerto Rico, offering primarily in-season,
        moderately-priced sportswear, dresses and accessories, emphasizing
        fashion at a discount from department and specialty stores.

                       The Clothestime Inc.
             Summary Results of Operations (Unaudited)
             (000's Omitted, Except Per Share Amounts)
                          Second Quarter            Six Months Ended
                       7/27/1996   7/29/1995     7/27/1996   7/29/1995
        Net sales           $59,492    $89,282        $103,159   $161,629
         Before Reorganization
          Costs and Income
           Tax Benefits     $    82    $  (462)       $ (4,379)  $ (7,617)
        Net loss            $(4,189)   $  (449)       $(10,041)  $ (4,799)
        Loss per share      $ (0.30)   $ (0.03)       $  (0.71)  $  (0.34)
        Average shares
         outstanding          14,198    14,187          14,198     14,185

        CONTACT:  Clothestime, Anaheim
                  Andrew G. Tepper, 714/779-5881, ext. 2260

North Atlantic Technologies Reports 'Fresh Start' Reporting; Second
Quarter Results


            MINNEAPOLIS, MN  --  Aug. 29, 1996  --  href="chap11.north.html">North Atlantic Technologies,
(OTC: NATT) today reported net income of $157,125 on
        of $1,686,381 for the quarter ended June 30, 1996, compared to a
        loss of $761,207 on revenues of $913,321 for the second quarter of
        1995.  Bruce Watson, the Company's President noted that the loss for
        the period in the previous year included an $184,505 expense for the
        write off of the value of a patent of the Company taken due to the
        uncertainty of the Company's ability to continue in operation at
        that time.  Mr. Watson also noted the Company's balance sheet has
        been substantially restated to reflect the reorganization values of
        the Company's assets in connection with the Company's reorganization
        under Chapter 11 of the United States Bankruptcy Code.

            North Atlantic Technologies manufactures heat recovery systems
        to domestic and international industrial companies for energy
        recovery and environmental control applications.

        CONTACT:  Bruce Watson, President, or Allen Karson, Controller,
        612-888-8553, both of North Atlantic Technologies, Inc.