Ugly Duckling Corp. To Provide "Debtor in
Possession" Financing to First Merchants
PHOENIX, AZ--July 11, 1997--Ugly Duckling Corp.
(NASDAQ/NM:UGLY) Friday announced that it has entered into an
agreement with First
Merchants Acceptance Corp. (NASDAQ/NM:FMAC) to provide
"debtor in possession" financing to FMAC in an amount
up to $10 million.
Advances to FMAC under this agreement are subject to certain
conditions, including, but not limited to, entry by the
Bankruptcy Court of an order acceptable to Ugly Duckling.
FMAC earlier Friday filed a petition for reorganization under
Chapter 11 of the Bankruptcy Code and will be acting as the
debtor in possession in its bankruptcy.
With headquarters in Phoenix, Ugly Duckling operates the
largest publicly held chain of "buy here pay here" used
car dealerships in the United States and underwrites, finances
and services retail installment contracts generated from the sale
of used cars by its dealerships and by third-party used car
dealerships located in selected markets throughout the country.
-0- NOTE TO EDITORS: This news release includes statements that
may constitute forward-looking statements, usually containing the
words "believe," "estimate,"
"project," "expect" or similar expressions.
These statements are made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements inherently involve risks and
uncertainties that would cause actual results to differ
materially from the forward-looking statements. By making these
forward- looking statements, the company undertakes no obligation
to update these statements for revisions or changes after the
date of this release. Factors that could cause or contribute to
such differences include, but are not limited to, factors
detailed in the section titled "Risk Factors" in the
company's Prospectus, dated June 24, 1997, in the sections titled
"Factors That May Affect Future Stock Performance" and
elsewhere in the company's most recent reports on Form 10 K/A and
Form 10-Q, and in Ugly Duckling Corp.'s other Securities and
Exchange Commission filings.
CONTACT: Ugly Duckling Corp., Phoenix Steven T. Darak,
602/852-6600 or Silverman Heller Associates, Los Angeles Eugene
G. Heller/Lori C. Parks, 310/208-2550
Flagstar Files Voluntary Chapter 11
Plan, Entering Final Stage of Restructuring Process
SPARTANBURG, S.C.--July 11, 1997--href="chap11.flagstar.html">Flagstar Companies, Inc.
(OTC:FLST) today announced that it has commenced the final stage
of the approval process for its financial restructuring by filing
its plan with the U.S. Bankruptcy Court in South Carolina. The
company's "pre-packaged" plan has already been
overwhelmingly approved by creditors in a consent solicitation
which concluded earlier this week. The plan must now be approved
by the U.S. Bankruptcy Court as part of a Chapter 11 proceeding
before it can be implemented.
The Chapter 11 proceeding only involves Flagstar Companies,
Inc., the parent company, and its corporate subsidiaries,
Flagstar Corporation and Flagstar Holdings, Inc. The subsidiaries
that operate the company's restaurants are not affected in any
way and will continue to operate in the normal course outside of
the context of the bankruptcy proceeding. Flagstar expects parent
company operations to continue as usual.
The company noted that it enters its Chapter 11 proceeding
with an agreement for a $200 million debtor-in-possession
revolving credit facility from The Chase Manhattan Bank. Flagstar
also has a written commitment from Chase for a $200 million
senior secured revolving credit facility that will refinance the
debtor-in- possession facility upon the company's emergence from
Chapter 11, to be used for working capital advances and letters
"This step moves us closer to the final approval and
completion of a restructuring process that will enable us to shed
approximately $1.1 billion in debt and preferred stock and
establish a capital structure for our company that will help us
resume a course of growth and profitability," said James B.
Adamson, chairman and chief executive officer of Flagstar.
"We enter this process with the enthusiastic support of all
but our smallest class of debtholders, sufficient liquidity from
our operations and the bank financing we have arranged. Most
importantly, our many fine restaurant brands will be the
foundation of our success when we emerge from Chapter 11. We also
have an employee base that is one of the finest in the industry,
which will enable us to achieve our strategic goals once the
restructuring process is completed."
Flagstar is one of the nation's largest restaurant companies,
with over 3,200 moderately-priced restaurants and annual revenue
of approximately $2.7 billion. Flagstar owns and operates the
Carrows, Coco's, Denny's, El Pollo Loco and Quincy's Family
Steakhouse restaurant brands and is the largest franchisee of
CONTACT: Flagstar Companies Inc. Investor Contact: Larry
Gosnell, 864/597-8658 Media Contact: Karen Randall, 864/597-8440
Harrah's Jazz Company Updates Status
New Orleans, LA - July 11, 1997 - href="chap11.harrahs.html">Harrah's Jazz Company
("HJC") announced today that Harrah's Entertainment,
Inc. ("HET") (NYSE: HET) has notified HJC that, at this
time, HET is not prepared to commit to extend debtor in
possession financing beyond the earlier to occur of September 30,
1997, and its provision of a total of $30 million in such
financing. HET has already loaned HJC in excess of $24 million of
the $30 million in debtor in possession financing currently
authorized by the bankruptcy court. HET said that it provided its
notice to HJC at this time to afford HJC the opportunity to
explore its alternatives.
HJC believes that if it is unable to obtain debtor in
possession financing beyond such date or such amount, its ability
to consummate its plan of reorganization, and resume construction
of and open the land-based casino may be materially impaired.
Following the failure of the Louisiana Legislature to approve
the terms of an amended casino operating contract last month, HJC
filed with the bankruptcy court a proposal to modify its plan of
reorganization to seek to assume its existing casino operating
SOURCE Harrah's Jazz Company -0- 7/11/97 /CONTACT: William
Patrick, Harrah's Jazz Company, 504-533-6000/
First Merchants Seeks Chapter 11
DEERFIELD, Ill.--July 11, 1997--href="chap11.firstmerchants.html">First Merchants Acceptance
Corp. (NASDAQ:FMACE) announced that it filed a petition today
in the United States Bankruptcy Court in Delaware for protection
under Chapter 11 of the Bankruptcy Code.
Earlier this week, First Merchants announced that it was in
default under its loan agreement with its bank group, as well as
under the Indentures that govern two series of subordinated notes
which it issued. The company had also earlier announced that the
bank group had ceased honoring its checks, and indicated that it
might seek Bankruptcy Code protection.
The company has negotiated a debtor in possession financing
facility with Ugly Duckling Corp. which will be presented early
next week for Bankruptcy Court approval.
William Plamondon, First Merchants' president and CEO, stated
that he was "pleased with the new financing" because it
"provides a meaningful opportunity to reorganize, including
the resumption of contract purchases." Plamondon is part of
a new management team brought in last April after the company
dismissed certain prior executive officers following the
discovery of irregularities involving unauthorized entries in its
First Merchants is a national specialty finance company,
primarily engaged in financing the purchase of used automobiles
by consumers who have limited access to traditional sources of
credit. The company acquires dealer-originated retail installment
contracts from franchised and independent automobile dealers and
financial institutions in 37 states.
Safe Harbor Language
This press release contains various forward-looking statements
and information that are based on management's beliefs as well as
assumptions made by and information currently available to
management, including statements regarding future economic
performance and financial condition, liquidity and capital
resources, and management's plans and objectives. Such statements
are subject to various risks and uncertainties which could cause
actual results to vary materially from those stated. Should one
or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary
materially from those anticipated, estimated, expected or
projected. Such risks and uncertainties include the availability
of financing on terms and conditions acceptable to the company,
the ability of the company to securitize its finance contracts in
the asset-backed securities market on terms and conditions
acceptable to the company and changes in the quality or
composition of the serviced finance contract receivable
portfolio. Certain of these as well as other risks and
uncertainties are described in more detail in the company's
Annual Report on Form 10-K, as amended for the period ended Dec.
31, 1996. The company undertakes no obligation to update any such
factor or to publicly announce the result of any revisions to any
of the forward-looking statements contained herein to reflect
future events or developments.
CONTACT: Amen & Associates, New York Larry Parnell,
212/448-4257 or First Merchants, Deerfield Norman Smagley,
Montgomery Ward Receives Approval
From U.S. Bankruptcy Court For Severance Payments
CHICAGO, IL - July 11, 1997 - href="chap11.montgomeryward.html">Montgomery Ward & Co.,
Incorporated today received approval from the U.S. Bankruptcy
Court to pay severance and non- qualified supplemental pension
benefits for most former employees. A few senior level former
employees were excluded by the Company from the relief obtained
from the court today.
The approved checks will be immediately processed and mailed
to the affected individuals within days.
"We felt a moral obligation to fight for approval to make
these payments," Roger V. Goddu, chairman and chief
executive officer, said. "Although it is not common for
these payments to be made in a Chapter 11 filing, especially this
early in the process, it was the right thing to do. We are very
pleased that the court agreed with us that these obligations
should satisfied now in the ordinary course."
All normal payroll and benefits for current employees were
approved by the court on Monday, July 7, 1997, when the filing
occurred. Today's ruling affects approximately 500 former
employees who were caught in the timing of the filing. Qualified
pension funds that are held in a fully funded trust are not
impacted by the Chapter 11 filing.
Montgomery Ward, the largest privately held retailer in the
United States, operates a chain of 400 stores in 43 states.
SOURCE Montgomery Ward & Co., Incorporated /CONTACT: Judy
L. Gustafson, Director-Corporate Communications/Training and
Development of Montgomery Ward, 312-467-2025 or fax: 312-467-
MONTGOMERYsize="3"> WARD BANKRUPTCY NEWS
Issue Number 2
Copyright 1997 (ISSN XXXX-XXXX) July 11, 1997
Bankruptcy Creditors' Service, Inc., Phone
609-392-0900 FAX 609-392-0040
BANKRUPTCY NEWS is published by Bankruptcy Creditors' Service,
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IN THIS ISSUE -------------
 SUMMARY OF ASSETS & LIABILITIES REPORTED IN THE
 LIST OF THE DEBTORS' 20 LARGEST UNSECURED CREDITORS
 DEBTORS' MOTION FOR EXTENSION TO FILE SCHEDULES &
 DEBTORS' APPLICATION TO EMPLOY JONES DAY AS LEAD COUNSEL
 DEBTORS' APPLICATION TO EMPLOY RICHARDS LAYTON AS LOCAL
 DEBTORS' APPLICATION TO EMPLOY ALTHEIMER AS CORPORATE
 DEBTORS' APPLICATION TO EMPLOY ERNST & YOUNG AS
 DEBTORS' MOTION FOR APPROVAL OF $1 BILLION DIP FINANCING
 DEBTORS' MOTION FOR CONTINUATION OF MWCC CREDIT CARD
 U.S. TRUSTEE SCHEDULES MEETING TO FORM OFFICIAL
 DEBTORS' MOTION TO HONOR PREPETITION CUSTOMER OBLIGATIONS
 DEBTORS' MOTION TO PAY AND HONOR PREPETITION EMPLOYEE
 DEBTORS' MOTION TO PAY PREPETITION CLAIMS OF DEPARTMENT
 DEBTORS' MOTION TO PAY CLAIMS OF VITAL SERVICE PROVIDERS
 DEBTORS' MOTION TO PAY PREPETITION CUSTOMS DUTIES &
 DEBTORS' MOTION TO CONTINUE WORKERS' COMPENSATION
 DEBTORS' MOTION TO PAY CERTAIN PREPETITION CONTRACTOR
 DEBTORS' MOTION TO PAY PREPETITION TRUST FUND TAXES
 CORPORATE ORGANIZATIONAL CHART BASED ON DEBTORS' FIRST
KEY DATE CALENDAR -----------------
07/07/97 Petition Date 07/18/97 Organization Meeting of
Creditors in Wilmington, Delaware
07/28/97 Deadline to provide Utility Companies with adequate
07/25/97 Deadline for Objections to DIP Financing and PLCC
07/31/97 Hearing on Debtors' DIP Financing Motion
07/31/97 Hearing on Debtors' Motion to Continue PLCC Program
09/05/97 Deadline to assume or reject leases and executory
09/22/97 Deadline for filing Schedules of Assets and Liabilities
9/22/97 Deadline for filing Statement of Financial Affairs
09/22/97 Deadline for filing List of Leases and Executory
10/06/97 Deadline for removal of actions pursuant to F.R.B.P.
11/04/97 Expiration of Debtors' Exclusive Period to propose a
01/03/98 Expiration of Debtors' Exclusive Solicitation Period
07/07/99 Deadline for Debtors' Commencement of Avoidance Actions
<None> Bar Date for filing Proofs of Claim
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Securities Fraud Class Action Commenced Against name="STREAMLOGIC">Streamlogic Corporation Insiders
LOS ANGELES, CA - July 11, 1997 - On July 7, 1997, a
securities fraud class action was commenced in the United States
District Court for the Central District of California entitled,
"Donald Schnittka, Carol & Carl Bishop, Jt. Tens., and
Bonnie Ho v. J. Larry Smart, Barbara Scherer and Lee
Hilbert," Civ. No. 97-4922- WDK (CWx), on behalf of those
investors who purchased the common stock of Streamlogic
Corporation ("Streamlogic" or "the Company")
during the period between May 7, 1996 and Nov. 21, 1996,
inclusive ("the Class Period").
The complaint charges the Defendants, all of whom were
prominent officers and/or directors of Streamlogic, with
manipulating the price of Streamlogic common stock through a
series of material misrepresentations and omissions regarding the
Company's ability to finance efforts to develop new products and
lines of business, particularly in relation to the Company's
joint development efforts with Sattel Communications, Inc., when
in fact: 1) due to continuing operating losses and pressing
financial commitments, Streamlogic was in no financial position
to fund any new development efforts; and 2) Sattel Communications
had dated technologies and no research and development
capabilities. The Complaint alleges that these misrepresentations
and omissions had the effect of misleading the public, thereby
artificially inflating the price of Streamlogic stock. Plaintiffs
are seeking redress for all investors who purchased Streamlogic
stock during the Class Period and suffered damages as a
Streamlogic's stock was traded on the Nasdaq National Stock
Market until June 25, 1997, when it was delisted. The following
day, June 26, 1997, the Company filed for protection under
Chapter 11 of the federal bankruptcy laws.
Plaintiffs are represented by the law firms of Finkelstein,
Thompson & Loughran, Goodkind Labaton Rudoff & Sucharow
LLP, and Krause & Kalfayan. These firms have broad experience
in representing defrauded investors in shareholder class actions,
and have over 30 years of securities litigation experience in
federal and state courts throughout the United States.
If you are a member of the Class described above, and if you
meet certain other legal requirements, you may, not later than 60
days from today, move the Court to serve as a lead plaintiff. If
you wish to discuss this action or have any questions concerning
this notice or your rights or interests, please contact Burton H.
Finkelstein or Donald J. Enright with Finkelstein, Thompson &
Loughran, at 202-337-8000; Jonathan Plasse with Goodkind Labaton
Rudoff & Sucharow LLP, at 212-907-0700; or Patrick Keegan
with Krause & Kalfayan, at 619-232-0331.
SOURCE Finkelstein, Thompson & Loughran /CONTACT: Burton
H. Finkelstein or Donald J. Enright of Finkelstein, Thompson
& Loughran, 202-337-8000; Jonathan Plasse of Goodkind Labaton
Rudoff & Sucharow LLP, 212-907-0700; or Patrick Keegan of
Krause & Kalfayan, 619-232-0331/