/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/991008.MBX T R O U B L E D C O M P A N Y R E P O R T E R Friday, October 7, 1999, Vol. 3, No. 195 Headlines ACDC, INC: Disclosure Statement in Support of Liquidation ATC GROUP: Gets OK for Amended Disclosure Statement CENTRAL EUROPEAN: Genesis Asset Managers No Longer Hold Stock CODED COMMUNICATIONS: Trustee Seeks Substantive Consolidation CRIIMI MAE: Seeks Authority To Sell Brick Church Property FILENE'S BASEMENT: Judge Dismisses Attorneys and Advisors FLORIDA COAST PAPER: Taps Rogers, Towers, Bailey, Jones & Gay GREATER SOUTHEAST: Hospital Buys Time on Finding Financing HIGH POINT: Case Summary & 20 Largest Unsecured Creditors INTERSCIENCE COMPUTER: Acquires Camino Systems Inc. MEDPARTNERS: California Medical Association Resolves Impasse MEDPARTNERS: Committee Objects To Exclusivity Extension MERCURY AIR: Preference Actions Filed By Western Pacific MICHAEL PETROLEUM: Restructure Proposal Delivered To Noteholders NORTHWESTERN STEEL: Proposed Restructuring Of $115 Million Debt PARAGON TRADE: Appaloosa Management Owns 4.81% Of Common Stock PHAR-MOR INC: Fiscal Year-End Sales Level, Losses Down PHILIP SERVICES: Plan Of Reorganization Calls For Indenture Issue PHILIP SERVICES: Proposes Up To $60 Million In Senior Notes PHILIP SERVICES: Seeks Extension To File Schedules and Statements PRICHARD ALA: Files Chapter 9 SERVICE MERCHANDISE: Increases Borrowing Capacity STORMEDIA: Taps Special Litigation Counsel TALK AMERICA: Order Approves Asset Purchase Agreement WELLCARE MANAGEMENT: Receives Release of Supervision BOND PRICING FOR WEEK OF October 4, 1999 ********* ACDC, INC: Disclosure Statement in Support of Liquidation --------------------------------------------------------- The debtor, ACDC, Inc. liquidated substantially all of its assets in May 1999. Although this case was filed under chapter 11, the plan proposes the liquidation of all of the debtor's assets and distribution of proceeds among certain creditors in accordance with the absolute priority rule. The overall purposes of the plan are to settle, compromise, or otherwise dispose of certain claims against and interests in the debtor on terms that the debtor believes to be fair and reasonable, and to disburse the proceeds from the sale of the debtor's assets among all creditors asserting Allowed Claims against the debtor. It is anticipated that the plan will pay Allowed Priority Tax Claims in full, and it is also anticipated that the plan will pay approximately 17 cents on the dollar to unsecured creditors whose claims are deemed to be Allowed Claims. It is estimated that tit will take approximately six months to one year for ACDC to consummate the plan upon entry of a Final Confirmation Order. Treatment of Claims Impaired Under the Plan: Class 4a: Babcock & Wilcox; Unsecured Claim in the amount of $951,600. Pursuant to the Asset Purchase Agreement, the purchaser assumed and became responsible for any payment to Babcock & Wilcox on account of such claim. Class 4(b) - All other unsecured claims that become allowed claims: After Distributions have been made on account of all Class 2 and Class 3 claims, holders will receive a pro-rata share of the trust property. Class 5(a) - The Gladish Claim and (b) All other subordinated claims that become allowed claims: Distributions after payment to Classes 2,3, and 4(b). Class 6: All equity interests shall terminate - no distribution. ATC GROUP: Gets OK for Amended Disclosure Statement --------------------------------------------------- The U.S. Bankruptcy Court in Manhattan has approved ATC Group Services Inc.'s amended disclosure statement, according to an Oct. 1 order. In finding that ATC's disclosure statement contained "adequate information" under terms of the U.S. Bankruptcy Code, the court overruled all prior objections to the company's plan. (The Daily Bankruptcy Review and ABI October 7, 1999) CENTRAL EUROPEAN: Genesis Asset Managers No Longer Hold Stock ------------------------------------------------------------- Genesis Asset Managers International Limited reports that it no longer holds any interest in the common stock of Central European Media Enterprises Ltd. CODED COMMUNICATIONS: Trustee Seeks Substantive Consolidation ------------------------------------------------------------- The Chapter 7 Trustee, Michael B. Joseph seeks substantive consolidation of the debtors' Chapter 7 estates. AS a result of such consolidation all intercompany claims by and among the debtors would be eliminated, all assets and all proceeds thereof and all liabilities of the debtors will be combined or treated as though the debtors were merged; any obligation of any of the debtors and all guarantees thereof executed by any of the debtors will be deemed to be one obligation of any of the debtors, and the same will be true of the treatment of claims. The trustee states that substantive consolidation is warranted and appropriate by applying case law standards. CRIIMI MAE: Seeks Authority To Sell Brick Church Property --------------------------------------------------------- The debtors, CRIIMI MAE Inc., et al. seek court authority to take the necessary actions to implement the sale of the Brick Church Property. The property is a commercial lot, motel building and associate personal property in Nashville, Tennessee. Brick Church (a subsidiary) signed a contract for the sale and purchase of the property at a price of $4.3 million to Buyers, Himanshu Patel, Manisha Patel, Prakash N. Shah and Ketki P. Shah. This sale price is the highest amount that Brick Church has been offered for the property since it began its efforts to sell the property in October of 1998. FILENE'S BASEMENT: Judge Dismisses Attorneys and Advisors --------------------------------------------------------- In the Filene's Basement bankruptcy case, Judge Hillman issued a ruling that disqualified the Company's professionals Hale and Dorr and PricewaterhouseCoopers. The court dismissed Filene's Basement Corp.'s legal team and financial advisors because they failed to disclose ties with a rival retailer, Reuters reported. Boston-based Hale & Door LLP and financial consultant PricewaterhouseCoopers failed to "fully disclose" their connections with TAC Group Inc., the parent company of Frugal Fannie's Fashion Warehouse, Hillman said. In his statement, Hillman wrote that he would not tolerate "coy or incomplete disclosures which leave the court to ferret out pertinent information." He ordered Hale & Dorr to return a $435,000 retainer fee to the retailer, which filed for chapter 11 protection on Aug. 23. Sam Gerson, Chairman and CEO of the Company, said in response to this ruling "while we are very disappointed in the outcome, the Company and its management team wishes to reassure our employees, creditors, and business partners that we will move forward expeditiously to continue the progress we have made in reorganizing Filene's Basement. We have nothing but laudatory compliments with regard to the services provided by Hale and Dorr and PricewaterhouseCoopers. We have selected Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. as our bankruptcy counsel, pending approval of the judge and we are in the process of choosing financial advisors. The strategies and action plans that our professionals have set in motion will ensure that the transition to our new attorneys and financial advisors will occur quickly and effectively. We thank Hale and Dorr and PricewaterhouseCoopers for their dedication, commitment and professionalism and their help in making possible the significant progress we have achieved in this Chapter 11 case." FLORIDA COAST PAPER: Taps Rogers, Towers, Bailey, Jones & Gay ------------------------------------------------------------- The debtors , Florida Coast Paper Holding Company LLC and its debtor affiliates seek authority to employ Rogers, Towers, Bailey, Jones & Gay as special employee benefits counsel and special property tax counsel to the debtors. The firm would provide services with regard to ad valorem property tax issues for the debtors. The professionals working on these cases charge hourly rates ranging from $175 to $200 per hour. GREATER SOUTHEAST: Hospital Buys Time on Finding Financing ---------------------------------------------------------- U.S. Bankruptcy Judge S. Martin Teel Jr. has agreed to provide Greater Southeast Community Hospital officials additional time to locate financing to prevent the hospital's liquidation, The Washington Post reported. Judge Teel has scheduled a hearing for Oct. 13 to review any proposals from new business partners. A $24 million offer from Doctors Community Healthcare Corp., Scottsdale, Ariz., is pending, but hospital officials argue that Doctors Community's finance are too weak. D.C. Mayor Anthony A. Williams has said that the city will not provide further funding. (ABI 07-Oct-99) HIGH POINT: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: High Point Homes Sales, Inc. 158 Clapham Road Frederics, DE 19946 Court: United States Bankruptcy Court Delaware Case No: 99-3519 Case Filed:October 1, 1999 Attorney For Debtor: David T. Pryor Hudson, Jones, Jaywork & Fisher 225 South State Street Dover, Delaware 19901 List of 20 Largest Unsecured Creditors: Name Amount ---- ------ PNC Bank of Delaware $224,143 Allen E. Starke, Sr. 70,000 Homette Corporation 56,761 PNC Bank NA 50,000 Suntrust Credit 48,000 Allan E. Starke, Jr. 16,800 Prickett, Jones, Elliott & Kristol 3,027 Michael B. Mobley 1,730 Shore Stop Company, LLC 1,597 Browning Ferris IND 1,549 Delmarva Transporters, Inc. 1,381 Masten Lumber & Building 1,223 Blevins, Inc. 1,223 Wyoming Concrete Industries, Inc. 1,068 Delmarva Online 1,002 Lowes Business Account 952 Window Son & Dashiell, PA 860 Preston R. Smith 850 Harold D. Shockley 480 Carlson Pest Control, Inc. 475 INTERSCIENCE COMPUTER: Acquires Camino Systems Inc. --------------------------------------------------- On September 17, 1999, Interscience Computer Corporation acquired the assets of Camino Systems Inc. for 468,000 shares of the company's common stock and assumption of certain liabilities of Camino. The Camino assets consisted of certain business contracts and intangible personal property. The consideration for the Camino assets was determined through negotiations between the management of Camino and Interscience. Designed for the LAN, WAN, Internet and Intranet marketplace, Camino's Highway Server HSM software provides unlimited storage on multiple platforms by utilizing cost-effective optical jukeboxes as repositories for the vast amount of data accumulated on a network. Camino Highway Server provides transparent, multi-stage migration to optical storage from a variety of network platforms, including Novell NetWare, NT, Mac and Unix. It can accommodate virtually unlimited volumes of information, including database, image, audio/video, video conferencing and medical images. MEDPARTNERS: California Medical Association Resolves Impasse ------------------------------------------------------------ The California Medical Association announced yesterday that it has worked with the Davis Administration to push resolution of a key impasse in the MedPartners bankruptcy settlement negotiations, and that as a result, MedPartners will pay thousands of California physicians more than $50 million owed to them for patient care, according to a newswire report. Payments have been stopped since Aug. 2 because of MedPartners' and the health plans' mutual legal liability in the bankruptcy case. This week MedPartners will mail a physician release form to 6,000 California doctors; those who sign and return the release will formally become part of the MedPartners Final Agreement and be eligible to receive payment for unpaid claims. They also will waive their right to pursue a lawsuit against MedPartners Inc. of Alabama and the health plans that contracted with MedPartners. (ABI 07-Oct-99) MEDPARTNERS: Committee Objects To Exclusivity Extension ------------------------------------------------------- The Official Committee of Unsecured Creditors of Medpartners Provider Network, Inc. filed an objection to the debtor's motion seeking an extension of exclusivity. The Committee states that the debtor provides no evidence to justify this extension, and that the debtor "hides behind the still inchoate Global Agreement..." The Committee asserts that tit is prepared to draft and file a plan which comports with the Global Agreement. The Committee also states that the debtors fail to justify the thirteen week delay in implementing the Global Agreement. MERCURY AIR: Preference Actions Filed By Western Pacific -------------------------------------------------------- Mercury Air Group, Inc. (Amex: MAX; PCX) announced today that it has been served with a lawsuit in the United States Bankruptcy Court of the District of Colorado by the Trustee for Western Pacific Airlines, Inc. ("WPAI") (OTC Bulletin Board: WPACQ). The complaint seeks to recover alleged preferential payments of approximately $11.4 million. This amount represents cash received for payment of fuel during the 90 days prior to WPAI's initial bankruptcy filing on October 5, 1997. Mercury believes this claim is without merit and the entire amount is defensible based on the transaction: (1) having been a substantially contemporaneous exchange for value; (2) being made in the ordinary course of business; and (3) involving an exchange for new value. Mercury has also received notice that in the same action Compass Bank of Texas, Inc. ("Compass") has been sued for an alleged preference in the amount of approximately $1.1 million. Mercury entered into an agreement to indemnify and defend Compass as part of a $6 million note arrangement for WPAI in April of 1997. While Mercury has not yet finished its review of this second matter, it does believe that the payments in question were made in the ordinary course of business and are also defensible. Mercury Air Group, Inc. is a worldwide provider of aviation petroleum products, cargo services, aviation information technology and support services to international and domestic commercial airlines, general aviation and U.S. government aircraft. Founded in 1956 by three members of the American Volunteer Group in China, better known as the AVG Flying Tigers, Mercury reported fiscal year 1999 profits of over $5.9 million on revenues of over $224 million. MICHAEL PETROLEUM: Restructure Proposal Delivered To Noteholders ----------------------------------------------------------------- On September 30, 1999, representatives of Michael Petroleum Corporation delivered a revised debt restructuring proposal to holders of the company's 11 1/2% Senior Notes due 2005 and to the financial advisor for the unofficial committee of noteholders. The proposal contemplates issuing common stock of the company in exchange for 50% of the outstanding indebtedness evidenced by the Senior Notes, and New Senior Notes in exchange for the remaining 50% amount. The common stock to be issued in exchange for the Senior Notes would represent 50% of the outstanding common stock of the restructured company, before giving effect to potential dilution for certain Warrants to be issued. The revised proposal contemplates that the terms of the New Senior Notes would retain the same interest rate and maturity as the Senior Notes, and that certain covenants would be renegotiated. The revised proposal also contemplates the issuance of Warrants to the existing shareholders of the company, containing exercise provisions so that, if exercised, the existing shareholders of the company would own in excess of a majority (up to 90%) of the shares of outstanding common stock. The proposal contemplates that trade creditors of the company would be paid in full or otherwise remain unimpaired, and the company's outstanding $23 million indebtedness under its current bank facility would be refinanced from the proceeds of a new credit facility to be obtained. The restructuring could be implemented outside of insolvency proceedings or in connection with court-supervised bankruptcy proceedings, depending on the degree of noteholder support for the alternative chosen. The proposal described is preliminary in nature and no predictions are made by company management as to the degree of success the company may achieve in its negotiations with noteholders, whether a restructuring or refinancing of its Senior Note and senior bank indebtedness will be accomplished on the terms described, whether such a restructuring can be effected outside of bankruptcy, if at all, or if accomplished, whether the company will be able to achieve its business plan objectives following such a restructuring. Michael Petroleum Corporation also reported it would not make, on October 1, 1999, the approximately $7.8 million interest payment then due on its Senior Notes. The Indenture under which the Senior Notes were issued provides for a 30-day grace period before an Event of Default will occur due to the nonpayment of interest. If the interest payment is not made within the 30-day grace period, the Indenture provides that the entire indebtedness under the Senior Notes may be declared due and payable. Michael Petroleum is continuing to negotiate with the holders of the Senior Notes and its senior bank lender in an effort to restructure the company's indebtedness. NORTHWESTERN STEEL: Proposed Restructuring Of $115 Million Debt --------------------------------------------------------------- Northwestern Steel and Wire Company announces that as part of its strategic plan to build a new structural rolling mill in Sterling, Illinois, it has reached an agreement in principle with the steering committee of its 9 1/2% Senior Notes to restructure the $115 million of outstanding debt represented by the notes. The terms include: a payment of $50 million plus accrued and unpaid interest to the noteholders out of the company's funds and from the proceeds of a new revolving credit agreement expected to become effective in the near future; the issuance to the noteholders of common stock representing 70% of the outstanding common shares of the company on a fully diluted basis; and the noteholders will be given the right to elect 4 of 7 directors. The agreement in principle has been approved by the Board of Directors of Northwestern Steel and the steering committee will recommend its adoption by the noteholders. The company will also file an application under the Emergency Steel Loan Guarantee Act of 1999 to obtain a guarantee of new senior debt to fund the construction of the new mill. The agreement in principle with the noteholders is subject to, among other things (i) 95% acceptance by the noteholders; (ii) obtaining the federal guarantee of new senior debt; and (iii) stockholder approval. Fred Rocchio, Chief Executive Officer of Northwestern Steel and Wire, stated: "In concluding this agreement with the noteholders, Northwestern Steel has achieved another critical component of our strategic plan to build a new structural rolling mill. We have already reached agreement with the United Steelworkers of America for a new labor agreement and we have substantially completed the plans and feasibility studies for the new mill. Now, we need only secure the federal guarantee under the Emergency Loan Act for all of the components of our strategic plan to be in place. We are working closely with our bankers to file a guarantee application as soon as the regulations governing the guarantees are adopted, which is expected on or about October 18." Founded in 1879, the company is a major mini-mill producer of structural steel components that include wide flange beams, channels, angles and merchant bars, as well as rod and selected wire products. The structural products are used in a wide variety of commercial, industrial and residential construction applications. PARAGON TRADE: Appaloosa Management Owns 4.81% Of Common Stock -------------------------------------------------------------- Appaloosa Management L.P., reports beneficial ownership of 575,000 shares of the common stock of Paragon Trade Brands Inc., which represents 4.81% of the outstanding shares of common stock of the company. Appaloosa exercises sole voting and dispositive power over such shares. David A. Tepper shares ownership in the 575,000 shares of common stock, also exercising sole voting and dispostive powers. Appaloosa Management L.P. is the general partner of Appaloosa Investment Limited Partnership I, the investment advisor to Palomino Fund Ltd., and the managing member of Tersk LLC, which are the holders of record of 245,309, 298,825 and 30,866 shares, respectively. David A. Tepper is the sole stockholder and president of Appaloosa Partners Inc. Appaloosa Partners Inc. is the general partner of Appaloosa Management L.P. and David A.Tepper owns a majority of the limited partnership interests of Appaloosa Management L.P. PHAR-MOR INC: Fiscal Year-End Sales Level, Losses Down ------------------------------------------------------ Phar-Mor, Inc., a Pennsylvania corporation, operates a chain of discount retail drugstores devoted to the sale of prescription and over-the-counter drugs, health and beauty care products, baby products, pet supplies, cosmetics, greeting cards, groceries, beer, wine, tobacco, soft drinks, video rental and seasonal and other general merchandise. As of July 3, 1999, the company operated 139 stores in 24 states under the names of Phar-Mor, Rx Place and Pharmhouse. Approximately 55% of the company's stores are located in New York, New Jersey, Pennsylvania and Ohio, and approximately 22% are located in Virginia, West Virginia, North Carolina and South Carolina. Results of Phar-Mor's fiscal year ended July 3, 1999 show net sales of $1,206,539 with net loss of 1,592. For comparison, net sales in fiscal 1998 were $1,100,851 and net losses amounting to $8,830. PHILIP SERVICES: Plan Of Reorganization Calls For Indenture Issue ----------------------------------------------------------------- On June 25, 1999, Philip Services Corp., an Ontario corporation, together with its wholly owned subsidiary, Philip Services, Inc., a Delaware corporation, and certain of their subsidiaries filed a voluntary application with the Ontario Superior Court of Justice in Toronto, Canada, to reorganize under the Companies Creditors Arrangement Act (Canada) and voluntary petitions with the United States Bankruptcy Court for the District of Delaware, under Chapter 11 of the United States Bankruptcy Code. On June 27, 1999, the company obtained First Day Orders under Chapter 11 of the United States Bankruptcy Code from the Bankruptcy Court. On September 17, 1999 the company filed an Amended and Restated Plan of Compromise and Arrangement under the CCAA with the Ontario Superior Court of Justice in Toronto, Canada, and an Amended Joint Plan of Reorganization and a Disclosure Statement under Chapter 11 with the Bankruptcy Court. On September 21, 1999 the company filed a further Amended and Restated Plan of Compromise and Arrangement under the CCAA with the Ontario Superior Court of Justice in Toronto, Canada, and an Amended Joint Plan of Reorganization, together with the Amended Canadian Plan and a Disclosure Statement under Chapter 11 with the Bankruptcy Court. A confirmation hearing to confirm the Amended U.S. Plan is scheduled for November 3, 1999 at the Bankruptcy Court. The company proposes to issue, as part of the Amended U.S. Plan, up to $18 million of its 3% Convertible Subordinated notes due 2019. The notes will be issued to discharge, in part, claims of certain existing creditors in the bankruptcy proceedings. Description of the indenture issue and further information may be obtained by accessing http://www.sec.gov/cgi-bin/srch- edgar?0000950135-99-004575 on the Internet, free of charge. PHILIP SERVICES: Proposes Up To $60 Million In Senior Notes ----------------------------------------------------------- In connection with the company's amended U.S. Plan the company proposes to issue up to $60 million of its 6% Senior Subordinated Notes due 2009. The notes will be issued to discharge, in part, claims of certain existing creditors in the bankruptcy proceedings. For description of the proposed 6% Senior Subordinated Notes due 2009 issuance, and further information concerning the action access http://www.sec.gov/cgi-bin/srch-edgar?0000950135-99-004573 free of charge, on the Internet. PHILIP SERVICES: Seeks Extension To File Schedules and Statements ----------------------------------------------------------------- The debtors, Philip Services Inc., et al., seek an extension of time to file schedules and statements. The debtors seek an order further extending their time for filing the Schedules and Statements by 70 days, through and until December 17, 1999. Additionally, the debtors request that they be permanently relieved of any obligation to file the Schedules and statements in the event the court confirms the debtors' proposed plan of reorganization and such plan becomes effective by December 17, 1999. The debtors' Confirmation Hearing is scheduled to commence on November 3, 1999 at 9:30 AM. PRICHARD ALA: Files Chapter 9 ------------------------------ Prichard, Ala., has filed for chapter 9 protection after searching for several weeks for an alternative solution, according to a newswire report. Prichard is the largest city in the state to ever file for bankruptcy protection. The City Council had tried to borrow to buy its way out of debt, but the chapter 9 filing was considered the only viable option. (ABI 07- Oct-99) SERVICE MERCHANDISE: Increases Borrowing Capacity ------------------------------------------------- Service Merchandise Company, Inc. (NYSE:SME) announced that its lenders have approved an amendment to its $ 750 million debtor- in-possession (DIP) financing agreement that provides for the release of the $ 50 million borrowing base reserve which had been in effect pending negotiation of financial covenants. The adoption of the covenant package provides the Company an additional $ 50 million in availability under the DIP facility, as the borrowing base reserve is eliminated. The covenants require the Company to maintain either a minimum EBITDA (earnings before interest, taxes, depreciation, and amortization) performance OR minimum availability under the facility. Under the DIP agreement, the Company's senior lenders, led by Citibank as administrative agent and BankBoston as documentation agent and collateral monitoring agent, provided $ 750 million in post-petition financing to fund the Company's operations during its restructuring. "The two-pronged nature of this covenant and its reasonable EBITDA thresholds signify the strong support and confidence of our lenders. We believe that the flexibility of the covenants, coupled with the release of the $ 50 million reserve, will further increase our merchandise vendors' confidence in our liquidity and will maintain the momentum of their return to normalized payment terms," said Chief Executive Officer Sam Cusano. Under the terms of the amendment, a maximum annual capital expenditure covenant is set at $ 50 million. Additional flexibility is provided to carry over 50 percent of unused capital expenditures from a prior year and to earn additional capital expenditure capacity as EBITDA rises. "This additional boost to our liquidity raises the Company's availability to approximately $ 185 million as of October 5, 1999," said Thomas Garrett, Chief Financial Officer. "This development further demonstrates the confidence shown by our lenders." Service Merchandise and its subsidiaries filed voluntary petitions for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Middle District of Tennessee in Nashville on March 27, 1999. Known as "America's Leading Jeweler," Service Merchandise is a specialty retailer focusing on fine jewelry, home and gift products. STORMEDIA: Taps Special Litigation Counsel ------------------------------------------ Stormedia Incorporated, debtor and Stormedia International Ltd seek authority to employ Hennigan, Mercer & Bennett as special litigation counsel to represent the debtors in two cases with Maxtor Corp. The firm will handle the matters on a contingency basis. Postpetition fees to the firm were in the amount of $765,640 and $167,432 as expenses. TALK AMERICA: Order Approves Asset Purchase Agreement ----------------------------------------------------- The US Bankruptcy Court, District of Maine entered an order on September 30, 1999 approving that certain asset purchase agreement between the debtor Talk America, Inc. and DanMark, Inc. WELLCARE MANAGEMENT: Receives Release of Supervision ---------------------------------------------------- The WellCare Management Group, Inc., parent company of WellCare of New York, Inc. and WellCare of Connecticut, Inc., held its Annual Meeting of Shareholders Meeting on September 30, 1999. At the meeting, Kiran C. Patel, M.D., Mark D. Dean, D.D.S., Rupesh Shah, Pradip C. Patel and Mary Lee Campbell-Wisley, all current WellCare Board members, were elected to serve on the Board until WellCare's next annual meeting. Additionally, the shareholders adopted an Amendment to WellCare's Restated Certificate of Incorporation, as amended, to increase the number of Common Stock authorized for issuance from 20 million shares to 75 million shares. The Amendment was adopted to allow for future stock dividends, acquisitions (no acquisition is currently pending), general corporate purposes and to provide the Board adequate flexibility to accomplish stock splits and other corporate transactions as may arise from time to time. The increase in the authorized shares of Common Stock was also required to provide sufficient Common Stock to be issued pursuant to the recently completed transactions with Dr. Patel and The 1818 Fund II, L.P. in June 1999. Finally, the Shareholders ratified the Board's selection of Deloitte & Touche, LLP as independent auditors of WellCare for the year ending December 31, 1999. WellCare also announced the Officers for WellCare, WCNY and WCCT. Kiran C. Patel, M.D. will serve as Chairman of the Board, President and Chief Executive Officer of WellCare, Secretary of WCNY and Chairman of the Board of WCCT; Mary Lee Campbell-Wisley will serve as Secretary of WellCare, Chairman of the Board, President and Chief Executive Officer of WCNY and Secretary, President and Executive Director of WCCT; Hitesh Adhia will serve as the Interim Acting Chief Financial Officer for WellCare, WCNY and WCCT and; Sandip I. Patel will serve as the General Counsel to WellCare, WCNY and WCCT. The Officers will serve in their respective capacity until WellCare's next annual Board meeting. WellCare also announced that it has received a release of the order from the State of Connecticut Insurance Department requiring WCCT to submit to administrative supervision by the State's Insurance Commissioner. The order was issued on May 26, 1999 to WCCT by the Insurance Department based on the determination that WCCT was not in compliance with the State of Connecticut's minimum net worth requirement for a health maintenance organization. WCCT was released from administrative supervision based upon its meeting the $ 1 million statutory net worth requirement. Additionally, Dr. Patel's application for the acquisition of control of WCCT was approved by the Connecticut Insurance Department. In furtherance of this approval, WCCT is required to file balance sheets and income statements with the Insurance Department on a monthly basis for a period of one year and file reports of business operations in Connecticut on a quarterly basis for a period of two years. WCCT must also file with the Insurance Department (1) a plan for handling insolvency, (2) a plan to establish and maintain a mechanism to afford its members an opportunity to participate in matters of policy and operation and, (3) an amended Insurance Holding Company System Annual Registration Statement. Dr. Patel, Chairman and Chief Executive Officer of WellCare, stated, "I am excited about the implementation of my management team into the Connecticut operations. Though we face a number of challenges from the past, I believe that this team can work closely and in partnership with the physicians, hospitals, payors and members to eliminate all outstanding issues and progress forward by providing high quality, affordable healthcare in the State of Connecticut." WellCare's service area extends from New York City to the southern Adirondacks, west into the Mohawk River Valley and Southern Tier counties, and east into Connecticut. BOND PRICING FOR WEEK OF October 4, 1999 ======================================== DLS Capital Partners, Inc., bond pricing for week of October 4, 1999 Following are indicated prices for selected issues: Acme Metal 10 7/8 '07 18 - 20 (f) Amer Pad & Paper 13 '05 28 - 31 Asia Pulp & Paper 11 3/4 '05 66 - 67 E & S Holdings 10 3/8 '06 38 - 42 Fruit of the Loom 8 7/8 '06 39 - 41 Geneva Steel 11 1/2 '01 18 - 20 (f) Globalstar 11 1/4 '01 62 - 64 Hechinger 9.45 '12 9 - 12 (f) Integrated Health 9 1/2 '07 11 - 13 (f) Iridium 14 '05 12 - 13 (f) Just for Feet 11 '09 15 - 18 Loewen 7.20 '03 48 - 50 (f) Planet Hollywood 12 '05 26 - 28 (f) Purina Mills 9 '10 22 - 26 (f) Revlon 0 '01 18 - 20 Service Merchandise 9 ''04 14 - 16 (f) Sunbeam 0 '18 16 - 16 1/2 TWA 11 3/8 '06 58 - 60 United Artists 9 3/4 '08 22 - 26 Vencor 9 7/8 '05 20 - 22 (f) Zenith 6 1/4 '11 17 - 20 (f) ********* The Meetings, Conferences and Seminars column appears in the TCR each Tuesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. Bond pricing, appearing in each Friday edition of the TCR, is provided by DLS Capital Partners, Dallas, Texas. S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter, co- published by Bankruptcy Creditors' Service, Inc., Princeton, NJ, and Beard Group, Inc., Washington, DC. Debra Brennan, Yvonne L. Metzler, Editors. Copyright 1999. All rights reserved. ISSN 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *