CHATTANOOGA, Tenn., Feb. 29, 1996 - href="chap11.krystal.html">The Krystal Company
(Nasdaq-NNM: KRYSQ), an operator and franchisor of quick-service
hamburger restaurants, today reported a loss for the quarter ended
December 31, 1995, of $1,135,000, or 15 cents per share. The prior
year's fourth quarter net income was $1,417,000, or 19 cents per
share. The quarter's loss in 1995 was a result of a charge of $3.9
million recorded to write down certain restaurant locations to
estimated realizable values. Disregarding this charge, the Company
would have reported net income of $1,290,000, or 17 cents per share.
Year to date for the twelve months ended December 31, 1995, the
Company had a loss $5,324,000, or 71 cents per share, compared to
net income of $6,189,000, or 82 cents per share for the twelve
months ended January 1, 1995. Without a third quarter 1995 special
charge of $10 million for certain wage and hour litigation to which
the Company is a party and the fourth quarter 1995 charge of $3.9
million, net income for the twelve months ended December 31, 1995
would have been $3,301,000, or 44 cents per share. The Company also
recorded a special charge of $2.0 million at year end 1994 for the
wage and hour litigation. Without that special charge, fourth
quarter 1994 and total year 1994 earnings per share were 35 cents
and 99 cents, respectively.
Total revenues for the fourth quarter were $63.8 million, up
approximately 0.7% from the previous year. Total revenues for the
twelve months ended December 31, 1995 were $248.0 million, compared
with the previous year's $248.3 million. Restaurant sales for the
fourth quarter increased 1.0% to $61.8 million. Restaurant sales
for the total year 1995 were $239.4 million compared to $239.1
million for the total year 1994.
Company-owned same restaurant sales for the fourth quarter of
1995 were down 0.6% versus the same period in 1994. For the total
year 1995, same restaurant sales were down 2.9% versus 1994. The
Company had 256 restaurants open at the end of the fourth quarter of
1995 compared to 252 at the end of 1994. Ten double drive-through-
only Krystal Kwik restaurants are included in the same restaurants
open in each year.
The Company opened six new restaurants in 1995 versus 18 in
1994, and franchisees opened 23 new restaurants in 1995 compared to
22 in 1994.
Fourth quarter 1995 revenues included franchise fees and
royalties of $816,000 compared with $737,000 in the fourth quarter
of 1994, an increase of 10.7%. Franchise fees and royalties for the
year 1995 were $3,038,000, compared with $2,676,000 for 1994, an
increase of 13.5%. Krystal began franchising in late 1990 and had 80
franchised restaurants in operation at the the end of 1995 comapared
to 65 at the end of 1994. Sales by franchisees were $15.6 million
for the fourth quarter 1995, up 28.0% over the same period in 1994.
Total 1995 sales by franchisees were $54.0 million, up 27.5% over
1994.
On December 15, 1995, the Company filed a voluntary petition
under Chapter 11 of the United States Bankruptcy Code for the
purpose of completely and finally resolving various claims filed
against the Company by current and former employees alleging
violations of the Fair Labor Standards Act (FLSA). The Company is a
debtor-in-possession for purposes of the bankruptcy case.
Currently, approximately 5,100 current or former employees have
filed claims in unspecified amounts alleging that they worked time
for which they were not compensated. The Company expects to contest
any claims which it believes to be invalid. The Bankruptcy Court
has established 90 days following the mailing of notice as the bar
date by which all claimants must file their claims or have them
forever barred, and it is estimated that the notice will be mailed
on or before March 8, 1996. The Company will file a proposed
Chapter 11 Plan as soon as practicable thereafter. Four previously
disclosed lawsuits filed against the Company under the FLSA have
been stayed by the bankruptcy filing.
The Krystal Company operates 256 restaurants in Alabama,
Arkansas, Florida, Georgia, Kentucky, Mississippi, South Carolina
and Tennessee. Krystal franchisees operate 80 restaurants located in
Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana,
Mississippi, North Carolina, South Carolina, Tennessee, and
Virginia.
Founded in 1932, Krystal is one of the oldest fast-food chains
in the United States. The Krystal Company's common stock is traded
on the Nasdaq National Market under the symbol KRYSQ.
THE KRYSTAL COMPANY
Fourth Quarter
1995 1994
Revenues $63,823,000 $63,386,000
Net income before special chgs. $ 1,290,000 $ 2,657,000
Net (loss) income $(1,135,000) $ 1,417,000
Average shares 7,539,000 7,510,000
Net income per share before
special charges $ .17 $ .35
Net (loss) income per share $ (.15) $ .19
Twelve Months
1995 1994
Revenues $248,028,000 $248,322,000
Net income before special
charges $ 3,301,000 $ 7,429,000
Net (loss) income $ (5,324,000) $ 6,189,000
Average shares 7,517,000 7,512,000
Net income per share before
special charges $ .44 $ .99
Net (loss) income per share $ (.71) $ .82
Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)
3 mos. ended 12 mos. ended
12/31/95 1/1/95 12/31/95 1/1/95
Revenues:
Restaurant sales $61,789 $61,152 $239,376 $239,104
Franchise fees 114 195 618 796
Royalties 702 542 2,420 1,880
Other revenue 1,218 1,497 5,614 6,542
Total 63,823 63,386 248,028 248,322
Costs and expenses:
Cost of restaurant sales 50,347 48,782 196,831 192,256
Deprec. and amort. expense 3,034 2,993 12,311 11,213
Gen. and admin. expenses 6,920 5,977 26,154 25,775
Other expenses, net 1,016 1,116 4,417 4,946
Provision for loss on
restaurant closings and other
property write-downs 3,911 --- 3,911 ---
Special charge 0 2,000 10,000 2,000
Total 65,228 60,868 253,624 236,190
Operating income/(loss) (1,405) 2,518 (5,596) 12,132
Interest expense (1,004) (1,030) (4,134) (3,801)
Interest income 153 277 718 820
Income/(loss) before provision
/(benefit) for income taxes (2,256) 1,765 (9,012) 9,151
Provision/(benefit) for income
taxes (1,121) 348 (3,688) 2,962
Net income/(loss) $(1,135) $ 1,417 $ (5,324) $ 6,189
Earnings/(loss) per
common share: $ (0.15) $ 0.19 $ (0.71) $ 0.82
Wtd. avg. number of common
shares outstanding 7,539 7,510 7,517 7,512
NOTE: This is not a complete set of financial statements. The
1995 statements are subject to further audit and reclassifications.
Consolidated Balance Sheets
(In thousands)
12/31/95 1/1/95
ASSETS (Unaudited) (Audited)
Current Assets:
Cash and temporary investments $ 13,713 $ 14,804
Receivables 1,752 2,158
Income tax receivables 609 ---
Net investment in direct financing leases -
current portion 856 766
Inventories 2,322 2,137
Deferred tax asset 5,553 2,319
Prepayments and other 830 781
Total current assets 25,635 22,965
Net investments in direct financing leases,
excluding current portion 867 1,723
Property, buildings and equipment, net 98,546 98,798
Leased properties, net 1,863 2,090
Other assets:
Cash surrender value of life insurance 5,117 4,429
Other 667 781
Total other assets 5,784 5,210
Total assets $132,695 $130,786
LIABILITIES AND SHAREHOLDERS' EQUITY 12/31/95 1/1/95
Current Liabilities: (Unaudited) (Audited)
Accounts payable $ 1,681 $ 7,104
Accrued liabilities 8,962 12,803
Current portion of long-term debt 432 3,472
Current portion of capital lease obligations 653 621
Income taxes payable --- 318
Total current liabilities 11,728 24,318
Liabilities subject to compromise 57,480 ---
Long-term debt, excluding current portion 3,621 40,053
Capital lease obligations, excluding current
portion 2,754 3,438
Deferred income taxes 2,719 4,495
Other long-term liabilities 7,746 6,846
Shareholders' equity:
Preferred stock, without par value; 5,000,000
shares authorized; no shares issued and
outstanding --- ---
Common stock, without par value; 15,000,000
shares authorized; shares issued and
outstanding: 7,509,848 at Jan. 1, 1995
and 7,526,808 at Dec. 31, 1995 40,830 40,909
Retained earnings 8,195 13,438
Deferred compensation (2,378) (2,711)
Total shareholders' equity 46,647 51,636
Total liabilities and shareholders' equity $132,695 $130,786
NOTE: This is not a complete set of financial statements. The
1995 statements are subject to further audit and reclassifications.
BILOXI, Miss., Feb. 29, 1996 - Casino America, Inc.
(Nasdaq: CSNO) and Grand Palais
Riverboat, Inc., a wholly owned
subsidiary of Hemmeter Enterprises, Inc., announced today that the
Bankruptcy Court in the Eastern District of Louisiana today approved
the Disclosure Statement submitted by Grand Palais. Approval to the
Plan of Reorganization will now be solicited from all parties. A
hearing to confirm the Plan has been scheduled for March 26, 1996.
The closing of the transaction is subject to a number of other
conditions, including regulatory approvals and other consents and
approvals. The parties are currently anticipating a closing of the
transaction to occur within 60 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, 601-436-7005,
or Rex Yeisley, Chief Financial Officer, 601-436-7054, or Douglas
Draper, Counsel for Grand Palais, 504-581-9595
DETROIT and ROSEMONT, Ill., Feb. 29, 1996 - The Stroh
Brewery Company and G. Heileman Brewing Company, Inc., announced
today that Stroh and Heileman have signed a letter of intent
providing for the acquisition by Stroh of all Heileman assets.
The transaction, which is expected to be completed by July 1996,
includes Stroh's acquisition of Heileman's five breweries located in
LaCrosse, Wisconsin; Baltimore, Maryland; Portland, Oregon; Seattle,
Washington; and San Antonio, Texas; and a beverage manufacturing
facility in Perry, Georgia. Stroh also will acquire all of
Heileman's brands, including Special Export, Old Style, Rainier,
Henry Weinhard, Schmidt's, Lone Star, Champale, Colt 45, and
Mickey's.
"We are extremely pleased to be acquiring Heileman," said
William L. Henry, President and Chief Executive Officer of The Stroh
Brewery Company. "The combination of the companies' employees, high-
quality brand portfolios, and strategically located breweries will
create significant strengths. We will become a stronger competitor
in a highly competitive industry, both domestically and
internationally."
Thomas 0. Hicks, Chairman and Chief Executive Officer of Hicks,
Muse, Tate & Furst Incorporated, Heileman's current controlling
shareholder, said: "Since we acquired Heileman in 1994, we have
awaited a rebound of the beer industry and an improvement in
Heileman's financial performance, neither of which, for various
reasons, has yet occurred. Accordingly, we have determined to focus
our resources elsewhere. While the performance of our investment in
Heileman has been disappointing, we are proud that, reflecting the
outstanding performance of the rest of our investment portfolio, the
overall performance of our Equity Fund II - even after our loss on
Heileman of approximately $54 million - is an indicated internal
rate of return of at least 30 to 40 percent."
M.L. Lowenkron, President and Chief Executive Officer of G.
Heileman Brewing Company, Inc., said: "Although this was a
difficult decision to make, I believe that, in light of our current
financial position, this transaction is not only a positive move for
Stroh, but also for many employees of Heileman. It helps to ensure
that our fine beer brands will continue to be available to our
customers and it strengthens the position of the combined enterprise
as a viable, long term competitor in the beer industry."
Under the letter of intent, Stroh, upon consummation of the
transaction, will retire Heileman's bank debt, assume all trade and
other specified liabilities of Heileman, and issue a combination of
Stroh debt and equity securities that Heileman will exchange for its
outstanding bonds and common stock. The Stroh securities to be
issued include an estimated $60 million to $70 million of ten-year
senior subordinated notes bearing interest at 425 basis points over
treasury securities of corresponding maturity (with the exact amount
of such notes to be determined by a formula); $5 million of 11%
junior subordinated notes; and ten-year warrants for 7.5% of the
outstanding Stroh common stock. The warrants would be subject to a
put-call arrangement in five years based upon appraised fair market
value.
The letter of intent is subject to negotiation of definitive
agreements, regulatory approvals, Heileman stockholder and
bondholder approval, and other conditions. The closing of the
transaction is expected to take place by July 1, 1996, subsequent to
a pre-arranged bankruptcy filing by Heileman, which will be used to
confirm the restructuring of Heileman's existing senior subordinated
notes and of its equity. All trade liabilities will be assumed by
Stroh. A majority of Heileman's stockholders, and an informal
noteholder committee consisting of holders of approximately 50% of
Heileman's outstanding senior subordinated notes, have indicated
their full support of the transaction and the restructuring.
"The acquisition of Heileman is an integral part of Stroh's
long- range plans," Mr. Henry said. "We recognize the challenges
facing the combined company, but are confident that we can lead an
expedited, smooth transition and meet those challenges effectively
and efficiently," he concluded.
The Stroh Brewery Company, family owned and operated since 1850,
is the nation's fourth largest brewing company, with brewing
facilities in St. Paul, Minnesota; Longview, Texas; Lehigh Valley,
Pennsylvania; Winston-Salem, North Carolina; and Tampa, Florida.
Stroh produces a number of high-quality beer brands including
Stroh's, Old Milwaukee, Schlitz, Schaefer and Schlitz Malt Liquor.
G. Heileman Brewing Company, Inc., founded in 1858, is the fifth
largest brewing company in the United States. Since January 1994,
the controlling shareholder of Heileman has been an affiliate of
Hicks, Muse, Tate & Furst Incorporated, a private investment firm
with offices in Dallas, New York, St. Louis, and Mexico City.
CONTACT: Lacey Logan of Stroh, 313-446-3118; or Roy Winnick
of Kekst and Company, 212-593-2655, for Heileman
RICHMOND, Va., Feb. 29, 1996 - href="chap11.consumat.html">Consumat Systems, Inc.
(OTC-Bulletin Board: CSMT), the Richmond, Virginia based
incineration and pollution control equipment manufacturer, announced
today that its Second Amended Plan of Reorganization has been
confirmed by the United States Bankruptcy Court for the Eastern
District of Virginia in Richmond. Robert L. Massey, President and
Chief Executive Officer of Consumat, stated that "the votes from
both our creditors and our stockholders were overwhelmingly in favor
of the Plan."
As previously reported, the Company filed for protection under
Chapter 11 of the United States Bankruptcy Code on October 6, 1995.
The filing was precipitated by several pieces of protracted
litigation and difficulty in raising capital due to the litigation.
Sirrom Capital Corporation (Sirrom), a small business investment
company based in Nashville, Tennessee, has provided $1 million in
capital to the Company during the bankruptcy case. Sirrom has
agreed to provide an additional $500,000 to the Company to fund the
Plan of Reorganization and to fund the future growth of the
business.
The Company also announced preliminary unaudited results for the
year ended December 31, 1995, which indicate net income of $89,126
on revenues of $4,399,309. Audited results for this period should
be released prior to the end of March. Mr. Massey stated that "we
are very pleased with these results since they were achieved despite
significant professional fees associated with litigation and the
bankruptcy." He further stated that "the quarter ended December 31,
1995 was the sixth consecutive quarter of profitable operations and
backlog has continued to improve with the infusion of new capital."
CONTACT: Robert L. Massey or Mark E. Hills of Consumat Systems,
Inc., 804-746-4120
BOSTON, Feb. 29, 1996 - As part of a national crackdown
on bankruptcy fraud announced by U.S. Attorney Janet Reno today,
U.S. Attorney Donald K. Stern and F.B.I. Special Agent-in-Charge
Richard S. Swensen announced that four federal criminal cases have
been filed in Boston against current and former Massachusetts
residents, charging them with bankruptcy fraud. These cases were
referred by the U.S. Trustee's Office.
U.S. Attorney Donald K. Stern explained the importance of the
cases to Massachusetts: "The number of bankruptcy cases filed in
Massachusetts remains high, so the potential for abuse is great.
Ten years ago only a few thousand bankruptcy cases were filed here
each year, but in the late eighties and early nineties the numbers
soared and have remained high through today, topping over 14,000.
The dollars at stake are also significant: in the last 2-1/2 years,
over $100 million has been collected and distributed to creditors by
the bankruptcy Trustee in Massachusetts. This volume of continued
bankruptcy business means we must remain vigilant against anyone
tempted to cheat the system."
"The bankruptcy system is a good one, if it works fairly,"
explained Stern. "Deserving debtors get a fresh start, or at least
some breathing room to get back on their feet. Creditors who are
owed money receive their fair share of whatever assets the bankrupt
had."
"But," continued Stern, "in the criminal cases announced today,
the bankrupt debtors cheated their creditors, by hiding assets,
keeping monies for themselves, or not allowing the creditors, who
are often small businesses, to receive what was fairly owed to
them."
Stern commented, "Debtors shouldn't get a false start. They
should get a fresh start."
The federal criminal bankruptcy fraud charges announced today in
Massachusetts are against JEROME ROSEN, 77, of 36 Bullard Road,
Weston, Massachusetts; JAMES D. KINKEAD, 57, of Florida, and
formerly of 48 Birch Road, Natick, Massachusetts; DAVID M. FLANAGAN,
41, of 640 Central Avenue, Leominster, Massachusetts; and JAMES D.
CROWLEY, 44, of 131 Jefferson Street, Braintree, Massachusetts.
Attorney JEROME E. ROSEN was charged in a four-count mail fraud
indictment with trying to defraud creditors by concealing over
$500,000 which he and others were to receive from the sale of land
in Maine owned by bankruptcy debtor N.E. Tri-State.
JAMES D. KINKEAD was charged in a two-count bankruptcy fraud
indictment with having concealed, during his personal bankruptcy
proceedings, his ownership of a computer equipment sales business
called Express U.S.A., Inc., and of his interest in a Maine
condominium. According to the indictment, KINKEAD tried to hide the
ownership interest in the computer company by incorporating it in
his then wife's name, without her knowledge or consent, to protect
the business from his creditors. After his personal bankruptcy
proceeding was concluded, KINKEAD caused ownership to be conveyed to
himself.
DAVID M. FLANAGAN was charged in a four-count bankruptcy fraud
indictment with concealing nearly $100,000 in assets in his
bankruptcy. He is alleged to have concealed his ownership of real
property located at 640 Central Street, Leominster, Massachusetts;
with making a false statement concerning his ownership of a
corporation called Corporate Realty, Inc., which owned an apartment
building at 100-104 Daniels Street, Fitchburg; Massachusetts; with
making false statements in his bankruptcy schedules falsely denying
that he was an officer of Corporate Realty Inc., when in fact he
was; and with falsely representing that he paid rent for his
personal residence, when in fact, he paid no such rent and actually
owned the property.
JAMES R. CROWLEY was charged in a one-count information with
fraudulently concealing money belonging to bankruptcy debtor
Colonial Color Corporation, a company he controlled, by taking
checks worth about $27,000 for himself, although the checks were
really assets of Colonial Color Corporation.
The four defendants announced today face maximum penalties of
five years' imprisonment and a $250,000 fine on each of the counts
charged.
In addition to the four new criminal cases in Massachusetts
announced today, other bankruptcy fraud convictions have been
obtained by the U.S. Attorney's Office in Massachusetts during the
last year, including the following:
Earlier this month, Attorney MARTHA KLEINERMAN pleaded guilty to
having embezzled about $9,200 in funds belonging to a bankruptcy
debtor client.
In January, 1996, JOHN J. SNELL, Sr., pleaded guilty to having
concealed jewelry and a bank account, with a total value of about
$40,000 in his bankruptcy.
Also in January, MAURICE LAVOIE pleaded guilty to having
concealed furniture inventory of bankruptcy debtor Linwood Mills,
Inc., a company he owned and operated.
In 1995, Attorney JOHN A. MAIONA, who was formerly a bankruptcy
trustee, was convicted of having embezzled more than $1 million from
bankruptcy debtors for which he was serving as trustee.
In 1995, bankruptcy debtor IAN EDWARDS was convicted by a jury
for having concealed his interest in a Barbados condominium.
In 1995, bankruptcy debtor MICHAEL SHADDUCK, a financial
advisor, was convicted by a jury for concealing his ownership of
more than $100,000 which he had given to a friend to hold while he
filed for bankruptcy; and for falsely denying the existence of life
insurance policies, a pension plan and a bank account. His wife,
ANDREA SHADDUCK, a co-debtor in bankruptcy, was also convicted of
one count of making a false statement in the bankruptcy schedules
concerning the bank account.
Nationwide, as part of "Operation Total Disclosure" announced
today, criminal charges were filed in 123 defendants in 36 federal
districts.
Across the country, as of September 30, 1995, there were 883,000
bankruptcy cases pending in federal courts, involving $7 billion in
assets and several times that in claims. Among the largest
creditors is the U.S. Treasury which is owed over $12 billion.
"Operation Total Disclosure" was the result of a multi-agency
effort involving the United States Trustee Program, U.S. Attorneys,
the FBI and the Criminal Division and Tax Division of the Department
of Justice, in close coordination and participation with the
Internal Revenue Service and the Postal Inspection Service. There
are 21 U.S. Trustees who are responsible for overseeing the
administration of cases filed under the United States Bankruptcy
Code throughout the United States.
Attorney General Reno said that the Justice Department's
intensified bankruptcy fraud enforcement efforts would continue
indefinitely. She praised the U.S. Attorneys and U.S. Trustees for
giving additional resources and priority to the crackdown on
bankruptcy fraud.
The four new charges announced today in Massachusetts were
investigated by agents of the Federal Bureau of Investigation, were
referred by the U.S. Trustee's Office in Boston and Worcester, and
are being prosecuted by Assistant U.S. Attorney Mark J. Balthazard
of Stern's Economic Crimes Unit.
CONTACT: Joy Fallon or Anne-Marie Kent of the U.S. Attorney's
Office, 617-223-9445
ISSAQUAH, Wash. -- Feb. 29, 1996 -- Midisoft
Corporation (Nasdaq National Market: MIDI) today reported financial
results for its fourth quarter and year ended December 31, 1995.
Revenues for the year ended December 31, 1995 were $5,420,000
compared to $4,989,000 in the prior year. After a non-recurring
restructuring charge of $3,898000, or $.84 per share, the Company
reported a net loss of $12,132,000 or $2.60 per share compared to
net income of $118,000 in 1994.
As previously reported, in the second half of 1995 Midisoft
significantly restructured its operations, including the ending of
support for products not directly related to the Company's core
competencies in audio and music software; comprehensive management
changes; and workforce reductions. In this regard, included in the
non- recurring restructuring charge for 1995 was the write-off of
capitalized software associated with prior investments in
educational and presentation products. In addition the company
incurred significant severance expenses associated with recent
management changes and workforce reductions. Also during 1995,
additional costs were incurred in sales and marketing and research
and development related to discontinued and restructured areas of
the Company's business.
On February 27, 1996, Midisoft announced that it settled,
without admission of wrongdoing, the class action securities lawsuit
filed against it in March 1995. Pursuant to the settlement, the net
loss in the fourth quarter and year ended December 31, 1995 included
a charge of $1,643,750, the value of the cash and common shares
contributed by Midisoft in the settlement.
Also contributing to the Company's increased expenses in 1995
were higher accounting and legal costs associated with the above
noted shareholder suit; increases in sales and marketing associated
with several new product releases and upgrades; higher expenses from
amortization of capitalized software; and settlement of a 1993
lawsuit with a former employee. These higher expenses could not be
offset by the modest increase in sales, particularly in the second
half of 1995, which were the result of the late introduction of
certain new products and the increased allowances for returns of
older products.
Larry Foster, Midisoft's new President and Chief Operating
Officer, commented, "1995 was a year of profound change for
Midisoft. Although these changes had a negative impact on the
Company's financial results for the year, we believe Midisoft has
entered 1996 as a conservatively managed technology company which
has retained its focus and leadership position in the market for
audio, music and media integration software. We have eliminated non-
performing business areas and personnel while significantly
strengthening our product development, channel sales and marketing
capabilities. Throughout this aggressive program, we have carefully
managed our assets and remain in a stable financial position, with
cash and investments of $3.7 million, working capital of $5 million
(excluding settlement accrual to be resolved with common stock), and
no debt. With our streamlined organization and significantly lower
expenses expected in 1996, which should result in a positive cash
flow for the first time in the Company's history, we believe we are
sufficiently capitalized to meet our 1996 business plan."
With respect to the outlook for sales in 1996, Mr. Foster noted
that existing distribution channels for Midisoft products had been
largely cleared of older and discontinued products by the 1995 year-
end. Commenting on new products, he said, "By the end of 1995,
Midisoft offered a roster of 13 innovative multimedia and music
products for the consumer, professional and OEM markets. We expect
a growing revenue contribution to the Company this year from these
products which include the upgraded, Windows 95-compliant 4.0
version of our flagship Midisoft Studio(TM) and the Midisoft Play
Piano(TM) CD-ROM, which has novice musicians playing popular songs
in just hours.
Mr. Foster added that the Company has recently strengthened its
base of retailers. "In addition to our ongoing relationships with
such leading names as Computer City, Best Buy and Incredible
Universe, already this year we have added a significant new retail
channel for Midisoft products, Tower Records, with more than 90
stores, and have expanded the number of Midisoft products carried at
major software retailers including Electronics Boutique, CompUSA and
MediaPlay Stores. The Midisoft MediaWorks multimedia product suite
for business solution, is being sold to leading OEMs, including NEC,
Acer and IBM, for integration with their computer products. We will
soon introduce an upgraded version of MediaWorks which further
leverages Midisoft's audio expertise and positions the Company for
growth in this expanding market."
Raymond Bily, Midisoft's Chairman and Chief Executive Officer,
said, "Contributions from the new members of our management team
cannot be underestimated. Larry Foster and Melinda Bryden, our new
CFO, leveraged their many years of experience in their respective
areas of expertise to help Midisoft complete its reorganization and
return to our core competencies."
Mr. Foster concluded, "Our refocus on our core strengths in
audio and music technology combined with our significantly reduced
expense structure, position Midisoft to improve its operating
results this year. We will work diligently to increase our sales
and manage our capital."
Midisoft is a leader in audio, music and media integration
software sold at retail and licensed to hardware manufacturers.
MIDISOFT CORPORATION
STATEMENTS OF OPERATIONS
(In thousands except per share data)
(Unaudited) (Audited)
Three Months Ended Year Ended
December 31, December 31,
1995 1994 1995 1994
Revenues $ 959 $ 685 $ 5,420 $
4,989
Cost of revenues 790 275 2,490
1,082
Gross profit 169 410 2,930
3,907
Operating expenses:
Sales and marketing 1,149 680 4,097
2,142
General and
administrative 1,261 578 4,015
1,160
Research and development 565 253 1,787
617
Restructuring charge 1,529 - 3,898
-
Settlement expense 1,644 - 1,644
-
Total operating expenses 6,148 1,511 15,441
3,919
Operating income (loss) (5,979) (1,101) (12,511)
(12)
Interest and other income 40 126 379
183
Income (loss) before
taxes (5,939) (975) (12,132)
171
Provision for income
taxes - (331)
- 53
Net income (loss) $ (5,939) $ (644) $(12,132) $
118
Net income (loss)
per share $ (1.27) $ (0.14) $ (2.60) $
0.03
Weighted average shares
outstanding 4,685 4,549 4,665
3,850
NOTE: EPS for each quarter are based upon on the weighted average of
shares outstanding for each period and the sum of quarters may not
necessarily be equal to the full year.
MIDISOFT CORPORATION
BALANCE SHEETS
(In thousands)
ASSETS
December 31,
Audited
1995 1994
Current assets:
Cash and cash equivalents $2,143 $ 9,601
Short term investments 1,540 -
Accounts receivable 2,329 3,844
Inventories 494 679
Prepaid and other expenses 266 276
Deferred income taxes - 283
Total current assets 6,772 14,683
Property & equipment 562 447
Capitalized software and
other costs, net 1,230 1,634
Total assets $8,564 $16,764
LIABILITIES & SHAREHOLDERS' EQUITY
December 31,
1995 1994
Current liabilities:
Trade accounts payable $ 429 $ 467
Accrued wages & payroll taxes 260 140
Other accrued expenses 1,804 115
Deferred revenue 807 785
Total current liabilities 3,300 1,507
Deferred income taxes - 291
Shareholders' equity
Common stock 17,106 14,676
Retained earnings (deficit) (11,842) 290
Total shareholders' equity 5,264 14.966
Total liabilities and
shareholders' equity $ 8,564 $16,764
CONTACT: Midisoft Corporation
Melinda Bryden, CFO
(206) 391-3610 (ext. 440)
or
MIDI'S INVESTOR RELATIONS COUNSEL:
The Equity Group Inc.
Tamara Ehlin (212) 836-9607
Robert Goldstein (212) 371-8660
SEATTLE, Feb. 29, 1996 - The Internal Revenue Service is
pleased with the Department of Justice's announcement of its
intention to vigorously enforce bankruptcy laws by prosecuting
individuals who file fraudulent bankruptcy petitions.
Nationwide, bankruptcy filings have more than tripled from
300,000 in 1980 to approximately 1,000,000 in 1994. The increase in
bankruptcy filings has also resulted in a correlative increase in
fraudulent bankruptcy filings. The Executive Office for the United
States Trustees estimates that 10 percent of bankruptcy filings
involve some type of fraud.
Each year fraudulent bankruptcy filings cost U.S. taxpayers
millions of dollars in uncollectible taxes. In an effort to protect
tax revenues, the Internal Revenue Service has focused its attention
on the growing bankruptcy fraud issue. In Washington state the
Examination and Collection Divisions are keeping alert to and
reporting potential illegal activity relating to questionable
bankruptcy filings to the Internal Revenue Service's Criminal
Investigation Division. In addition, professionals who willfully
assist debtors in filing false bankruptcy petitions will also be
pursued.
"Debtors who file bankruptcy and do not accurately report assets
or otherwise defraud creditors impacts everyone. As taxpayers we
expect everyone to pay their fair share and these persons may not.
As citizens, anyone able to get out of paying their debts results in
the costs of those lost debts being added to the costs of goods
sold. So everyone pays for the bankruptcy bad debts somehow," says
Judy Monahan, IRS spokesperson in the Seattle District.
CONTACT: Judy Monahan of the Internal Revenue Service,
206-220-5782
HOUSTON, Feb. 29, 1996 - Wainoco Oil Corporation (NYSE:
WOL) announced the results of its operations for the full year and
fourth quarter of 1995. A loss of $7.1 million was incurred in the
fourth quarter including a charge of $1.7 million related to a
corporate reorganization resulting in a net loss for 1995 of $19.1
million ($.70 per share). In 1994, Wainoco reported a net loss of
$12.6 million ($.46 per share). In the fourth quarter of 1994 the
loss was $18.7 million which included a $17.3 million charge
relating to the termination of its U.S. E & P business.
For 1995, Wainoco's operating income before depreciation and the
fourth quarter charge was $24.1 million, compared to $51.4 million
in 1994. Refining operations contributed $10.0 million and oil and
gas operations contributed $16.8 million, of which $12.4 million was
generated by Canadian operations. The comparable numbers were $30.7
million, $23.3 million and $16.3 million, respectively, in 1994.
Operating income was $1.0 million versus $7.4 million for 1994.
Cash flow from operations before changes in working capital was $3.0
million in 1995 compared to $31.8 million in 1994.
Wainoco's poor financial results in 1995 were due to the lowest
refining operating margins in nine years at Frontier and the
collapse of natural gas prices in Canada. Our average product
spread dipped from $5.88 per sales bbl in 1994 to $4.03 in 1995 and
Canadian gas prices dipped from $1.31 (C$1.79) per mcf in 1994 to
$.90 (C$1.24) in 1995.
On the positive side, the refinery ran at the highest rate it
has ever achieved and posted an 8 percent reduction in operating
costs per barrel. The Company's focus on crude oil exploration in
1995 resulted in the discovery of 1.3 million bbls of oil, replacing
442 percent of its liquids production. Its finding cost for the
year was $3.42 per boe and its finding and development cost was
$4.50 per boe. Also, Wainoco's total debt at year end was $146
million, $25 million lower than year end 1994 and the company had no
bank debt. Additionally, the reorganization announced in December
1995 will reduce general and administrative expense by approximately
$2.5 million beginning in 1996.
Wainoco Oil Corporation is a North American oil and gas
exploration, production and refining company with operations in the
United States and western Canada. Wainoco's common shares are
listed on the New York Stock and Alberta Stock Exchanges under the
symbol "WOL".
WAINOCO OIL CORPORATION
Year Ended Three Months Ended
December 31, December 31,
1995 1994 1995 1994
FINANCIAL (Financial information in thousands except per share)
Revenues
Refining Operations $ 331,953 $ 313,187 $ 84,608 $ 81,840
Oil and Gas Operations
- Canada 21,096 24,133 4,821 5,640
Oil and Gas Operations
- United States 9,817 16,395 1,297 3,941
Total 362,745 353,715 90,736 91,421
Operating income before
depreciation and fourth
quarter charge
Refining Operations 10,013 30,721 2,550 5,747
Oil and Gas Operations
- Canada 12,378 16,272 2,213 3,685
Oil and Gas Operations
- United States 4,377 7,004 395 1,998
Total 24,120 51,394 4,569 10,650
Operating income (loss)
Refining Operations 1,542 23,019 337 3,746
Oil and Gas Operations
- Canada 2,737 6,145 25 1,172
Oil and Gas Operations
- United States (623) (19,206) (1,900) (17,655)
Total 1,008 7,355 (2,127) (13,517)
Net loss (19,125) (12,607) (7,069) (18,695)
Loss per share (.70) (.46) (.26) (.68)
Net cash provided by
operating activities
before changes in
working capital 3,020 31,816 500 6,563
Net cash provided by
operating activities 9,878 32,108 9,867 13,781
Average shares
outstanding 27,254 27,335 27,256 27,250
Average exchange rate
(US$/C$) .7290 .7322 .7380 .7308
OIL AND GAS
Oil production (bbls)
- Canada 284,000 224,000 87,000 52,000
- United States 409,000 696,000 77,000 166,000
Gas production (mmcf)
- Canada 15,359 15,325 3,511 3,972
- United States 593 2,993 96 775
Average oil price ($/bbl)
- Canada 14.46 12.80 14.58 13.62
- United States 15.94 14.99 15.76 15.55
Average gas price
(Canadian$/mcf) 1.24 1.79 1.22 1.55
REFINING (bpd)
Total charges 40,344 37,295 41,230 39,581
Gasoline yields 17,263 16,106 17,903 16,806
Distillate yields 13,744 13,094 15,125 14,906
Total sales 40,813 38,789 41,960 40,702
RESERVES (At year end) Canada United States
1995 1994 1995 1994
Oil (mbbls) 2,352 1,308 - 3,284
Gas (bcf) 112.7 120.9 - 35.3
Pretax future net income at constant
prices, discounted at 10 percent
(in thousands) $ 63,852 $ 68,865 - $ 36,020
KEY TERMS
bbl barrel
bpd barrel per day
mbbls thousand barrels
mcf thousand cubic feet
mmcf million cubic feet
bcf billion cubic feet
PHILADELPHIA, Feb. 29, 1996 - The following was issued by
the U.S. Attorney's Office, Eastern District of Pennsylvania:
A Bucks County racehorse owner and trainer has been indicted by
a federal grand jury for mail fraud in connection with the alleged
killing of one of his racehorses, and five counts of bankruptcy
fraud.
The indictment was announced today (Feb. 29, 1996) by Michael R.
Stiles, U.S. Attorney, Eastern District of Pennsylvania; John R.
Stonitsch, Acting United States Trustee, and Bob C. Reutter, Special
Agent in Charge, Federal Bureau of Investigation.
It is part of a nationwide campaign called "Operation Total
Disclosure" launched today by Attorney General Janet Reno that is
aimed at prosecuting people who illegally conceal assets, file
fraudulent bankruptcy petitions, or otherwise abuse the bankruptcy
system.
The indictment charges Robert P. Deo, DOB: 3/14/58, of
Buckingham, Bucks County, PA, with five counts of concealment of
bankruptcy estate assets and false statements in bankruptcy
proceedings, and one count of mail fraud.
According to the indictment, the mail fraud arises from a scheme
to defraud the Lloyds Livestock Insurance Company of London,
England, of approximately $75,000 in insurance proceeds on the death
of a racehorse Deo owned named "Oblige."
Oblige, the indictment charges, had a promising racing career.
But in the spring of 1994, the horse was plagued by lameness and was
no longer a profitable investment for Deo, who then took various
measures to kill the horse and collect on the insurance.
In the spring and early summer of 1994, Deo tried to enlist
someone at Philadelphia Park to make Oblige "disappear." He then
tried to poison the horse by causing it to ingest turpentine. And
he routinely tried to break the horse down by continuing to run it
while it was lame and sore.
Finally, according to the indictment, on June 15, 1994, Oblige
was stricken with an acute painful and massive infection of the
foreleg that resulted from the lethal introduction of E Coli
bacteria (commonly found in fecal matter) into the horse's knee
joint.
Deo, the indictment charges, was responsible for causing this
fatal infection. Oblige was euthanized on June 22, 1994, when
veterinarians could not save the animal.
Deo is also charged with filing for bankruptcy and concealing
his assets - four thoroughbred racehorses including Oblige - from
the Bankruptcy Court and his creditors.
Deo created a sham corporation called "Zeus Equestrian" and
transferred the horses to this corporation. Deo, however,
maintained defacto ownership and control over the animals, the
indictment charges.
In the bankruptcy proceedings, Deo failed to identify the horses
as assets, or otherwise disclose them in the financial papers filed
with the court.
The indictment reflects increased attention by law enforcement
authorities in this district to bankruptcy fraud in recent years.
Prosecutions have ranged from debtors such as Ronald Galati, who
received a four-year sentence after being convicted of racketeering
and providing false information to the bankruptcy trustee, to
attorneys and trustees such as David Fishbone, a Philadelphia
bankruptcy attorney who pleaded guilty and received a 53-month
sentence for embezzling $2.24 million from bankrupt estates in the
largest embezzlement case ever brought against a bankruptcy
attorney.
The United States Trustee's Office also has been actively
involved in pursuing affirmative legal action against "bankruptcy
petition preparers" who assist debtors in preparing bankruptcy
petitions for a fee.
Action is taken in these cases in order to prevent
unsophisticated individual debtors from being victimized by the
unscrupulous and illegal practices of many "bankruptcy petition
preparers."
As a result of the efforts of the United State Trustee's Office,
the Bankruptcy Court has enjoined numerous petition preparers from
continuing to assist debtors in filing bankruptcy cases.
In one such case, United State Trustee v. Legal Aid Services,
the United State Trustee was successful in obtaining a nationwide
injunction against the defendant and having the court impose civil
penalties against the defendant.
The Legal Aid Services case is noteworthy because it was one of
the first cases in which relief was obtained under the newly enacted
Bankruptcy Code Section 110, which now authorizes the Bankruptcy
Courts to regulate the conduct of non-attorneys who assist debtors
in filing bankruptcy.
In announcing "Operation Total Disclosure," the Attorney General
said, "Our economy depends on there being a trustworthy system that
protects lenders and is fair to everyone. Bankruptcy fraud
victimizes all of us."
As of Sept. 30, 1995, there were 883,000 bankruptcy cases
pending in the nation's federal courts, involving $7 billion in
assets and several times that in claims. Among the largest
creditors is the U.S. Treasury which is owed more than $12 billion.
The Deo case was handled by Assistant U.S. Attorney Suzanne B.
Ercole. Joesph Minni, Senior Staff Attorney, United States Trustees
Office, assisted in the case. The Thoroughbred Racing Protective
Bureau assisted in the investigation.
CONTACT: Fred Hamilton, public affairs officer of the U.S.
Attorney's Office, 215-451-5636