Cerberus Partners Responds to Coram Equity Committee's Press Statement and Motion.

Business Editors

NEW YORK--(BUSINESS WIRE)--Feb. 12, 2001

In response to the Coram Healthcare Corporation (OTCBB:CRHEQ) Official Equity Committee's motion in the U.S Bankruptcy Court for the District of Delaware for authority to sue one of its largest debtholders, Cerberus Partners, L.P., Cerberus' principal, Stephen A. Feinberg and Coram's President and CEO Daniel Crowley, Mr. Feinberg said that the Committee's motion, and attendant press release, "reflect its intent to litigate in the press and attempt to extract value from debtholders for the benefit of well-heeled out-of-the money equity holders. We believe that certain equity holders who are driving the actions of the Equity Committee and its counsel purchased their equity securities after Coram's financial difficulties were well-known, with full knowledge of their lack of value and for the purpose of attempting to obtain value by resorting to aggressive litigation tactics."

"The Equity Committee's proposed complaint is replete with misstatements and omissions and irresponsibly ignores the extensive factual record made before the Bankruptcy Court. While the Bankruptcy Court declined to confirm Coram's initial plan of reorganization until it could address the question of whether the relationship between Cerberus and Mr. Crowley had any effect on Coram, the Court nevertheless confirmed that, even using the valuation proffered by the Equity Committee's expert, Coram is insolvent. The Equity Committee's draft complaint is devoid of any factual support for its allegations that Cerberus and Feinberg used Crowley to control Coram for their own benefit. The equity security holders were in no way harmed by any actions of Cerberus, members of the Board or Management. The Equity Committee's press release and draft complaint also ignore the fact that Coram's financial operations improved significantly under Mr. Crowley's stewardship."

"The Equity Committee's allegations that Coram and its Board failed to preserve stockholders' value are also false. The evidence is clear that before, during and after Dan Crowley's assumption of his role as consultant to Coram and thereafter as its CEO, the equity was underwater. The Equity Committee's assertion that Coram's CPS unit was sold 'far below' the value estimated by Coram's investment banker likewise ignores the plain and undisputed fact that the unit was widely shopped and yielded nearly $7 million more in value, and $16 million more in cash, than the best offer received by Coram's bankers, largely as a result of the efforts of Mr. Crowley."

"It is noteworthy that the debtholders had communicated to both the Equity Committee and persons believed to be affiliated with members of the Equity Committee an offer affording them the opportunity to buy the debt at a discount of over $60 million to allow them to capture the 'upside' that they allege Cerberus and the other debtholders were attempting to keep for themselves. The fact that this offer was refused speaks volumes and confirms that they place no value on the equity."

"Cerberus and the other debtholders remained fully committed to support Mr. Crowley and his efforts to complete the reorganization of Coram so that it can continue as a viable and important player in the home infusion care business. In fact, Cerberus and the other debtholders have taken the unprecedented step to converting over $120 million of their debt to preferred equity in advance of Coram's emergence from bankruptcy to ensure that Coram can satisfy certain regulatory requirements. In addition, we fully support the motion of the independent board members to retain Harrison J. Goldin to review the process leading to the commencement of Coram's chapter 11 case and all related matters, and we will cooperate fully with Coram, the independent board and Mr. Goldin."