MIDCOM Files Chapter 11 to Protect Assets, Company In Talks With Various Buyers.SOUTHFIELD, Mich.--(BUSINESS WIRE)--Nov. 7, 1997--MIDCOM Communications Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :MCCI MCCI Molten Core Concrete Interaction MCCI Molten Corium-Concrete Interaction MCCI Mandaluyong Chamber of Commerce and Industry MCCI Multi-Channel Communications Interface MCCI Motor Carrier Consultants, Inc. ) today announced that it has filed a petition for relief under Chapter 11 of the Bankruptcy Code Bankruptcy Code may refer to:
The company also indicated that it will continue to pursue possible investment and other strategic alternatives, including a merger, partnership, or sale of the company, as previously announced. "Filing for protection from its creditors allows MIDCOM MIDCOM Middlebox Communication (IETF draft for NAT/firewall transversal) time to continue investment and sales discussions that have already begun," said William H. Oberlin, president and chief executive officer for MIDCOM. "We recognize that it is important for us to be able to continue to serve our customers, thereby protecting the on-going value of our business, and we believe Chapter 11 will afford us the time we need to thoroughly investigate and pursue the options available to us." On October 31, 1997, the company announced that it did not have sufficient resources to satisfy its current obligations. A Chapter 11 filing allows the company to continue operations in the normal course of business, while obtaining relief from the immediate collection of its obligations owed to existing creditors. The company also announced additional efforts to operate more efficiently, including layoffs of 170 of its 790 total employees, as well as other cost savings. In addition, the company has arranged for debtor-in-possession financing Debtor-in-possession financing New debt obtained by a firm during the Chapter 11 bankruptcy process, Federal Bankruptcy Rule 4001 (c)(1). This financing is unique because it is secured, that is, it has priority over existing debt, equity and other claims. from its lender, Foothill Capital of approximately $10 million, which, with the on-going support of its employees and vendors, will permit the company to continue normal operations Generally and collectively, the broad functions that a combatant commander undertakes when assigned responsibility for a given geographic or functional area. Except as otherwise qualified in certain unified command plan paragraphs that relate to particular commands, "normal operations" of . In that regard, MIDCOM's customers will not experience any interruption in their service as a result of the filing. Related Chapter 11 petitions were also filed in the same court for PacNet Inc., Cel-Tech International Corporation and AdVal, Inc., all wholly owned subsidiaries Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of MIDCOM. The companies are being represented by Barbara Rom of Pepper, Hamilton & Scheetz located in Detroit, Mich. Founded in 1989, MIDCOM provides a broad range of telecommunications services to small and medium-sized businesses nationwide. The company has regional offices throughout the nation and currently invoices approximately 100,000 customer locations monthly. CONTACT: MIDCOM Communications Inc. Teresa C. Stackpole, 206/574-3152 |
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