EXHIBIT 99.1
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UNITED COMPANIES RECEIVES APPROVAL FOR MODIFIED
DISCLOSURE STATEMENT AND CONDUCTS AUCTION OF ASSETS
BATON ROUGE, LA - August 18, 2000. United Companies Financial Corporation
(OTC:UCFNQ) announced that, in connection with the chapter 11 cases of United
Companies and certain of its subsidiaries, which cases are pending in the U.S.
Bankruptcy Court for the District of Delaware in Wilmington, the Bankruptcy
Court approved the Debtors' Modified Disclosure Statement and modified form of
ballots in connection with the Debtors' Third Amended Plan of Reorganization.
The Debtors have retained an Information Agent to respond to inquiries regarding
the Debtors' Plan and the submission of ballots. The Information Agent can be
reached at 888-559-9367. For voting purposes and mailing of notices, June 30,
2000 shall be the Record Holder Date for the holders of claims and interests.
The deadline for the Balloting Agent's receipt of ballots is 4:00 PM Eastern
time on September 11, 2000. A hearing to consider confirmation of the plan of
reorganization is scheduled to commence on September 13, 2000. As previously
announced, United Companies reached an agreement with a representative of the
holders of Subordinated Debenture Claims and the Official Committee of Equity
Security Holders to support its modified plan of reorganization.
As previously announced, the Company signed an Asset Purchase Agreement and a
Mortgage Loan and REO Property Purchase Agreement for the sale of substantially
all of its whole loan portfolio and REO properties, assets related to its
mortgage servicing operations and its interest only and residual interests as of
December 31, 1999, to EMC Mortgage Corporation and EMC Mortgage Acquisition
Corp., subsidiaries of The Bear Stearns Companies, Inc., for an aggregate cash
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purchase price of approximately $781 million, subject to adjustments, plus the
assumption of certain liabilities. Today, the Company also announced that,
pursuant to bidding procedures previously approved by the Bankruptcy Court, EMC
was the successful bidder with an overall increased bid amount of approximately
$65 million. A Bankruptcy Court hearing to approve the sale of assets pursuant
to the Asset Purchase Agreement is scheduled for August 30, 2000. The Bankruptcy
Court approved the sale of the Company's whole loan portfolio and REO properties
on August 15, 2000.
"We believe that these transactions, and the Bankruptcy Court approval process,
have allowed the Company to maximize its value and substantially complete its
reorganization efforts. We look forward to working with the EMC organization to
ensure an orderly transfer of servicing for our home equity loans," said
Lawrence Ramaekers, Chief Executive Officer of United Companies.
United Companies Financial Corporation is a specialty finance company that
historically provided consumer loan products nationwide and currently provides
loan services through its lending subsidiary, UC Lending(R). The Company filed
for chapter 11 on March 1, 1999.
The following is a "Safe Harbor"' Statement under the Private Securities
Litigation Reform Act of 1995: The statements contained in this release that are
not historical facts are forward-looking statements based on the Company's
current expectations and beliefs concerning future developments and their
potential effects on the Company. There can be no assurance that future
developments affecting the Company will be those anticipated by the Company.
Actual results may differ from those projected in the forward-looking
statements. These forward-looking statements involve significant risks and
uncertainties (some of which are beyond the control of the Company) and are
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subject to change based upon various factors, including but not limited to the
following risks and uncertainties: the developments in and outcome of the
Company's Chapter 11 reorganization proceedings; the ability to access loan
facilities in amounts necessary to fund the Company's operations; the successful
disposition of its existing loan portfolio and repossessed real estate
properties; the ability of the Company to successfully restructure its balance
sheet; the ability of the Company to retain an adequate number and mix of its
employees; the effect of the Company's policies including the amount of Company
expenses; actual prepayment rates and credit losses on loans sold as compared to
prepayment rates and credit losses assumed by the Company at the time of sale
for purposes of its gain on sale computations; the quality of the Company's
owned and serviced loan portfolio including levels of delinquencies, customer
bankruptcies and charge-offs; adverse economic conditions; competition; various
legal, regulatory and litigation risks and other risks detailed from time to
time in the Company's Securities and Exchange Commission filings. The Company
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as the result of new information, future events or
otherwise.
