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Previous: DELTEC INTERNATIONAL SA, 4, 1998-03-06 |
Next: TRANSAMERICA INVESTORS INC, N-30D, 1998-03-06 |
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
February 25, 1998
------------------------------------------------
Date of Report (Date of earliest event reported)
MC Liquidating Corporation
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Washington 000-26118 91-1438806
---------- ----------- ----------
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
26899 Northwestern Highway, Suite 120, Southfield, MI 48034
-----------------------------------------------------------
(Address of principal executive offices)
(248) 304-1780
----------------------------------------------------
(Registrant's telephone number, including area code)
MIDCOM Communications Inc.
--------------------------
(Former Name)
<PAGE>
ITEM 5. OTHER EVENTS.
The Company's financial and operating report for the month of November 1997
filed with the U.S. Trustee and Bankruptcy Court administering the Company's
bankruptcy pursuant to Rule 2015 of the Federal Rules of Bankruptcy is filed as
Exhibit 99.1 to this report.
On February 25, 1998 the Company completed the previously disclosed sale to
DICOMM Ventures of the assets of the Company's Enhanced Facsimile and Electronic
Messaging subsidiary, AdVal, Inc., pursuant to an asset purchase agreement dated
January 15, 1998. DICOMM Ventures of Lynn, Massachusetts is a private
investment company that invests in information technology and telecommunications
companies. DICOMM paid $6.6 million for these assets, subject to a hold back in
escrow of approximately $1 million to satisfy certain possible adjustments. The
bankruptcy court had approved the terms of the sale to DICOMM on February 3,
1998.
With the disposition of the assets of AdVal and the previously disclosed sale of
substantially all of the Company's other assets to WinStar Communications, Inc.
for approximately $92 million (subject to possible offsets by the buyer), the
Company continues negotiations for the sale of its remaining operating assets,
which consist principally of conference call customer accounts representing
revenue of approximately $40,000 on a monthly basis and the microwave network of
the Company's wholly-owned subsidiary, PacNet, Inc.
The proceeds from the sales of the Company's assets, net of transaction and
administration costs, will be applied to satisfaction of creditor claims in
accordance with a plan of liquidation which is being prepared for approval by
the bankruptcy court. Net proceeds will not be sufficient to satisfy in full
unsecured creditors' claims, including sums owed to holders of the Company's
Convertible Subordinated Notes due 2003. Nor will such proceeds be sufficient to
provide any distribution in liquidation to the holders of shares of the
Company's common stock.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
99.1 November 1997 Monthly Financial and Operating
Report filed with Bankruptcy Court
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: March 6, 1998 MC Liquidating Corporation
By: /s/ Kevin J. Smith
-----------------------------
Kevin J. Smith, President
and Chief Executive Officer
<PAGE>
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
99.1 Monthly Financial and Operating Report filed with Bankruptcy
Court
</TABLE>
<PAGE>
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
BALANCE SHEET
AS OF NOVEMBER 30, 1997
(000)
<TABLE>
<CAPTION>
MIDCOM PACNET CELTECH ADVAL* ELIM CONSOL
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
- ------
CURRENT ASSETS:
- --------------
Cash $ 3,000 $ (335) $ 24 $ - $ - $ 2,689
Inter-Company Receivable 14,664 - 4,746 - (19,410) -
Related Party A/R 180 - - - - 180
Account Receivable (Net) 20,924 1,798 284 - - 23,006
Prepaid and Other Current Asset 1,747 153 54 - - 1,954
---------- ------- ------- ----- ---------- ---------
TOTAL CURRENT ASSETS 40,515 1,616 5,108 - (19,410) 27,829
FIXED ASSETS:
- ------------
Equipment, Furniture and
Fixture, Lease Improvements 33,713 6,654 91 - - 40,458
Accum Depreciation (10,420) (3,133) (38) - - (13,591)
---------- ------- ------- ----- ---------- ---------
NET FIXED ASSETS 23,293 3,521 53 - - 26,867
OTHER ASSETS:
- ------------
Investment in Subs 1,014 - - - (1,014) -
Intangible Assets (Net) 5,123 - - - - 5,123
Other Assets 681 - 2 - - 683
---------- ------- ------- ----- ---------- ---------
TOTAL OTHER ASSETS 6,818 - 2 - (1,014) 5,806
TOTAL ASSETS $ 70,626 $ 5,137 $ 5,163 $ - $ (20,424) $ 60,502
---------- ------- ------- ----- ---------- ---------
LIABILITIES:
- -----------
POST PETITION LIABILITIES:
- -------------------------
Accounts Payable $ 280 $ 783 $ 33 $ - $ - $ 1,096
Secured Line of Credit 5,803 - - - - 5,803
Notes Payable - - - - - -
Rents and Leases Payable 188 - - - - 188
Taxes Payable 987 58 28 - - 1,073
Accrued Interest - - - - - -
Inter-company Payables 102 470 176 - (748) -
Accrued Expenses 1,285 (19) 8 - - 1,274
---------- ------- ------- ----- ---------- ---------
TOTAL POST PETITION LIABILITIES 8,645 1,292 245 - (748) 9,434
PRE PETITION LIABILITIES:
- ------------------------
Secured Line of Credit 21,426 - - 21,426
Notes Payable 113,740 3,150 - - (3,150) 113,740
Capital Leases 16,009 - - - 16,009
Utility Taxes Payable 2,245 126 2 - - 2,373
Accounts Payable 32,419 3,490 472 - 36,381
Accrued Expenses 12,423 252 18 - (6) 12,687
Other Current Liabilities 4,065 19 8 - - 4,092
Intercompany Payable 15,295 (146) 3,513 - (18,662) -
---------- ------- ------- ----- ---------- ---------
TOTAL PRE PETITION LIABILITIES 217,622 6,891 4,013 - (21,818) 206,708
TOTAL LIABILITIES 226,267 8,183 4,258 - (22,566) 216,142
OWNERS' EQUITY:
- --------------
Capital Stock and Paid-in Capital 66,955 100 6 500 67,561
Retained Earnings:
Pre-petition (216,864) (3,111) 908 1,642 (217,425)
Post-petition (5,732) (35) (9) - - (5,776)
---------- ------- ------- ----- ---------- ---------
TOTAL OWNERS' EQUITY (155,641) (3,046) 905 - 2,142 (155,640)
TOTAL LIABILITIES AND
OWNERS EQUITY $ 70,626 $ 5,137 $ 5,163 $ - $ (20,424) $ 60,502
---------- ------- ------- ----- ---------- ---------
*Included in MIDCOM Balances. 0 - - - - 0
</TABLE>
<PAGE>
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
INSURANCE COVERAGE
NOVEMBER-1997
- ----------------------------------
MIDCOM/PACNET/ADVAL/CELTECH
- ----------------------------------
<TABLE>
<CAPTION>
Policy Premium
Expiration Paid Through
Type: Policyholder/Policy Number Date Date
- ---- -------------------------- ---- ----
<S> <C> <C> <C>
Property/Liability/Computerized CIGNA/ GPP D 33524791 5/1/98 1/31/98
Business Equipment/Crime/Auto
Package Policy- Texas Only CIGNA/ TCP 33908611 5/1/98 5/1/98
Umbrella Indemnity Insurance Co of NA/ 5/1/98 5/1/98
XOO G1882140A
Difference in Conditions including RLI Insurance Co/ IMF 024737 6/18/98 6/18/98
Earthquake and Flood
Directors & Officers Liability National Union Fire Ins Co./ 1/24/00 6/24/98
4848235
Directors & Officers - Genesis Indemnity Ins Co/ 6/8/98 6/8/98
Prospectus Liability ZXB 000837
Financial Guarantee Bond Contractors Bonding and until cancelled 2/13/98
Insurance Co/ FL 2183
Workers' compensation Insurance Hartford Fire Insurance Co/ 11/1/98 1/31/98
52WBEM6171
</TABLE>
<PAGE>
PACNET
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
INSURANCE COVERAGE
November 97
- ------------------
PACNET
- ------------------
<TABLE>
<CAPTION>
Policy Premium
Expiration Paid Through
Type: Policyholder/Policy Number Date Date
- ----- -------------------------- ---- ----
<S> <C> <C> <C>
Property/Liability/Computerized CIGNA/ GPP D 33524791 5/1/98 1/31/98
Business Equipment/Crime/Auto
Package Policy- Texas Only CIGNA/ TCP 33908611 5/1/98 5/1/98
Umbrella Indemnity Insurance Co of NA/ 5/1/98 5/1/98
XOO G1882140A
Difference in Conditions including RLI Insurance Co/ IMF 024737 6/18/98 6/18/98
Earthquake and Flood
Directors & Officers Liability National Union Fire Ins Co./ 1/24/00 6/24/98
4848235
Directors & Officers - Genesis Indemnity Ins Co/ 6/8/98 6/8/98
Prospectus Liability ZXB 000837
Financial Guarantee Bond Contractors Bonding and until cancelled 2/13/98
Insurance Co/ FL 2183
Workers' compensation Insurance Hartford Fire Insurance Co/ 11/1/98 1/31/98
52WBEM6171
</TABLE>
<PAGE>
CELTECH
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
INSURANCE COVERAGE
NOVEMBER-97
- ----------------------------------
CELTECH
- ----------------------------------
<TABLE>
<CAPTION>
Policy Premium
Expiration Paid Through
Type: Policyholder/Policy Number Date Date
- ---- ------------------------- ---- ----
<S> <C> <C> <C>
Property/Liability/Computerized CIGNA/ GPP D 33524791 5/1/98 1/31/98
Business Equipment/Crime/Auto
Package Policy- Texas Only CIGNA/ TCP 33908611 5/1/98 5/1/98
Umbrella Indemnity Insurance Co of NA/ 5/1/98 5/1/98
XOO G1882140A
Difference in Conditions including RLI Insurance Co/ IMF 024737 6/18/98 6/18/98
Earthquake and Flood
Directors & Officers Liability National Union Fire Ins Co./ 1/24/00 6/24/98
4848235
Directors & Officers - Genesis Indemnity Ins Co/ 6/8/98 6/8/98
Prospectus Liability ZXB 000837
Financial Guarantee Bond Contractors Bonding and until cancelled 2/13/98
Insurance Co/ FL 2183
Workers' compensation Insurance Hartford Fire Insurance Co/ 11/1/98 1/31/98
52WBEM6171
</TABLE>
<PAGE>
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
<TABLE>
<CAPTION>
PROFIT AND LOSS STATEMENT
for the Period 11/8/97 through 11/30/97
(000)
MIDCOM PACNET CELTECH ADVAL ELIM CONSOL
------ ------ ------- ----- ---- ------
<S> <C> <C> <C> <C> <C> <C>
Net Revenue $ 4,371 $ 1,242 $ 153 $ - $ (51) $ 5,715
Cost of Revenue 3,242 849 87 - (34) 4,144
--------- -------- --------- ------- ------ --------
Gross Margin 1,129 393 66 - (17) 1,571
Operating Expenses:
Selling, General, and Administrative (Detail Attached) 5,092 349 76 - (17) 5,500
Depreciation 402 66 1 - - 469
Amortization 638 - - - - 638
--------- -------- --------- ------- ------ --------
Total Operating Expenses 6,132 415 77 - (17) 6,607
--------- -------- --------- ------- ------ --------
Operating Loss (5,003) (22) (11) - - (5,036)
Other Expense (Income):
Interest Expense, Net 680 14 - - - 694
Other Expense (Income), Net - - - - - -
--------- -------- --------- ------- ------ --------
680 14 - - - 694
Loss Before Provision for Income Taxes (5,683) (36) (11) - - (5,730)
Provision for Income Taxes - - - - - -
--------- -------- --------- ------- ------ --------
Net Loss $ (5,683) $ (36) $ (11) $ - $ - $ (5,730)
========= ======== ========= ======= ====== ========
</TABLE>
<PAGE>
MIDCOM/ADVAL
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
TAXES PAYABLE SCHEDULE
for the Period 11/8/97 through 11/30/97
(000)
<TABLE>
<CAPTION>
Beginning Payments/ Ending
Balance Additions Deposits Balance
- -------------------------- ------- --------- -------- -------
MIDCOM/ADVAL
- --------------------------
<S> <C> <C> <C> <C>
Income Tax Withheld:
Federal $0 $0 $0 $0
State 0 0 0 0
Local 0 0 0 0
FICA Tax Withheld 0 0 0 0
Employer's FICA Tax 0 0 0 0
Unemployment Tax:
Federal 0 0 0 0
State 0 0 0 0
Sales Use & Excise Tax 2,867,372.59 550,557.16 (348,085.55) 3,069,844.20
Accrued Income Tax:
Federal - - - -
State - - - -
Other 179,029.79 19,400.90 (36,229.56) 162,201.13
Total 3,046,402.38 569,958.06 (384,315.11) 3,232,045.33
============ ========== ============ ============
</TABLE>
Page 1
<PAGE>
PACNET
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-5
Chapter 11 97-59962-6
97-59084-G
97-59057-5
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
TAXES PAYABLE SCHEDULE
for the Period 11/8/97 through 11/30/97
(000)
<TABLE>
<CAPTION>
Beginning Payments/ Ending
Balance Additions Deposits Balance
------- --------- -------- -------
<S> <C> <C> <C> <C>
- ----------------------
PACNET
- ----------------------
Income Tax Withheld:
Federal $ 0 $ 0 $ 0 $ 0
State 0 0 0 0
Local 0 0 0 0
FICA Tax Withheld 0 0 0 0
Employer's FICA Tax 0 0 0 0
Unemployment Tax:
Federal 0 0 0 0
State 0 0 0 0
Sales Use & Excise Tax 177,558.14 57,193.01 (51,807.07) 182,944.08
Accrued Income Tax:
Federal - - - -
State - - - -
Other 913.62 259.50 - 1,173.12
---------- --------- ----------- ----------
Total 178,471.76 57,452.51 (51,807.07) 184,117.20
---------- --------- ----------- ----------
</TABLE>
<PAGE>
CELTECH
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
TAXES PAYABLE SCHEDULE
for the Period 11/8/97 through 11/30/97
(000)
<TABLE>
<CAPTION>
Beginning Payments/ Ending
Balance Additions Deposits Balance
- ---------------------- ------- --------- -------- -------
CELTECH
- ----------------------
<S> <C> <C> <C> <C>
Income Tax Withheld:
Federal $0
State 0 $0 $0 $0
Local 0 0 0 0
FICA Tax Withheld 0 0 0 0
Employer's FICA Tax 0 0 0 0
Unemployment Tax: 0 0 0
Federal 0 0 0 0
State 0 0 0 0
Sales Use & Excise Tax 32,181.96 27,320.27 (31,424.94) 28,077.29
Accrued Income Tax:
Federal - - - -
State - - - -
Other 2,089.16 1,253.71 (1,076.25) 2,266.62
--------- --------- ----------- ---------
Total 34,271.12 28,573.98 (32,501.19) 30,343.91
========= ========= =========== =========
</TABLE>
Page 1
<PAGE>
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
- -----------------------------------
Debtor(s) Hon. Walter Shapero
STATEMENT OF DEBTOR IN POSSESSION
UNDER BANKR.R.PRO.9011
FOR THE MONTH OF NOVEMBER, 1997
The Debtor in Possession states:
Attached is a complete and accurate (check appropriate lines).
----------------------
X Balance Sheet
---
X Profit and Loss Statement
---
X Cash Receipts & Disbursements Report
---
X Accounts Payable Aging Schedule
---
X Taxes Payable/Insurance Schedule
---
X Reconciled Bank Statements
---
The statements contained within have been completed on a accrual basis. I
understand that any false statement may subject me to sanctions as provided for
in Bankr. R. Pro. 9011.
____________________________
Debtor In Possession
William H. Oberlin
President and Chief Executive Officer
Date
A. Mail the original to: Mail one copy of this report to:
UNITED STATES BANKRUPTCY COURT OFFICE OF THE U.S. TRUSTEE
1003 FEDERAL BUILDING 477 MICHIGAN AVENUE
231 W. LAFAYETTE SUITE 1760
DETROIT, MICHIGAN 48226 DETROIT, MICHIGAN 48226
B. Mail a copy of this report to each member of the Creditors' Committee (if
any) and the attorney for the Creditors' Committee (if any).
<PAGE>
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
- -----------------------------------
Debtor(s) Hon. Walter Shapero
AFFIRMATIONS
UNDER BANKR.R.PRO.9011
As Debtor in Possession, I affirm:
1. That the insurance, as described in section 5 of the Notice of Operating
Instructions and Reporting Requirements, is in effect, and
2. That all post petition taxes, as described in section 9 of the Notice of
Operating Instructions and Reporting Requirements, are current.
3. No professional fees (accountant, attorneys, etc.) have been paid without
specific court authorization.
I understand that any false statement may subject me to sanctions as provided
for in Bankr. R. Pro. 9011.
__________________________________________________
Debtor In Possession
William H. Oberlin
President and Chief Executive Officer
Date
<PAGE>
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF MICHIGAN
In the matter of: Case Number: 97-59044-S
Chapter 11 97-59052-G
97-59064-G
97-59057-S
MIDCOM Communications, Inc.
PacNet Inc.
AdVal Inc.
Cel-Tech International Corp. /
Debtor(s)
STATEMENT OF CASH FLOW
for the Period 11/8/97 through 11/30
(000)
<TABLE>
<CAPTION>
- ----------------------------------------------------
OPERATING ACTIVITIES:
- ----------------------------------------------------
<S> <C> <C>
Net Income $ (5,730)
Non-cash charges/credits to income:
Depreciation 468
Amortization of Intangibles 638
Accounts Receivable (936)
Prepaid Expenses 60
Other Assets 30
Accounts payable/Accrued Expenses 1,789
-----
Cash provided by (used in) operations (3,681)
- ----------------------------------------------------
INVESTING ACTIVITIES:
- ----------------------------------------------------
Purchases of Plant and Equipment 286
---
Cash used in investing activities 286
- ----------------------------------------------------
FINANCING ACTIVITIES:
- ----------------------------------------------------
Proceeds from Foothill Borrowings 10,408
Repayment of Foothill Borrowings (5,068)
Issuance of Stock Options 29
--
Cash provided by (used in) financing activities 5,369
Increase (decrease) in cash 1,974
Cash at beginning of period $ 715
Cash at end of period $ 2,689
</TABLE>
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