- Groups Representing All Senior Noteholders Agree to Plan
- Company Appoints Robert T. Blakely as Chief Financial Officer
- Moves Corporate Headquarters to Ashburn, Va.
ASHBURN, Va., April 14 /PRNewswire-FirstCall/ -- WorldCom, Inc.
(WCOEQ, MCWEQ) today filed its proposed Plan of Reorganization with the U.S.
Bankruptcy Court for the Southern District of New York, delivering on the
company's "fast track" Chapter 11 reorganization schedule. Additionally, the
company announced the appointment of Robert T. Blakely as its new CFO, a brand
name change to MCI, and the relocation of its corporate headquarters to
Ashburn, Va.
"We committed to file our Plan of Reorganization by April 15 and we
delivered," said MCI's Chairman and CEO Michael Capellas. "Today's
accomplishments are a tribute to our management team, advisors and major
creditor constituencies. It is also an example of the tremendous will-to-win
of the MCI employees, who worked with an outrageous sense of urgency."
"Our company has demonstrated a new fast and focused attitude and a
commitment to emerge from Chapter 11 later this year as a leaner, stronger
competitor," said Capellas. "From this day forward, our focus will be on
serving our customers, strengthening our core assets, executing on our
three-year business plan, and solidifying our position as the industry's
leading Internet Protocol communications provider."
Proposed Plan of Reorganization
Representatives of the company's senior noteholder groups have agreed upon
the economic terms of the proposed Plan. These groups represent a majority of
the company's Official Committee of Unsecured Creditors that hold in excess of
90 percent of the dollar value of the claims in the company's Chapter 11
cases. The terms of the proposed Plan substantively consolidate the estates
of the WorldCom and Intermedia entities, respectively, and reflect a
settlement of various litigation arguments each group could have asserted. As
part of the Plan, the company also agreed to a proposed capital structure for
the reorganized company that will include approximately
$3.5 billion-$4.5 billion in debt, net of cash.
Later today, the company will file a Disclosure Statement that explains
the details of the proposed Plan. The proposed Plan and the Disclosure
Statement will be available at the company's Restructuring Information Desk at
http://www.mci.com.
The company will request that a hearing on the adequacy of the Disclosure
Statement and related procedures to solicit votes in favor of the Plan be
scheduled by the Bankruptcy Court for May 19, 2003.
100-Day Plan Completed
Capellas and his team announced in January 2003 a 100-Day Plan, the
conclusion of which was today's filing. During the 100 days, the company
implemented a number of new corporate governance measures. The company
restructured its Board of Directors and installed a new leadership team. It
has an active Ethics Office that, among other things, is implementing ethics
and financial reporting training and enforcing a new Code of Ethics and
Business Conduct.
In March, the company became the first nationwide local phone company,
expanding its Neighborhood(SM) offering to 48 contiguous states and
Washington, D.C. Also, its integrated voice, data and Internet enterprise
offering, MCI Advantage(SM), more than doubled its reach to serve all 94 U.S.
metropolitan areas in which MCI has owned, local service facilities.
New CFO, Robert T. Blakely, Appointed
MCI appointed Blakely, who has served as Executive Vice President and
Chief Financial Officer of both Tenneco Inc. and Lyondell Chemical, to fill
its Chief Financial Officer position. Blakely recently competed a four-year
appointment as a member of the Financial Accounting Standards Advisory
Council, which advises the Financial Accounting Standards Board on issues
relating to full and complete financial reporting and disclosure. He also
served as a founding member of Standard & Spoor's Issuer Advisory Council.
"Bob's 30 years of experience and reputation for upholding the highest
standards will be a tremendous asset to MCI as we strive to regain trust with
customers, employees and the financial community," said Capellas. "His
background in accounting, internal controls, capital markets and general
management makes him the ideal executive to lead our finance organization,
help the emerge from Chapter 11 protection later this year, and work closely
with the investment community post-emergence."
Blakely will be based at MCI's corporate headquarters in Ashburn, Va.
Moving Forward with MCI Brand and Strategy
As part of its efforts to move forward, the company is unifying under a
new corporate banner -- MCI. The company's wholesale business will be
sub-branded as UUNET.
"We wanted a new name that would make us proud," said Capellas. "Once we
evaluated our branding options, we realized that we already had a
winner -- MCI. With established brand equity and a name that stands for
integrity, innovation and value, we're ready to regain our leadership position
in the marketplace."
The company will launch a global multi-media advertising campaign, which
begins today on U.S. television and in print and online throughout the U.S.,
Europe and Asia-Pacific. The campaign reinforces the company's three-year
business plan, which outlines initiatives to position the company as a leader
in the move toward convergence of local, long-distance and data services.
About WorldCom, Inc.
WorldCom, Inc. (WCOEQ, MCWEQ) is a leading global communications provider,
delivering innovative, cost-effective, advanced communications connectivity to
businesses, governments and consumers. With the industry's most complete
global IP backbone and one of the world's most expansive, wholly-owned data
networks, WorldCom develops the converged communications products and services
that are the foundation for commerce and communications in today's market. For
more information, go to http://www.mci.com.
Forward-Looking Statements
This press release includes certain "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. These
statements are based on management's current expectations and are subject to
uncertainty and changes in circumstances. Actual results may differ materially
from these expectations due to the company's bankruptcy proceedings and
matters arising out of pending class-action and other lawsuits and ongoing
internal and government investigations relating to the previously announced
restatement of its financial results. Other factors that may cause actual
results to differ materially from management's expectations include economic
uncertainty; the effects of vigorous competition, including price compression;
the impact of technological change on our business, alternative technologies,
and dependence on availability of transmission facilities; risks of
international business; regulatory risks in the United States and
internationally; contingent liabilities; uncertainties regarding the
collectibles of receivables; risks associated with debt service requirements
and our financial leverage; uncertainties associated with the success of
acquisitions; and the ongoing war on terrorism, including Operation Iraqi
Freedom. More detailed information about those factors is contained in the
company's filings with the Securities and Exchange Commission. We will
continue to file documents with the Securities and Exchange Commission under
the WorldCom, Inc. name until the effective date of the Plan of
Reorganization. The effective date will not occur until after the Bankruptcy
Court confirms the Plan of Reorganization.
Web Site: http://www.worldcom.com http://www.mci.com