Manchester, Inc. and Palm Beach Multi-Strategy Fund, L.P. Announce Proposed Bankruptcy...

Manchester, Inc. and Palm Beach Multi-Strategy Fund, L.P. Announce Proposed
Bankruptcy Plan Terms and Litigation Settlement

DALLAS, April 4, 2008 /PRNewswire/ -- Manchester, Inc. (the "Company") and
Palm Beach Multi-Strategy Fund, L.P. (the "Fund") jointly announced today that
the Company accepted a proposal (the "Proposal") made by Palm Beach
Multi-Strategy Fund, L.P. pursuant to which Manchester, Inc. and its
subsidiaries (collectively, "Manchester") would reorganize and emerge from
chapter 11 bankruptcy. Implementation of the Proposal is contingent on a
number of factors, including (1) deposit of $3 million to, in part, satisfy
the claims of unsecured creditors and, in part, to fund the expenses of
Manchester's bankruptcy estates in connection with the plan approval process,
(2) provision of DIP financing of up to $10 million, if necessary, to fund
Manchester while it is in bankruptcy, whether or not the plan is ultimately
approved, and (3) adoption and approval of a Plan of Reorganization (the
"POR"). The Proposal was part of an agreed-to interim cash collateral order
submitted to the United States Bankruptcy Court for the Northern District of
Texas, Dallas Division, on Wednesday, April 2, 2008. As part of the Proposal,
upon the deposit of the $3 million described above, Rick Stanley, former CEO,
and Tony Hamlin, former Chief Accounting Officer, will be reinstated as Chief
Operations Officer and Chief Accounting Officer, respectively, reporting to
the current board of directors of the Company.
As part of the proposed POR, the claims asserted by Manchester against the
Fund and its affiliates in cases pending in the United States Bankruptcy Court
and in the District Court, 101st Judicial District, Dallas County and the
claims asserted by the Fund against the current officers and directors of the
Company will be resolved upon approval of the POR. The Proposal also provides
that upon approval of the POR, Palm Beach's secured claim against Manchester
will be satisfied through the issuance to Palm Beach or its designee of all
shares of stock in the reorganized Company.
The full terms of the proposed POR will be incorporated into Manchester's
chapter 11 plan, which the parties expect to be filed on or before
April 16, 2008. Manchester and Palm Beach have agreed to seek an expedited
approval process for the plan, and anticipate that the plan will become
effective in early to mid June of this year. In the interim, Manchester will
continue to conduct business as usual and Manchester and Palm Beach will work
cooperatively to maximize the value of the business and minimize the effects
of the bankruptcy on Manchester's employees, customers, and vendors.
In furtherance of its fiduciary duties, Manchester remains obligated to
consider any better alternative to the Proposal that may arise.
This press release contains "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are based on currently available competitive, financial, and
economic data and management's views and assumptions regarding future events.
Such forward-looking statements are inherently uncertain. The Company cannot
provide assurances that any prospective matters described in the press release
will be successfully completed or that the Company will realize the
anticipated benefits of any transactions. Actual results may differ
materially from those projected as a result of certain risks and
uncertainties, including but not limited to: global economic and market
conditions; the war on terrorism and the potential from war or other
hostilities in other parts of the world; availability of financing and lines
of credit; successful integration of acquired or merged businesses; changes in
interest rates; management's ability to forecast revenues and control
expenses, especially on a quarterly basis; unexpected decline in revenues
without a corresponding and timely slowdown in expense growth; the Company's
ability to retain key management and employees; intense competition and the
Company's ability to meet demand at competitive prices and to continue to
introduce new products and new versions of existing products that keep pace
with technological developments, satisfy increasingly sophisticated customer
requirements and achieve market acceptance; relationships with significant
suppliers and customers; as well as other risks and uncertainties, including
but not limited to those detailed from time to time in the Manchester's SEC
filings. Manchester undertakes no obligation to update information contained
in this release. For further information regarding risks and uncertainties
associated with the business of Manchester, please refer to the risks and
uncertainties detailed in the Manchester's SEC filings.
SOURCE Manchester, Inc.; Palm Beach Multi-Strategy Fund, L.P.

Richard D. Gaines, President of Manchester, Inc., +1-570-857-1028