Regency Affiliates Announces Completion of Recapitalization

Oct 17, 2002, 01:00 ET from Regency Affiliates, Inc.

    JENSEN BEACH, Fla., Oct. 17 /PRNewswire/ -- Regency Affiliates, Inc.
 ("Regency") announced today the completion of a recapitalization which
 included the redemption of the 754,950 shares of Regency common stock owned by
 Statesman Group, Inc., the former controlling stockholder of Regency, for an
 aggregate redemption payment of $1,020,000 (approximately $1.35 per share).
 The redemption was funded with the proceeds of loans totaling $4,750,000 from
 Royalty Holdings LLC, a private investor group ("Royalty") based in New York.
     In addition to providing Regency with needed working capital, proceeds
 from the Royalty loans were used by Regency to effect the redemption referred
 to above, acquire an option from Statesman to purchase the 20% interest in
 National Resource Development Corporation not presently owned by Regency, to
 modify the terms of the Regency Series C preferred stock held by Statesman,
 and to secure additional agreements from Statesman.  $3,500,000 of the Royalty
 loans (plus accrued interest) is convertible at the option of Royalty into
 shares of Regency common stock at a conversion rate of $2.00 per share.
     As part of the recapitalization, the existing board of directors and
 management team of Regency will resign without any severance or other
 termination payments.  Laurence S. Levy, a principal of Royalty, has been
 appointed President and Chief Executive Officer of Regency, and Neil N.
 Hasson, also a principal of Royalty, has been appointed Chief Financial
 Officer and Secretary of Regency.  The board of directors of Regency will
 consist of Mr. Levy, Mr. Hasson and two independent directors.  Regency's new
 management team members have extensive experience with operating companies and
 real estate investments.
     Mr. Levy, Regency's new President and Chief Executive Officer, said, "We
 are extremely impressed with the prospects for Regency and its assets.  We
 look forward to pursuing the monetization of Regency's current investments.
 We also expect to grow the asset base of Regency over the next few years with
 corporate acquisitions using our significant expertise in this area."
     Regency's present investments include an interest in Security Land and
 Development Company Limited Partnership.   Security Land owns a two story
 office building and connected six story tower totaling approximately 717,000
 square feet occupied by the Social Security Administration of the United
 States Government.
 1995.  Statements in this press release may constitute "forward-looking
 statements" within the meaning of Section 27A of the Securities Act of 1933,
 as amended, and Section 21E of the Securities Exchange Act of 1934, as
 amended.  Any statements contained herein which are not statements of
 historical facts and that address activities, events or developments that
 Regency or its management expects, believes or anticipates will or may occur
 in the future shall be deemed to be forward-looking statements.  Forward-
 looking statements are inherently subject to risks and uncertainties, many of
 which cannot be predicted with accuracy and some of which might not be
 anticipated.  Future events, actual results of performance, financial or
 otherwise, could differ materially from those set forth in or contemplated by
 the forward-looking statements herein.  Readers are cautioned not to place
 undue reliance on these forward-looking statements, which speak only as of the
 date hereof.  Regency undertakes no obligation to release publicly any
 revisions to these forward-looking statements that may be made to reflect
 circumstances after the date hereof or to reflect the occurrence of
 unanticipated events.  The inclusion of any statement in this press release
 does not constitute an admission by Regency or any other person that the
 events or circumstances described in such statement are material.
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SOURCE Regency Affiliates, Inc.