| Item 2.05 | Costs Associated with Exit or Disposal Activities. |
On February 8, 2021, Verso Corporation (“Verso”) committed to permanently shut down its No. 14 paper machine and certain other long-lived assets at its paper mill in Wisconsin Rapids, Wisconsin, while continuing to explore viable and sustainable alternatives with the remaining assets, including its converting operations, No. 16 paper machine and other remaining long-lived assets. This decision was made in response to the continued accelerated decline in printing and writing paper demand. The decision to permanently shut down its No. 14 paper machine and certain other long-lived assets, which have been idle since July 2020, will permanently reduce Verso’s total annual production capacity by approximately 185,000 tons of coated paper. Verso furloughed approximately 700 employees when the Wisconsin Rapids Mill was idled in July 2020.
In connection with the decision to permanently shut down the No. 14 paper machine and certain other long-lived assets, Verso does not expect to further reduce the number of employees remaining at the mill from what was already recognized after the July 2020 idling. Verso is in the process of analyzing alternatives with the remaining assets, and thus does not have sufficient information at this time to estimate the associated pre-tax non-cash charges related to its No. 14 paper machine and other long-lived assets, or any cash or non-cash charges associated with contract termination and other associated charges.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
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Exhibit
Number | | Description of Exhibit |
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| 104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
Forward-Looking Statements
In this Current Report on Form 8-K, all statements that are not purely historical facts are 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. Forward-looking statements may be identified by the words “believe,” “expect,” “anticipate,” “project,” “plan,” “estimate,” “intend,” “potential” and other similar expressions. Forward-looking statements are based on currently available business, economic, financial, and other information and reflect management’s current beliefs, expectations, and views with respect to future developments and their potential effects on Verso and include statements regarding the expectations regarding the reduction in paper production and the number of employees as a result of the permanent shut down of the No.14 paper machine at the Wisconsin Rapids Mill. Actual results could vary materially depending on risks and uncertainties that may affect Verso and its business. Verso’s actual actions and results may differ materially from what is expressed or implied by these statements due to a variety of factors, including those risks and uncertainties listed from time to time in Verso’s filings with the Securities and Exchange Commission (“SEC”), including those in Verso’s Annual Report on Form 10-K for the year ended December 31, 2019 under the heading entitled “Risk Factors,” as such risk factors may be amended, supplemented or superseded from time to time by other reports Verso files with the SEC. Verso assumes no obligation to update any forward-looking statement made in this report to reflect subsequent events or circumstances or actual outcomes.
