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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) February 28, 2003
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PHILIPP BROTHERS CHEMICALS, INC.
(Exact name of registrant as specified in its charter)
New York 333-64641 13-1840497
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification Number)
incorporation)
One Parker Plaza
Fort Lee, New Jersey 07024
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(Address of Principal Executive Offices) (Zip Code)
(201) 944-6020
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(Registrant's telephone number, including area code)
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Item 5. Other Events and Regulation FD Disclosure.
On February 28, 2003, the Company's Norwegian subsidiary, Odda Smelteverk
AS filed for bankruptcy under the Norwegian Bankruptcy Act of June 8, 1984 (the
"Norwegian Act"). The Company anticipates that its other Norwegian subsidiary,
Odda Holdings AS (the parent of Odda Smelteverk AS), will file for bankruptcy
under the Norwegian Act within the next two weeks. The two Norwegian
subsidiaries are herein referred to collectively as "Odda".
The Company is a guarantor under two separate multi-currency credit
facilities entered into by Odda with Norwegian banks in August 1998.
Indebtedness under both facilities is collateralized by a lien on Odda's
receivables, inventory and property and production facilities. The credit
facilities were restructured in October 2002, as a result of the partial
shutdown of Odda's operations and non-compliance with the financial covenants of
the credit facilities. Under the agreement to restructure the credit facilities
and to obtain a waiver for non-compliance, Odda agreed to a periodic payment
schedule through November 30, 2003. Based upon communications between the
Company and Odda's Norwegian banks regarding the credit facilities, the Company
believes that it will continue to be able to discharge Odda's indebtedness under
such credit facilities in accordance with the previously agreed periodic payment
schedule. As of February 28, 2003, an aggregate of NOK 40,881,000 (US$5,710,000)
was outstanding under the credit facilities.
The Indenture, dated as of June 11, 1998, as supplemented, among the
Company, the Guarantors named therein and The Chase Manhattan Bank, as trustee,
relating to the Company's 9-7/8% Senior Subordinated Notes due 2008 (the
"Notes"), contains certain provisions with respect to the Significant
Subsidiaries (as defined) and/or Restricted Subsidiaries (as defined) of the
Company, including Events of Default due to various events involving (and
including the bankruptcy of) Significant Subsidiaries or Restricted
Subsidiaries. The Company has obtained the requisite consent of a majority of
the holders of the Notes to amend the Indenture to exclude each of Odda
Smelteverk AS and Odda Holdings AS as a Significant Subsidiary and as a
Restricted Subsidiary from various provisions defining Events of Default under
the Company's Indenture, including any Event of Default which would otherwise
result from bankruptcy filings by Odda.
As previously reported, the Company has written off substantially all of
its Norwegian assets. The Company does not believe that Odda's bankruptcy filing
will have a material adverse effect on its financial condition or results of
operations.
* * *
This Form 8-K contains "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, and are based upon beliefs of, and
information currently available to the Company's management. The Company's
actual results could differ materially from those set forth in the
forward-looking statements. Factors that could cause actual developments to
differ materially from those contemplated, include, without limitation: (i) the
decisions and actions of creditors of the Company and its subsidiaries; (ii) the
Company's ability to negotiate with its creditors and creditors of its
subsidiaries; (iii) additional facts and developments, not now known to the
Company; and (iv) the risks of future litigation by creditors of Odda. Certain
additional factors that might cause such a difference are discussed in the
Company's Annual Report on Form 10-K for its fiscal year
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ended June 30, 2002 and/or in its most recent Form 10-Q for its quarterly period
ended December 31, 2002. The Company assumes no responsibility to update the
information included in this Form 8-K.
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SIGNATURES
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.
PHILIPP BROTHERS CHEMICALS, INC.
By: /s/ JACK C. BENDHEIM
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Jack C. Bendheim, Chairman of the Board
By: /s/ GERALD K. CARLSON
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Gerald K. Carlson, Chief Executive Officer
By: /s/ RICHARD G. JOHNSON
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Richard G. Johnson, Chief Financial Officer
Dated: February 28, 2003
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