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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): SEPTEMBER 10, 1997
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FIELDCREST CANNON, INC.
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(Exact Name of Registrant as Specified in its Charter)
DELAWARE 1-5137 56-0586036
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(State of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
One Lake Circle Drive, Kannapolis, NC 28081
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (704) 939-2000
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NYFS01...:\07\45207\0003\139\FRM9127P.330
ITEM 5. OTHER EVENTS.
On September 10, 1997, Fieldcrest Cannon, Inc. (the "Company"),
Pillowtex Corporation ("Pillowtex") and a wholly-owned subsidiary of Pillowtex
("Newco") entered into an agreement (the "Merger Agreement") pursuant to which,
on the terms and subject to the conditions set forth therein, Newco will be
merged with and into the Company (the "Merger"), and the Company will thereby
become a wholly owned subsidiary of Pillowtex. A copy of the Merger Agreement is
filed as Exhibit 2.1 hereto and is incorporated herein by this reference.
On September 11, 1997, Pillowtex issued a press release announcing
the Merger. A copy of the press release is filed as Exhibit 99.1 hereto and is
incorporated herein by this reference.
At the effective time of the Merger (the "Effective Time"), (i) each
outstanding share of Common Stock, par value $1.00 per share, of the Company
("Fieldcrest Common Stock") will be converted into a right to receive total
consideration valued at $34.00, consisting of (a) $27.00 in cash and (b) a
number of shares of Common Stock, par value $0.01 per share, of Pillowtex
("Pillowtex Common Stock") equal to the quotient (the "Conversion Number")
obtained by dividing $7.00 by the average of the closing sales prices per share
of Pillowtex Common Stock on the New York Stock Exchange (the "NYSE") for each
of the 20 consecutive trading days immediately preceding the fifth trading day
prior to the date (the "Closing Date") on which the Merger is consummated (the
"Determination Price"), provided that the Conversion Number will not be more
than 0.333 or less than 0.269, and provided further that, if the Determination
Price is less than $21.00, the Company will have the right to elect to increase
the cash portion of such merger consideration and/or the Conversion Number such
that the sum of (1) the cash portion of such merger consideration and (2) the
product of (A) the Conversion Number and (B) the Determination Price equals
$34.00 and, if the Company does not so elect, Fieldcrest will have the right to
terminate the Merger Agreement, and (ii) each outstanding share of $3.00 Series
A Convertible Preferred Stock, par value $0.01 per share, of the Company, other
than shares converted into Fieldcrest Common Stock prior to the Merger, will be
converted into a right to receive total consideration valued at $58.12,
consisting of (a) a cash payment equal to the product of (1) the cash portion of
the merger consideration to be paid for each share of Fieldcrest Common Stock
and (2) 1.7094 and (b) a number of shares of
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Pillowtex Common Stock equal to the product of (1) the Conversion Number and(2)
1.7094.
The obligations of the Company and Pillowtex to consummate the
Merger are conditioned upon, among other things, (i) approval and adoption of
the Merger Agreement by the Company's stockholders; (ii) approval by Pillowtex's
shareholders of the issuance of shares of Pillowtex Common Stock and Pillowtex
preferred stock in connection with the Merger and related financing
transactions; (iii) the absence of any order or injunction that prohibits the
consummation of the Merger; (iv) the shares of Pillowtex Common Stock to be
issued in connection with the Merger having been authorized for listing on the
NYSE, subject to official notice of issuance; (v) a Registration Statement on
Form S-4 having been declared effective by the Securities and Exchange
Commission and not being subject to any stop order or proceeding seeking the
same; and (vi) the waiting period pursuant to the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, having expired or been terminated.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits
2.1 Agreement and Plan of Merger, dated September 10, 1997, by
and among Pillowtex Corporation, Pegasus Merger Sub, Inc.
and Fieldcrest Cannon, Inc.
99.1 Press release, dated September 11, 1997, issued by Pillowtex
Corporation
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SIGNATURE
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.
FIELDCREST CANNON, INC.
By: /s/Mark R. Townsend
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Mark R. Townsend
Dated: September 12, 1997
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INDEX TO EXHIBITS
EXHIBIT
NUMBER EXHIBIT
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2.1 Agreement and Plan of Merger, dated September
10, 1997, by and among Pillowtex Corporation,
Pegasus Merger Sub, Inc. and Fieldcrest
Cannon, Inc.
99.1 Press release, dated September 11, 1997,
issued by Pillowtex Corporation
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