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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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):
AUGUST 31, 2000 (AUGUST 31, 2000)
DYERSBURG CORPORATION
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(Exact name of registrant as specified in charter)
TENNESSEE 1-11126 62-1363247
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(STATE OR OTHER JURISDICTION (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER
OF INCORPORATION) IDENTIFICATION NO.)
15720 JOHN J. DELANEY DRIVE, SUITE 445, CHARLOTTE, NORTH CAROLINA 28277-2747
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (704) 341-2299
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Item 5. Other Events
Dyersburg Corporation announced today that it has reached an agreement
on a proposed restructuring of the Company with an informal committee of
bondholders holding approximately 50 percent of the Company's Senior
Subordinated Notes due September 1, 2007 and lenders under the Company's
revolving credit facility.
The parties have agreed to implement the proposed restructuring through
a pre-negotiated proceeding under Chapter 11 of the Bankruptcy Code. To ensure
that the Company has adequate working capital to operate its business normally
during the anticipated restructuring proceedings, the Company's current bank
lenders have agreed to extend the existing $74 million revolving credit facility
as well as roll over a term loan of $23 million. Additionally, the bank lenders
have agreed to decrease the reserve against borrowing availability under the
revolving line of credit from $7 million to $2.5 million, thereby increasing the
Company's borrowing availability by $4.5 million. Under the proposed
restructuring plan, general unsecured creditors, including all trade creditors,
will be unimpaired.
Under the agreement, holders of Dyersburg's 9.75 percent Senior
Subordinated Notes due September 1, 2007 will receive new common stock
representing 100 percent of all shares issued and outstanding at the conclusion
of the restructuring process and a $15 million Senior Subordinated
Payment-in-Kind Note with a term of 7 years. Additionally, the agreement
contemplates that all existing common stock in Dyersburg Corporation will be
cancelled and the holders of existing common stock will receive two series of
warrants to acquire up to 15 percent of the new common stock. By implementing
this financial restructuring, Dyersburg expects to reduce its total borrowings
on a pro forma basis as of July 1, 2000 from $201 million to $91 million.
Additionally, the Company said that the restructuring would reduce cash payments
for interest on such debt by $12.1 million per year.
Safe Harbor Statement Under The Private Securities Litigation Reform
Act of 1995.
This report contains certain forward-looking statements within the
meaning of the federal securities laws, all of which are intended to be covered
by the safe harbors created thereby. These statements include all statements
regarding the Company's intent, belief and expectations (such as statements
concerning the Company's liquidity and future operating and financial strategies
and results) and any other statements with respect to matters other than
historical fact. Investors are cautioned that all forward-looking statements
involve known and unknown risks and uncertainties (some of which are beyond the
control of the Company) including, without limitation, the ability of the
Company to implement the proposed restructuring, the ability of the Company to
operate successfully under Chapter 11, the ability of the Company to propose and
have approved a plan of reorganization in the anticipated bankruptcy proceeding,
the ability of the Company to obtain Bankruptcy Court approvals, the ability of
the Company to continue to access availability under the Credit Agreement, risks
associated with the Company's use of substantial financial leverage, access to
trade credit and terms from suppliers, the ability of the Company to improve its
operating performance, restrictions imposed by the terms of the Company's credit
facility, the Company's ability and
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success in achieving cost savings, the Company's ability to compete with other
suppliers and to maintain acceptable gross margins, potential adverse
developments with respect to the cost and availability of raw materials and
labor, risks associated with governmental regulation and trade policies, and
potential adverse developments regarding product demand or mix. Moreover,
although the Company believes that any assumptions underlying the
forward-looking statements contained herein are reasonable, any of the
assumptions could prove to be inaccurate. Therefore, in light of these known and
unknown risks and uncertainties, there can be no assurances that the
forward-looking statements included in this press release will prove to be
accurate and the inclusion of such information should not be regarded as a
representation by the Company or any other person that the forward-looking
statements included in this report will prove to be accurate. The Company
undertakes no obligation to update any forward-looking statements contained in
this report.
Item 7(c). Exhibits
99 Press Release dated August 31, 2000
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.
DYERSBURG CORPORATION
Date: August 31, 2000
/s/ William S. Shropshire, Jr.
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William S. Shropshire, Jr.
Executive Vice President, Chief Financial
Officer, Secretary and Treasurer
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EXHIBIT INDEX
No Exhibits
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99 Press Release dated August 31, 2000.
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