(EAGLEPICHER LOGO) News Release
EAGLEPICHER HOLDINGS,INC. AND EAGLEPICHER INCORPORATED
CONTACT: SANDRA STERNBERG
ANITA-MARIE LAURIE
602-794-9620 OR
310-788-2850
EAGLEPICHER FILES CHAPTER 11
COMPANY WILL CONTINUE TO OPERATE WHILE IT SEEKS BUYERS FOR CERTAIN OF ITS
OPERATING UNITS
RECEIVES $50 MILLION DIP FINANCING COMMITMENT
PHOENIX, ARIZ. - APRIL 11 -- EaglePicher Holdings, Inc., and
EaglePicher Incorporated (collectively "EaglePicher") announced today that, in
order to implement their strategic initiatives and position the company for the
future, they and several of their affiliates have voluntarily filed to
reorganize under Chapter 11 of the Bankruptcy Code. EaglePicher said the filing
would facilitate its previously planned divestiture of a number of its operating
units and enable it to more effectively restructure its business.
In papers filed with the U.S. Bankruptcy Court in the Southern District
of Ohio in Cincinnati, the company said it has received a commitment for up to
$50 million in debtor-in-possession (DIP) financing from a group of lenders led
by Harris Trust and Savings Bank, subject to court approval and certain
limitations and conditions. Under the terms of the proposed DIP agreement,
EaglePicher's existing receivables securitization
would be replaced and the DIP would provide the company with substantial
additional liquidity.
According to EaglePicher President and CEO Bert Iedema, a number of
factors combined to severely limit both the company's liquidity and borrowing
ability. "While we would have preferred to restructure out of court, recent
events have deprived us both of the time and resources to do so," Mr. Iedema
said, adding that continuing deterioration at its Hillsdale automotive unit and
high commodity costs in metal and energy have left the company with insufficient
cash to continue to operate without additional borrowing.
"Over the past several weeks it has become clear to management that in
order to maximize value for creditors, EaglePicher must preserve the value of
its various operating divisions and, at the same time, focus the company's
resources where they will provide the greatest return," Mr. Iedema said. "The
company looked at several alternatives, including various recapitalization and
refinancing options. However, mounting liquidity problems have left us with
little choice but to file Chapter 11 as a means to continue to operate while we
seek the best and highest offers for the businesses we decide to sell."
Mr. Iedema said that the company expects day-to-day operations to
continue as usual during the Chapter 11 process. "We appreciate the past support
of our suppliers and expect that, with the availability of the DIP financing and
the protections afforded under the Bankruptcy Code, they will have the assurance
they need to continue to work with us going forward."
He added that management has sought authority from the Bankruptcy Court
to pay employees and retirees and continue benefits without interruption or
delay.
2
"We deeply appreciate the loyalty of our employees, retirees and
customers. We intend to fulfill our commitments to them without interruption
while we reorganize under court protection. Moreover, we remain committed to
providing our customers with high quality products, supported by superior
customer and technical service. Meeting their needs remains our highest
priority."
The company's operations outside the United States were not included in
the filing, and there should be no impact whatsoever on their ability to serve
customers, pay employees and fulfill their financial obligations to suppliers.
Additional information may be obtained by visiting the company's
website at www.eaglepicher.com.
EAGLEPICHER INCORPORATED, founded in 1843, and headquartered in
Phoenix, Arizona, is a diversified manufacturer and marketer of innovative,
advanced technology and industrial products and services for space, defense,
environmental, automotive, medical, filtration, pharmaceutical, nuclear power,
semi-conductor and commercial applications worldwide. The company has 4,200
employees and operates more than 30 plants in the U.S., Canada, Mexico, Korea,
and Germany.
EAGLEPICHER HOLDINGS, INC. is the parent of EaglePicher Incorporated.
EaglePicher(TM) is a trademark of EaglePicher Incorporated.
# # #
FORWARD-LOOKING STATEMENTS. This news release contains statements that, to the
extent that they are not recitations of historical fact, constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, section 21E of the Securities Exchange Act of
1934. Such forward-looking information involves risks and uncertainties that
could cause actual results to differ materially from those expressed in any such
forward-looking statements. These risks and uncertainties include, but are not
limited to: our ability to maintain existing relationships with customers,
demand for our products, our ability to successfully implement productivity
improvements and/or cost reduction initiatives, including the performance of
automated equipment, accuracy of our estimates to complete contracts on a
percentage of completion method of accounting, our ability to source raw
materials and components from overseas suppliers, accuracy of our reserves for
losses, our ability to consolidate manufacturing plants, our ability to develop,
market and sell new products, our ability to obtain raw materials especially
certain grades of steel and natural gas on an economic basis, increased
government regulation or changing regulatory policies resulting in higher costs
and/or restricting output, increased price competition, currency fluctuations,
general economic conditions, acquisitions and divestitures, technological
developments and changes in the competitive environment in which we operate, as
well as factors discussed in our filings with the U.S. Securities and Exchange
Commission. We undertake no duty to update the forward-looking statements in
this press release and you should not view the statements made as accurate
beyond the date of this press release.
3