Contact: Sitrick And Company
Maya Pogoda
(310) 788-2850
Richard Wool
(212) 573-6100
FOR IMMEDIATE RELEASE
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STANDARD AUTOMOTIVE CORPORATION TO FACILITATE SALE OR RESTRUCTURING THROUGH
VOLUNTARY CHAPTER 11 REORGANIZATION
OBTAINS PROPOSAL FOR COMMITMENT FOR UP TO $5 MILLION IN POST-PETITION FINANCING
TO ASSURE BUSINESS AS USUAL
NEW YORK - MARCH 19, 2002 - STANDARD AUTOMOTIVE CORPORATION (the "Company")
(AMEX: AJX) today announced that to facilitate the sale or restructuring of some
or all of its subsidiaries, it, Ajax Manufacturing Company and certain of its
subsidiary holding companies - CPS Enterprises, Inc., Barclay Investments, Inc.
and Critical Components Corporation - have filed voluntary petitions for relief
under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court
for the Southern District of New York. Ajax Manufacturing Company was the only
operating company included in the filing. The Company noted that its primary
objective is to minimize the impact of the restructuring process on its
operating companies.
Concurrently, Standard Automotive said it received a proposal for a
commitment for up to $5 million in debtor-in-possession (DIP) financing from
Raymond International, W.L.L. to fund operations during the process. The
proposal and financing provided for therein would be subject to Court approval.
The Company is optimistic this facility will provide sufficient financial
resources to operate its business as usual during the Chapter 11 process.
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"This restructuring process allows time for prospective buyers to evaluate
the Company and its operations while day-to-day business activities continue
without interruption," said John E. Elliott, II, chairman and chief
restructuring officer, who joined the Company on February 11. "A sale of some
or all of the Company's subsidiaries is in the best interests of all
constituents because it will create greater access to the financial resources
necessary for such subsidiaries to prosper and grow, and have the least impact
on the jobs of their employees." Mr. Elliott noted over the past few months
the Company has held the line on costs while preliminary discussions have been
held with prospective buyers for all or parts of the Company. He added that the
Company intends to retain, subject to Court approval, Baltimore-based
investment-banking firm Legg Mason Wood Walker, Inc. to help facilitate the
sale.
Mr. Elliott emphasized that daily operations will continue as usual while
the restructuring is completed and expects that neither employees nor customers
of Standard Automotive should notice any difference in operations as a result of
the filing. "Our facilities will remain open and all aspects of the business
will go on as before the Chapter 11 filing," Mr. Elliott said. "Our employees
will continue to be paid as they always have and transactions that occur in the
ordinary course of business will proceed as usual."
Standard Automotive is a diversified company with production facilities
located throughout the United States, Canada and Mexico. Standard Automotive
manufactures precision products for aerospace, nuclear, industrial and defense
markets, and it builds a broad line of specialized dump truck bodies, dump
trailers, and related products.
The statements contained in this release that are not historical facts are
"forward-looking statements" (as such term is defined in the Private Securities
Litigation Reform Act of 1995).
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These statements include those describing the expected future operations of
Standard Automotive Corporation and the expectations regarding the outcome of
the financing and restructuring transactions described in this release.
Management wishes to caution the reader that these forward-looking statements
are only predictions and are subject to risks and uncertainties and actual
results may differ materially from those indicated in the forward-looking
statements as a result of a number of factors. These factors include, but are
not limited to, risks associated with the company's ability to complete the
transactions described in this release and those risks and uncertainties
described from time to time in the reports filed by the Company with the
Securities and Exchange Commission, including its Annual Report on Form 10-KA
filed on July 27, 2001 for the fiscal year ended March 31, 2001 and in its
Quarterly Report on Form 10-Q filed on February 19, 2002 for the quarter ended
December 31, 2001. Other important factors that could cause actual events or
results to be materially different from the forward-looking statements include
the ability of the Company to continue as a going concern; court approval of the
Company's first day papers and other motions prosecuted by it from time to time
in the chapter 11 cases; the ability of the Company to develop, prosecute,
confirm and consummate one or more plans of reorganization with respect to the
chapter 11 cases (or any significant delay with respect thereto); risks
associated with third parties seeking and obtaining court approval to terminate
or shorten the exclusivity period for the Company to propose and confirm one or
more plans of reorganization, for the appointment of a chapter 11 trustee or to
convert the cases into a chapter 7 cases.
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