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UNITED STATES
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)
September 17, 2001 (September 17, 2001)
THE FONDA GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 13-3220732
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2920 North Main Street, Oshkosh, Wisconsin 54901
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: 920/235-9330
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Item 9 - Regulation FD Disclosure
Sweetheart Cup Company Inc. ("Sweetheart") is conducting a private
placement of notes pursuant to Rule 144A. The offering will be limited to
qualified institutional buyers and accredited investors. Pursuant to the
offering, Sweetheart will be issuing $275.0 million principal amount of Senior
Notes due 2007 (the "Notes"), the proceeds of which, together with funds from a
proposed new $190.0 million revolving credit facility from Bank of America, N.A.
(the "New Senior Credit Facility"), will be used (i) to redeem the Sweetheart
10-1/2% Senior Subordinated Notes (the "Sweetheart Notes"), (ii) to fund the
purchase of the 9-1/2% Senior Subordinated Notes (the "Fonda Notes") of The
Fonda Group, Inc. ("Fonda"), and (iii) to repay Fonda's revolving credit and
term loan facility and Sweetheart's domestic revolving credit and term loan
facility (the "Bank Financing"). Sweetheart will redeem the Sweetheart Notes
directly with the proceeds of the offering. The Fonda Notes will be purchased
through a tender offer (the "Tender Offer"). Concurrently with the Tender Offer,
Sweetheart will solicit consents from the holders of the Fonda Notes to certain
amendments to the indenture governing such notes (the "Consent Solicitation").
Concurrently with the offering, Fonda will be merged with and into
Sweetheart, with Sweetheart as the surviving entity. In connection with the
merger, all of the assets and operations of Fonda will be assigned to, and all
of the liabilities of Fonda will be assumed by, Sweetheart by operation of law.
In addition, as part of Sweetheart's ongoing cost reduction and profit
improvement initiatives, Sweetheart has begun a program to rationalize,
consolidate and improve its manufacturing and administrative facilities. Upon
completion of the consolidation program, Sweetheart expects to realize annual
cost savings by December 2002 of approximately $13.8 million. It estimates the
out-of-pocket cost of implementing the consolidation program to be approximately
$13.0 million. Sweetheart believes the consolidation program will improve the
efficiency of its manufacturing sites without any adverse impact on customer
service levels. In connection with the consolidation program, Sweetheart
anticipates realizing a minimum of $10.0 million from the sale of certain
surplus real estate, the proceeds of which will be used to fund capital
expenditures. In addition, in July 2001 Sweetheart completed an overhead
reduction program from which it will realize annual cost savings of
approximately $1.6 million over the next 12 months. It expects to realize
additional annual cost savings of approximately $0.9 million over the next 12
months by further reducing headcount and eliminating certain administrative and
duplicative professional services.
No assurance can be made that the offering of notes, the Bank Financing,
the Tender Offer, the Consent Solicitation, the merger with Fonda or the
consolidation and cost savings by Sweetheart will be completed.
The Notes have not been registered under the Securities Act of 1933 and may
not be offered or sold in the United States absent registration or any
applicable exemption from registration requirements. This current report on Form
8-K does not constitute an offer to sell or the solicitation of an offer to buy
any security.
Any statements in this report that are not historical facts are
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended. The
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words "estimate," "anticipate" and other expressions that indicate future events
and trends identify forward-looking statements. These forward-looking statements
are subject to risks and uncertainties that could cause actual results to differ
materially from historical results or those Sweetheart anticipates. Factors that
could have a material and adverse impact on actual results are described in
Sweetheart's annual report on Form 10-K for the year ended September 24, 2001
and quarterly report on Form 10-Q for the thirty nine weeks ended June 24, 2001.
All forward-looking statements in this report are qualified by reference to the
cautionary statements included in Sweetheart's Form 10-K and Form 10-Q.
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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.
THE FONDA GROUP, INC.
(registrant)
Date: September 17, 2001 By: /s/ Hans H. Heinsen
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Hans H. Heinsen
Senior Vice President -
Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer
and Duly Authorized Officer)