Bush Industries, Inc. Reaches Agreement With Its Participating Senior Lenders to Restructure Debt
30 Marzo 2004 - 3:00PM
PR Newswire (US)
Bush Industries, Inc. Reaches Agreement With Its Participating
Senior Lenders to Restructure Debt Bush to File Pre-Negotiated
Chapter 11 Reorganization JAMESTOWN, N.Y., March 30
/PRNewswire-FirstCall/ -- Bush Industries, Inc. announced today
that ithas reached an agreement in principle and executed a lock-up
agreement with holders of more than 85% of the Company's
outstanding bank debt. Pursuant to the terms of the lock-up
agreement, the Company intends to file a petition for
reorganization underChapter 11 of the Bankruptcy Code on or about
March 31, 2004 in the United States Bankruptcy Court for the
Western District of New York. The Company intends to maintain its
current level of operations during the pendency of the bankruptcy
proceedings and the Company expects that its customers and vendors
will experience no change in the way the Company does business with
them. The Company's lenders that are a party to the lock-up
agreement will provide for debtor-in-possession financing, and an
exit financing facility thru 2006. The proposed plan of
reorganization will not impair trade creditor claims. Under the
proposed plan of reorganization, the Company's outstanding senior
debt of approximately $160 million will be restructured, with
approximately $70 million of debt being refinanced thru 2006, and
the balance of approximately $90 million being converted into 100%
of the equity of the reorganized Company. The Company believes that
the anticipated debtor-in- possession financing, together with cash
provided by operations, will provide sufficient liquidity for the
Company to continue its current level of operations during the
pendency of the Chapter 11 proceedings. The Company's decision to
file for bankruptcy was precipitated by the Company's inability to
procure alternative sources of financing, its inability to obtain
an extension from its lenders of the temporary waiver of non-
compliance with certain covenants under the Company's outstanding
credit facility, and its inability to reach an agreement with the
lenders to extend the term of the loan, which matures on June 30,
2004. The temporary waiver, previously announced on March 1, 2004,
will expire on April 1, 2004. Once its petition for reorganization
is filed, the Company expects to seek Court approval to, among
other things, continue payment of pre-petition and post-petition
wages and employee benefits. The Company will also seek
authorization from the Court to pay vendors for goods and services
provided to the Company before the Chapter 11 filing, as long as
those vendors continue to extend regular trade credit to the
Company. The Company expects that all vendors and suppliers will be
paid in full. The Company expects that the pendency of the Chapter
11 proceedings will be approximately 90 to 120 days. None of the
Company's subsidiaries are currently expected to be included in the
filing. Additionally, effective as of March 29, 2004, Paul Bush
resigned as Chairman, C.E.O. and director of the Company and its
subsidiaries. Mr. Bush has agreed to remain as an employee of the
Company, to be an advisor to management and the Board to help
ensure a smooth transition during the restructuring period. He will
further advise on and/or assist with retaining and strengthening
customer, vendor and other relationships, identifying and retaining
key personnel, designing new products and identifying strategic
opportunities. Mr. Michael Buenzow has been elected by the
Company's Board of Directors to serve as the Company's interim
C.E.O. during the pendency of the Chapter 11 proceeding. Mr.
Buenzow, 39, is currently a Senior Managing Director at FTI
Consulting (NYSE:FCN) and has been working with the Company during
the restructuring process. Prior to joining FTI in September 2002,
Mr. Buenzow was a partner in the Business Recovery Services
Practice of PricewaterhouseCoopers. Mr. Buenzow has had 15 years of
restructuring experience. The balance of the current management
team is anticipated to remain in place. The Company anticipates
that the Board of Directors of the reorganized Company will appoint
a permanent C.E.O. upon emergence from the Chapter 11 proceedings.
The Company has also appointed David G. Dawson as its interim
Chairman of the Board. "This restructuring, once fully implemented,
will allow Bush to take full advantage of the fundamental strength
of our core business operations. It will provide us a much-improved
balance sheet and capital structure that is more appropriate for
the current economic and market conditions. It is advantageous that
we were able to achieve a consensual plan of reorganization,"
stated Paul Bush. Mr. Bush continued, "Our customers and suppliers
should experience no change in the way we do business with them and
will continueto receive the same high quality goods and service to
which they are accustomed. The Company believes that it will be in
a better financial position to support further growth and take
advantage of additional opportunities in the marketplace." In
conclusion Mr. Bush emphasized, "We appreciate the ongoing loyalty
and support of our employees and thank them for their dedication
and hard work, which is critical to our success. We also thank our
customers and vendors for their support during this restructuring
process. We are committed to making this restructuring process
successful and leading Bush Industries towards a brighter future."
For more information contact Bush Industries, Inc. at
1-800-351-5182, or visit the Company's web site at
http://www.bushindustries.com/. Bush Industries, Inc. is a leading
global manufacturer of ready-to-assemble furniture, casegoods
furniture, and a supplier of surface technologies. The Company
operates its business in three segments: Bush Furniture North
America, which concentrates on furniture for the commercial office,
home office, home entertainment, bedroom and other home furnishings
distributed by leading retailers; Bush Furniture Europe, which
sells commercial, home office and other furnishings in the European
market; and Bush Technologies, which is focused on the cell phone
accessories after-market, as well as the utilization of surface
technologies in diverse applications such as automotive interiors,
cosmetics, sporting goods and consumer electronics. Bush operates
several manufacturing and warehouse facilities throughout North
America and Europe. Certain statements and information included in
this press release constitute "forward-looking statements" within
the meaning of the Federal Private Securities Litigation Reform Act
of 1995. Forward-looking statements involve known and unknown risks
and uncertainties, which may cause the Company's actual results in
future periods to differ materially from forecasted results.
Forward-looking statementsinclude statements regarding the intent,
belief, projected or current expectations of the Company or its
Officers (including statements preceded by, followed by or
including forward- looking terminology such as "may," "will,"
"should," "believe," "expect," "anticipate," "estimate," "continue"
or similar expressions or comparable terminology), with respect to
various matters. The Company cannot guarantee future results,
levels of activity, performance or achievements. Factors that could
cause or contribute to such differences include, but are not
limited to, economic, competitive, governmental and technological
factors affecting the Company's operations, markets, products,
services and prices, and other factors discussed in the Company's
filings with the Securities and Exchange Commission (the "SEC").
Copies of the Company's SEC filings are available from the SEC or
may be obtained upon request from the Company. The Company does not
undertake any obligation to update the information contained
herein, which speaks only as of this date. DATASOURCE: Bush
Industries, Inc. CONTACT: Bush Industries, Inc., 1-800-351-5182 Web
site: http://www.bushindustries.com/
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