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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT FOR EVENT OCCURRING JULY 30, 1999
OF
GOSS GRAPHIC SYSTEMS, INC.
a Delaware Corporation
IRS Employer Identification No. 25-1200273
SEC File Number 333-08421
700 OAKMONT LANE
WESTMONT, ILLINOIS 60559-5546
(630) 850-5600
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ITEM 3. BANKRUPTCY OR RECEIVERSHIP.
On July 30, 1999, Goss Graphics Systems, Inc. (the "Company") and
certain of its U.S. based subsidiaries filed voluntary petitions for
reorganization under Chapter 11 of the U.S. Bankruptcy Code in the United States
Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). The
petitions do not cover the Company's foreign based subsidiaries.
In connection with the Chapter 11 filing, the Company has obtained a
commitment for $50 million in debtor-in-possession financing and issued a press
release announcing the Company's filing (the "Press Release").
A copy of the Press Release is filed as Exhibit 1 hereto.
The foregoing summary does not purport to be complete and is qualified
in its entirety by reference to the Press Release which is incorporated by
reference and the Chapter 11 petition and motions and related pleadings and
papers on file with the Bankruptcy Court.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits.
99.1 Text of press release dated July 30, 1999.
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SIGNATURE
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 thereunto duly authorized.
Dated: August 10, 1999
GOSS GRAPHIC SYSTEMS, INC.
By: /s/ Joseph Gaynor
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EXHIBIT 99.1
INVESTOR CONTACT: Joseph Gaynor, III MEDIA CONTACT: Barbara Gora
Goss Graphic Goss Graphic
[GRAPHIC Systems, Inc. Systems, Inc.
OMITTED] (630) 850-4200 (630) 850-6043
Ellen Gonda
Gavin Anderson
& Company
(212) 373-0231
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FOR IMMEDIATE RELEASE NEWS RELEASE
GOSS GRAPHIC SYSTEMS ANNOUNCES NEW FINANCING, CREDITOR AGREEMENTS
AND RESTRUCTURING PLAN
WESTMONT, ILL, July 30, 1999 - Goss Graphic Systems, Inc. announced today that
it has reached an agreement on a restructuring of the Company with noteholders
holding more than two-thirds of the Company's'12% Senior Subordinated Notes due
2006, lenders under the Company's $200 million revolving credit facility and its
principal stockholder, Stonington Partners.
Under the agreement, the noteholders will exchange the $225 million principal
amount of notes currently outstanding for a new $112.5 million note issue and
certain new stock of the Company. The Company's lenders and Stonington will
jointly provide an additional $100 million of liquidity and capital.
The parties have agreed to implement the agreement through a prearranged Chapter
11 proceeding, initiated today in the U.S. Bankruptcy Court for the District of
Delaware. The Company's European and Asian subsidiaries are not included in the
Chapter 11
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proceeding. To ensure that the Company has adequate working capital to
operate its business normally during the restructuring proceedings, it has
secured a commitment for up to $50 million in new interim financing to be
provided jointly by certain of its bank lenders and its principal shareholder
Stonington Partners.
"We are very pleased to have attracted such a high level of support
from our noteholders on a restructuring plan that will permit Goss to obtain new
financing and reduce our indebtedness," said Goss Chairman, President and Chief
Executive Officer Jim Sheehan. "Such support indicates a high likelihood of
success for timely and efficient implementation of our restructuring plan. Our
agreement also permits uninterrupted service to our valued customers, while
enabling us to continue to implement our operating turnaround. We are confident
that with the support of employees, suppliers, creditors and customers a
successful reorganization will be achieved."
"We believe this restructuring of our capital base will place us on a
solid financial path today and in the future," Sheehan continued. He added that
he expects the Company to emerge from Chapter 11 proceedings within the next
several months.
In the interim, the Company plans to continue to pay employee wages,
salaries and benefits as usual. The Company will pay for the post-petition
delivery of goods and services in the ordinary course of business. Under the
restructuring plan, the claims of all creditors, including trade creditors,
will either not be impaired by the plan or will be paid in full over time.
This financial restructuring is the culmination of Goss' efforts to
identify and address challenges facing the Company. The Company has
implemented an operational turnaround of the Americas business unit under a
new organizational structure and a new management team,
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implemented cost reductions initiatives, refined its product portfolio and
installed a new enterprise software system. Other elements of this turnaround
plan will be expedited in conjunction with the Company's financial
restructuring.
Goss Graphic Systems, Inc. is a global leader in the manufacturing of
advanced technology web offset equipment for the newspaper and commercial
printing industries. In business since 1885, the Company supplies a broad range
of printing press equipment. It is the only leading press supplier with
manufacturing facilities in each of the world's major press markets --- the
Americas, Europe and Asia.
Certain of the statements contained in this press release are
forward-looking. While the Company believes that these statements are accurate,
the Company's business is dependent upon general economic conditions and various
conditions specific to its industry, and future trends and results cannot be
predicted with certainty.
