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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
AUGUST 16, 1999
(Date of Report)
Date of earliest event reported: August 13, 1999
MERKERT AMERICAN CORPORATION
(Exact name of Registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
0-24667 04-3411833
(Commission File Number) (I.R.S. Employer Identification No.)
490 TURNPIKE STREET
CANTON, MA 02021
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(781) 828-4800
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ITEM 5. OTHER EVENTS.
On August 13, 1999, Merkert American issued a press release announcing that it
has entered into an agreement with First Union National Bank to amend its senior
credit facility following the planned merger with Richmont Marketing Specialists
Inc., which is attached as Exhibit 99.1 and incorporated by reference herein.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Financial Statements of Business Acquired: Not Applicable
(b) Pro Forma Financial Information: Not Applicable
(c) Exhibits:
99.1 Press Release
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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.
Date: August 13, 1999 MERKERT AMERICAN CORPORATION
By: /s/ Gerald R. Leonard
-----------------------------------
Gerald R. Leonard
President
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EXHIBIT INDEX
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Exhibit
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99.1 Press Release
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EXHIBIT 99.1
Merkert American Corporation
490 Turnpike Street
Canton, MA 02021
(Nasdaq/NMS: MERK)
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<CAPTION>
AT THE COMPANY AT THE FINANCIAL RELATIONS BOARD
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<S> <C>
Gerald Leonard, President Analyst Info: Lynn Sawyer-Landau
and Chief Executive Officer General Info: Joseph Calabrese/Paula Schwartz
Joseph Casey, Chief Financial Officer Media Info: Judith Sylk Siegel
(718) 828-4800 (212) 561-8030
</TABLE>
MERKERT AMERICAN AGREES IN PRINCIPLE TO TERMS
---------------------------------------------
OF AMENDED CREDIT FACILITY
--------------------------
Merkert American Corporation (Nasdaq/NMS:MERK), a leading provider of
outsourced sales and marketing services to manufacturers, suppliers and
producers of food products and consumer goods -- and the only publicly-traded
food broker in the United States -- reported today that it has entered into an
agreement with First Union National Bank to amend its senior credit facility
following the planned merger with Richmont Marketing Specialists Inc.
("Richmont").
First Union has agreed to waive Merkert American's defaults as of June 30,
1999 under its financial covenants and to consent to the merger with Richmont,
subject to the parties finalizing and executing the definitive documentation for
the amended credit facility. Merkert American expects to close the merger with
Richmont shortly following the shareholders meeting on August 18, 1999, subject
to shareholder approval.
The amended credit facility will continue to provide for a $50 million term
loan and a $25 million revolving line of credit and will otherwise be
substantially similar to Merkert American's existing credit facility with
certain amended terms. The amended credit facility requires the payment of a
consent fee equal to 1% of the aggregate amount of the credit facility
($750,000) payable upon either (i) syndication or refinancing the facility and
(ii) a default under the facility. The amendment also requires the payment of a
syndication fee of $250,000 on March 31, 2000 if the credit facility has not
been syndicated by that time, with additional fees of $350,000 at June 30, 2000
and $150,000 at the end of each month thereafter until the credit facility has
been syndicated. Other amendments include determining compliance with the
EBITDA covenant on a monthly instead of quarterly basis, revising the EBITDA
threshold for September 30, 1999 and December 31, 1999 to reflect recent
financial results, revising the interest coverage covenant to conform to the
corresponding covenant in Richmont's 10 1/8% senior subordinated notes and
basing the interest rate on the Prime Rate option instead of the LIBOR option.
The Borrowing Base will be expanded to include an agreed upon portion of
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Richmont's accounts receivables. The amended credit facility also contemplates
that Merkert American will eliminate the minimum annual fee of $1 million
payable to Monroe & Company, LLC and Richmont Capital Partners, I, L.P. under
the new advisory agreement and defer payment of Richmont closing fees otherwise
payable to the same advisors until the amended credit facility has been
syndicated.
***
Merkert American, based in Canton, Massachusetts, provides outsourced sales,
marketing and merchandising services to manufacturers of food and other consumer
products. Merkert American is one of the five largest food brokers in the
United States and the only food broker with comprehensive coverage of the
eastern United States. Merkert American represents more than 750 manufacturers
and 70,000 food and non-food stock-keeping units, and does business with key
retailers in 25 states.
***
This press release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended and Section 21E of the
Securities Exchange Act of 1934, as amended. Reliance should not be placed on
forward-looking statements because they involved unknown risks, uncertainties
and other factors, which are, in some cases, beyond the control of Merkert
American. Actual events, performance and results could differ materially from
the anticipated events, performance or results expressed or implied by such
forward-looking statements. The factors which may cause such differences
include, among other things, Merkert American's ability to consummate any of the
transactions contemplated by the letters of intent to which Merkert American is
a party; Merkert American's ability to successfully integrate any future and
past acquisitions, the stockholder vote or other conditions relating to the
Richmont merger; principal realignment as a result of the proposed merger, the
competitive environment; and general economic conditions. For further
information, please refer to the Company's filing with the Securities and
Exchange Commission.
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