<PAGE>
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
May 2, 1997
-------------------------------------------------------
Date of Report (Date of earliest event reported)
Empire of Carolina, Inc.
-------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-7909 13-2999480
- ---------------------------- ------------- ------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
5150 Linton Boulevard, 5th Floor, Delray Beach, Florida 33484
- --------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(561) 498-4000
------------------------------
(Registrant's telephone number)
1
<PAGE>
Item 5. Other Events.
On May 2, 1997, Empire Industries, Inc. entered into the Third Amendment
to Loan and Security Agreement (the "Amendment") with LaSalle National Bank,
BT Commercial Corporation, and Congress Financial Corporation (Central), The
CIT Group/Credit Finance, Inc., and Finova Capital Corporation attached
hereto as Exhibit 10.56, providing for, among other things, the amendment of
certain financial covenants, which Amendment, including the exhibits thereto,
is hereby incorporated by reference herein.
On June 11, 1997, Empire Industries, Inc. entered into the Fourth
Amendment to Loan and Security Agreement (the "Amendment") with LaSalle
National Bank, BT Commercial Corporation, and Congress Financial Corporation
(Central), The CIT Group/Credit Finance, Inc., and Finova Capital Corporation
attached hereto as Exhibit 10.57, providing for, among other things, the
amendment of certain financial covenants, which Amendment, including the
exhibits thereto, is hereby incorporated by reference herein.
On January 22, 1998, the holders of at least 75% of the Warrants voted
to amend the Warrant Agreement to include (i) 2,500,000 additional Warrants
pursuant to "Proposal 3" of the 1997 proxy statement of Empire of Carolina,
Inc. (the "Company") and (ii) to exchange the 200,000 GKM Warrants for
200,000 Warrants. Accordingly, the Company entered into the First Amendment
to the Warrant Agreement with the holders of the Warrants from time to time,
which Amendment, including the exhibits thereto, is hereby incorporated by
reference herein.
Item 7. Financial Statements and Exhibits.
Exhibit
Number Description
- -------- ------------------------------------------------------------
10.56 Third Amendment to Loan and Security Agreement (the
"Amendment") with LaSalle National Bank, BT Commercial
Corporation, and Congress Financial Corporation (Central),
The CIT Group/Credit Finance, Inc., and Finova Capital
Corporation
10.57 Fourth Amendment to Loan and Security Agreement (the
"Amendment") with LaSalle National Bank, BT
Commercial Corporation, and Congress Financial
Corporation (Central), The CIT Group/Credit Finance,
Inc., and Finova Capital Corporation
10.58 First Amendment to the Warrant Agreement with the
holders of the warrants from time to time
2
<PAGE>
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.
EMPIRE OF CAROLINA, INC.
By /s/ Lawrence Geller
----------------------------------
Name: Lawrence Geller
Title: Vice President
and General Counsel
Date: March 30, 1998
3
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- -------- ------------------------------------------------------------
10.56 Third Amendment to Loan and Security Agreement (the
"Amendment") with LaSalle National Bank, BT
Commercial Corporation, and Congress Financial
Corporation (Central), The CIT Group/Credit Finance,
Inc., and Finova Capital Corporation
10.57 Fourth Amendment to Loan and Security Agreement (the
"Amendment") with LaSalle National Bank, BT
Commercial Corporation, and Congress Financial
Corporation (Central), The CIT Group/Credit Finance,
Inc., and Finova Capital Corporation
10.58 First Amendment to Warrant Agreement with the holders of
the warrants from time to time
4
<PAGE>
EXHIBIT 10.56
April 30, 1997
Empire Industries, Inc.
501 Daniel Street
Tarboro, North Carolina
Reference is made to that certain Loan and Security Agreement (the
"Loan Agreement") dated as of May 29, 1996 among Empire Industries, Inc.
("Empire"), LaSalle National Bank, as collateral agent for itself
("LaSalle"), BT Commercial Corporation, as a lender ("BTCC") and each other
lender now or hereafter a party to the Loan Agreement (LaSalle, BTCC, and
each such other lender are sometimes collectively referred to as "Lenders"),
BTCC as administrative agent for all Lenders and all other Lenders.
Capitalized terms not otherwise defined herein shall have the meaning
ascribed to such terms in the Loan Agreement. Reference is further made to
(a) that certain First Amendment to Amended and Restated Loan and Security
Agreement dated December 6, 1996 among Empire, Agents and Lenders (the "First
Amendment") and (b) that certain Consent and Second Amendment to Loan and
Security Agreement dated February 4, 1997 among Empire, Agents and Lenders
(the "Second Amendment").
The parties hereto hereby agree as follows:
1. Pursuant to the First Amendment, a new subparagraph 13(n) was
added to the Loan Agreement, which required that Borrower receive an equity
contribution of at least $6,000,000 during the period from November 15, 1996
and April 30, 1997, on terms and subject to conditions satisfactory to Agents
and Lenders. The parties hereto hereby agree to extend the date by which
such equity contribution must be received by Borrower from April 30, 1997 to
May 31, 1997.
2. Pursuant to paragraph 2 of the Second Amendment, Agents and
Lenders agreed to negotiate with Borrower in good faith to set new covenant
levels for the covenants contained in Paragraphs 12(o) and 12(p) of the Loan
Agreement, to be effective beginning May 1, 1997 and further agreed that in
the event such negotiations did not result in an agreement, commencing May 1,
1997 the covenant levels currently contained in Paragraphs 12(o) and 12(p)
would be reinstated. The parties hereto hereby agree
<PAGE>
to extend the date by which either such new covenants shall become effective
or the current covenants shall be reinstated from May 1, 1997 to June 1, 1997.
Except as expressly provided hereby, the Loan Agreement, as amended
by the First Amendment and Second Amendment, shall remain unchanged and in
full force and effect in accordance with the terms thereof.
This letter shall not become effective until executed by all
parties hereto.
Very truly yours,
LASALLE NATIONAL BANK, as Collateral
Agent and Lender
By /s/ Robert Corsentino
----------------------------------------
Its Senior Vice President
Consented and agreed to this 2nd day of
May, 1997.
BT COMMERCIAL CORPORATION,
as Administrative Agent and a Lender
By /s/ Philip Isom
- ---------------------------------------
Its Associate
CONGRESS FINANCIAL CORPORATION
(CENTRAL), as a Lender
By /s/ Brett Mook
- ---------------------------------------
Its Vice President
THE CIT GROUP/CREDIT FINANCE, INC.,
as a Lender
By /s/ Terrance Shope
- ---------------------------------------
Its Vice President
FINOVA CAPITAL CORPORATION,
as a Lender
By /s/ Pete Martinez
- ---------------------------------------
Its Vice President
<PAGE>
Accepted and agreed to this 30th day of
April, 1997.
EMPIRE INDUSTRIES, INC.
By /s/ Lawrence Geller
- ---------------------------------------
Its Vice President and General Counsel
The undersigned Guarantor hereby acknowledges that it
has read the foregoing letter and all previous amendments and
modifications of the Loan Agreement and hereby reaffirms its
guaranty of the obligations of Borrower this 30th day of
April, 1997.
EMPIRE OF CAROLINA, INC.
By /s/ Lawrence Geller
---------------------------------------
Its Vice President and General Counsel
<PAGE>
EXHIBIT 10.57
June 11, 1997
Empire Industries, Inc.
501 Daniel Street
Tarboro, North Carolina
Re: Fourth Amendment to Loan and Security Agreement
Dear ____________________:
Reference is made to that certain Loan and Security Agreement (the
"Loan Agreement") dated as of May 29, 1996 among Empire Industries, Inc.
("Empire"), LaSalle National Bank, as collateral agent for itself
("LaSalle"), BT Commercial Corporation, as a lender ("BTCC") and each other
lender now or hereafter a party to the Loan Agreement (LaSalle, BTCC, and
each such other lender are sometimes collectively referred to as "Lenders"),
BTCC as administrative agent for all Lenders and all other Lenders.
Capitalized terms not otherwise defined herein shall have the meaning
ascribed to such terms in the Loan Agreement. Reference is further made to
(a) that certain First Amendment to Amended and Restated Loan and Security
Agreement dated December 6, 1996 among Empire, Agents and Lenders (the "First
Amendment"), (b) that certain Consent and Second Amendment to Loan and
Security Agreement dated February 4, 1997 among Empire, Agents and Lenders
(the "Second Amendment") and (c) that certain letter amendment dated April
30, 1997 among Empire, Agents and Lenders (the "Third Amendment").
The parties hereto hereby agree as follows:
1. Pursuant to the First Amendment, a new subparagraph 13(n) was
added to the Loan Agreement, which required that Borrower receive an equity
contribution of at least $6,000,000 during the period from November 15, 1996
and April 30, 1997, on terms and subject to conditions satisfactory to Agents
and Lenders. Pursuant to the Third Amendment, such period was extended to
May 31, 1997. The parties hereto hereby agree to extend the date by which
such equity contribution must be received by Borrower from May 31, 1997 to
June 30, 1997.
2. Pursuant to paragraph 2 of the Second Amendment, Agents and
Lenders agreed to negotiate with Borrower in good faith to set new covenant
levels for the covenants contained in Paragraphs 12(o) and 12(p) of the Loan
Agreement, to be effective beginning May 1, 1997 and further agreed that in
the event such negotiations did not result in an agreement, commencing May 1,
1997 the covenant levels currently contained in Paragraphs 12(o) and 12(p)
would be reinstated. Pursuant to the Third Amendment the parties agreed to
extend the date for setting new covenant levels to June 1. The parties
hereto hereby agree to extend the date by which either such new covenants
shall become effective or the
<PAGE>
Empire Industries, Inc.
June 11, 1997
Page 2
current covenants shall be reinstated from June 1, 1997 to July 1, 1997.
Except as expressly provided hereby, the Loan Agreement, as
amended, shall remain unchanged and in full force and effect in accordance
with the terms thereof.
This letter shall not become effective until executed by all
parties hereto.
Very truly yours,
LASALLE NATIONAL BANK,
as Collateral Agent and a Lender
By /s/ Robert Corsentino
--------------------------------
Its Senior Vice President
Consented and agreed to this 5th day of
June, 1997.
BT COMMERCIAL CORPORATION,
as Administrative Agent and a Lender
By /s/ Philip Isom
- ---------------------------------------
Its Associate
CONGRESS FINANCIAL CORPORATION
(CENTRAL), as a Lender
By /s/ Brett Mook
- ---------------------------------------
Its Vice President
THE CIT GROUP/CREDIT FINANCE, INC.,
as a Lender
By /s/ Terrance Shope
- ---------------------------------------
Its Vice President
FINOVA CAPITAL CORPORATION,
as a Lender
By /s/ Pete Martinez
- ---------------------------------------
Its Vice President
Accepted and agreed to this 11th day of
June, 1997.
EMPIRE INDUSTRIES, INC.
By /s/ Lawrence Geller
- ---------------------------------------
Its Vice President and General Counsel
<PAGE>
The undersigned Guarantor hereby acknowledges that it
has read the foregoing letter and all previous amendments and
modifications of the Loan Agreement and hereby reaffirms its
guaranty of the obligations of the Borrower this 11th day of
June, 1997.
EMPIRE OF CAROLINA, INC.
By /s/ Lawrence Geller
--------------------------------------------
Its Vice President and General Counsel
<PAGE>
EXHIBIT 10.58
FIRST AMENDMENT TO WARRANT AGREEMENT
THIS FIRST AMENDMENT to the Warrant Agreement, dated June 17 1997, by
and between Empire of Carolina, Inc., a Delaware corporation (the "Company"),
one the one hand, and the holders from time to time of the Warrants on the
other (each, a "Holder" and collectively, the "Holders") (the "Warrant
Agreement") is dated as of January 22, 1998 (the "First Amendment").
WHEREAS, the Company and the Holders believe that it is their mutual
best interests to amend the Warrant Agreement as set forth to increase the
aggregate shares issuable under the Warrant Agreement; and
WHEREAS, any provision of the Warrant Agreement may be amended, waived,
discharged or terminated only by and with the written consent of the Company
and the Holders of 75% of the Warrants.
WHEREAS, attached hereto as Exhibit A is a Certificate of the Secretary
of the Company with respect to the results of a vote amongst the Holders in
connection with this Amendment.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
1. The Warrant Agreement is amended to increase the aggregate shares
of Common Stock issuable under the Warrant Agreement from 7,500,000 to
10,200,000.
2. Except as expressly amended hereby, the Warrant Agreement remains in
full force and effect.
3. This Amendment shall be deemed to be a contract made under the laws
of the State of Delaware, and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts
made and performed entirely within such State.
4. This Amendment may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the same
instrument.
11
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the day and year first above written.
EMPIRE OF CAROLINA, INC.
By /s/ Lawrence Geller
----------------------------------------
Name: Lawrence Geller
Title: Vice President and
General Counsel
12
<PAGE>
EXHIBIT A
<TABLE>
<CAPTION>
WARRANT HOLDER WARRANTS VOTED VOTED
FOR AGAINST ABSTAINED
- ------------------------------------- ---------- ------- --------- ---------
<S> <C> <C> <C> <C>
OCTOBER OFFERING
- ----------------
Albert J. Miller & Helen K.
Miller Family Trust 10,000 X
Andrew A. Stern 10,000 X
Bernard Kirsner Trust 5,000 X
Bruce Corbin 1,000 X
Charles E. Bradley 20,000 X
Charles Leithauser 5,000 X
Claudia C. Rouhana 2,500 X
David Morley 2,500 X
David S. Lawi 2,500 X
Paul W. Perkins 5,000 X
Dr. Paul D. Goldenheim 2,500 X
Dr. Richard Corbin 1,500 X
Estelle K. Meislich 5,000 X
Garo A. Partoyan 3,750 X
Gerald B. Jones 10,000 X
H. Eugene Graves 20,000 X
Hare & Co. As Custodian For
Royal Bank Of Canada 40,000 X
Harvey M. Campbell 5,000 X
J. David Shapiro 1,000 X
J.A. Cardwell 5,000 X
J.A. Cardwell, Jr. 2,500 X
J.F. Shea Co., Inc As Nominee 1997-25 100,000 X
John Piccolo 5,000 X
John T. Stanner 5,000 X
13
<PAGE>
WARRANT HOLDER WARRANTS VOTED VOTED
FOR AGAINST ABSTAINED
- ------------------------------------- ---------- ------- --------- ---------
<S> <C> <C> <C> <C>
Jonathan Cohen 1,000 X
Kevin L. Jackson 1,250 X
Lenore H. Schupak 7,500 X
Neal Holtvogt 2,000 X
Patrick H. Miller, Jr. 20,000 X
Pro Series Racing, Inc. 5,000 X
Richard Palmer 2,500 X
Robert A. Simms 20,000 X
Theodore Stern 10,000 X
Walter Ingstrup 1,250 X
Wilfred Huse 5,000 X
William H. Lennon 5,000 X
William J. Rouhana, Jr. 2,500 X
William Joe Jackson 5,000 X
William Schoen 2,500 X
Andre W. Iseli 2,500 X
Churchill Ass. L.P. 13,000 X
Conzett Europa - Invest 50,000 X
CSP Trust 12,500 X
Fiducie Desjardins A/C 744766-7-59 20,000 X
Fiducie Desjardins A/C 900595-0-59 5,000 X
George L. Smith 2,500 X
Goldstein Family Living Trust 2,500 X
Howard Bernstein 2,500 X
Phillip T. George, M.D. 12,500 X
Stephen T. Skoly, Jr. 2,500 X
Thomas E. McLain PC
Employee Retirement Trust 7,500 X
14
<PAGE>
WARRANT HOLDER WARRANTS VOTED VOTED
FOR AGAINST ABSTAINED
- ------------------------------------- ---------- ------- --------- ---------
<S> <C> <C> <C> <C>
Walter F. Toombs 5,500 X
Ferdinand F. Anderson, Jr. 1,250 X
Commonwealth Associates, Inc. 9,100 X
Michael A. Falk 336,476 X
Keith M. Rosenbloom 87,973 X
Edward R. Downe, Jr. 50,000 X
Eric Rand 48,571 X
Robert O'Sullivan 43,986 X
Cornelia F. Eldridge 30,000 X
Robert R. Beuret 26,857 X
Vincent Labarbara 20,250 X
Basil Asouitto 14,286 X
Joseph P. Wynne 14,286 X
Michael R. Lyall 14,286 X
C. James Walker, Jr. 9,500 X
Michael Volpe 6,661 X
Stephen Labarbara 6,661 X
Anthony J. Giardina 5,357 X
David Stein 3,750 X
Ronald Moschetta 3,571 X
Eric Rubenstein 3,571 X
Travis Brock 3,500 X
Robert Nass 1,786 X
Mark Danieli 1,786 X
Craig Leppla 1,786 X
Richard Galterio 1,500 X
Mario Marsillo, Jr. 1,500 X
David Wynne 1,500 X
Michael Scalfani 1,500 X
15
<PAGE>
WARRANT HOLDER WARRANTS VOTED VOTED
FOR AGAINST ABSTAINED
- ------------------------------------- ---------- ------- --------- ---------
<S> <C> <C> <C> <C>
Charles S. Holmes 625,000 X
James J. Pinto 625,000 X
JUNE OFFERING
- --------------
EMP Associates, LLC 1,266,988 X
Pellinore Securities Corp. 112,754 X
Axiom Capital Management, Inc. 112,754 X
Aquae Sulis Investment Fund Limited 15,000 X
Atlantic & Overseas Holdings Ltd. 25,000 X
Contrary Fund-Parker Quillen/Pres 10,000 X
Melanie R. Dacus 9,500 X
Louis De Ricco 3,500 X
The Humayan Waheed MD PC Pension 2,500 X
Little Wing LP 10,000 X
Medusa Capial S.A. 20,000 X
Charles S. Meyer 10,000 X
Gregory J. Osborne 4,500 X
Swiss Bank Corporation 30,000 X
Swiss Bank Corporation 7,500 X
Swiss Bank Corporation 10,000 X
Swiss Bank Corporation 10,000 X
Swiss Bank Corporation 20,000 X
Swiss Bank Corporation 2,500 X
Tradewinds Fund Ltd. 10,000 X
Kenneth Allen 5,000 X
Nicky Borcea, IRA Rollover 10,000 X
16
<PAGE>
WARRANT HOLDER WARRANTS VOTED VOTED
FOR AGAINST ABSTAINED
- ------------------------------------- ---------- ------- --------- ---------
<S> <C> <C> <C> <C>
Tai-San Cheng 10,000 X
Fontaine R. Christensen and 10,000 X
Kevin Flanders 2,500 X
Anthony Cirillo 12,500 X
Luke Scanlon 5,000 X
M. Perry Grant 5,000 X
John Illibassi Family Trust 10,000 X
Jastmar Associates 5,000 X
Kenneth R. Kafesak 10,000 X
Gary F. Lexa 5,000 X
Wayne McLaughlin and 20,000 X
John C. McNay and 5,000 X
George Mordiglia IRA R/O Decd. 15,000 X
RHL Associates, L.P. 15,000 X
John P. O'Shea 10,000 X
Jay T. Robling 10,000 X
Lance C. Senning 5,000 X
Michael Spadaro 10,000 X
Leslie C. Taylor Trust Agreement 5,000 X
Arthur Steinberg, IRA Rollover 5,000 X
Lloyd W. Taylor and 5,000 X
Harvey K. Yee 5,000 X
Timothy Moran 50,000 X
Freeburn Ventures ltd. 50,000 X
Mark S. Rose 50,000 X
William Forman 50,000 X
Richard L. Bazelon 10,000 X
Richard G. David 5,000 X
17
<PAGE>
WARRANT HOLDER WARRANTS VOTED VOTED
FOR AGAINST ABSTAINED
- ------------------------------------- ---------- ------- --------- ---------
<S> <C> <C> <C> <C>
Ronald A. Koplow 5,500 X
Venogopal K. Menon 2,500 X
Julio Novogrodzki 5,000 X
Leonard M. Schiller 5,000 X
Schneider Fuel & Oil, Inc. Pension Plan 5,000 X
Town & Country Oil Corp.
Pension Plan & Trust 2,500 X
Theodore Stern SEP IRA 10,000 X
Jo-Bar Enterprises, L.L.C. 10,000 X
Joyce N. Westmoreland 2,500 X
Kenneth R. Falchuk 2,500 X
Zachary Gomes 10,000 X
Daniel R. Lee 20,000 X
Patrick H. Miller Jr. 10,000 X
Frederick J. Oswald 2,500 X
J.F. Shea Co., Inc. as Nominee 1997-25 100,000 X
J. Michael Wolfe 10,000 X
Pro Series Racing, Inc. 5,000 X
Bill Hickey 10,000 X
Aegis Pension Plan 20,000 X
James R. Baugh and 10,000 X
W. Sam Chandoha 10,000 X
John J. Doran 10,000 X
Harvey Feldschreiber and 10,000 X
Philip T. George 12,500 X
Phillip D. Gunn & Co., Inc. 10,000 X
J. Peter Kline 20,000 X
James H. Lynch, Jr. 10,000 X
18
<PAGE>
WARRANT HOLDER WARRANTS VOTED VOTED
FOR AGAINST ABSTAINED
- ------------------------------------- ---------- ------- --------- ---------
<S> <C> <C> <C> <C>
Alexander B. Miller 5,000 X
Ronald Miller 10,000 X
Stephen V. Millea and 10,000 X
Sanford Kirschenbaum and 16,000 X
MKS' OMO Contracting, Inc. 2,000 X
Sanford Kirchenbaum & CO., CPA, PA 2,000 X
Lenore H. Schupak 15,000 X
Sintra Fund, Ltd. 25,000 X
Donna de Varona 2,500 X
SJG Management, Inc. 12,500 X
Yair Talmi 10,000 X
Paul and Benradette Torre 5,000 X
Worldwide Fabrics, L.P. 10,000 X
Faisal Finance (Switzerland) S.A. 30,000 X
William Joe Jackson 5,000 X
John Shaw 10,000 X
Joshua Gottlieb 2,500 X
Kenneth R. Falchuk 2,500 X
David H. Zises 5,000 X
Suzanne Schiller 5,000 X
Edward T. Schnedier 2,500 X
Wilfred Huse 5,000 X
James J. Pinto 1,978,252 X
Charles S. Holmes 2,078,752 X
Telcom Partners, L.P. 62,500 X
Commonwealth Associates, Inc. 750,000 X
</TABLE>
19
<PAGE>
Total for Both Offerings:
- -------------------------
For: 8,521,373
Against: 27,857
Abstain: 1,450,770
85% Voted for the Amendment, .2% Voted Against the Amendment; 14.5% Abstained
Total for June Offerings:
- --------------------------
For: 6,716,992
Against: 17,500
Abstain: 765,508
89.6% Voted for the Amendment, .2% Voted Against the Amendment; 10.2% Abstained
Attachment
cc: American Stock Exchange
20
