UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): March 2, 2000
GENICOM CORPORATION
(Exact name of registrant as specified in its charter)
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Delaware 0-14685 51-0271821
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(State or other jurisdiction of (Commission (IRS Employer
incorporation) File Number) Identification No.)
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14800 Conference Center Drive, 20151
Suite 400, Westfields
Chantilly, Virginia
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(Address of principal executive offices) (Zip Code)
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REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (703) 802-9200
ITEM 3. BANKRUPTCY OR RECEIVERSHIP.
On March 10, 2000, Genicom Corporation (the "Company") filed in the United
States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"),
Case No. 00-1383, a voluntary petition for relief under Chapter 11 of the United
States Bankruptcy Code. On March 10, 2000, the Company also disseminated the
press release filed with this Current Report on Form 8-K as Exhibit 99.1.
ITEM 5. OTHER EVENTS.
Effective March 2, 2000 Paul Winn resigned as President and Chief Operating
Officer and as a member of the Board of Directors of the Company, and James
Gayle resigned as Chief Financial Officer. On March 13, 2000, Abraham Ostrovsky
resigned as a member of the Board of Directors of the Company. Effective March
20, 2000, Shaun Donnellan was appointed as President and Chief Executive Officer
of the Company, William Ligon as Senior Vice President and Chief Operating
Officer, A. Jeffrey Zappone as Senior Vice President and Chief Financial
Officer, and John Lefevere as Vice President - Legal. Effective March 6, 2000,
Harold L. McIlroy shall no longer serve as Chief Operating Officer of DSC, a
division of the Company.
On March 22, 2000, the Company filed a Motion with the Bankruptcy Court, in
which the Company asked the Bankruptcy Court to approve, inter alia, procedures
for the solicitation of
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bids for the sale of the Company's assets otherwise than in the ordinary course
of business. Prior to the filing of this Motion, the Company, after consultation
with its secured lenders, entered into a Term Sheet with Platinum Equity
Holdings ("Platinum") for the purchase of substantially all of its assets. A
copy of the Term Sheet is attached as Exhibit 99.2. The Term Sheet does not
prohibit the solicitation of other offers for the purchase of some or all of the
Company's assets. In the event the Company does not receive any higher bids for
its assets, the Company proposes, subject to the approval of the Bankruptcy
Court, to proceed with an asset sale transaction with Platinum.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
EXHIBITS. The following exhibits are furnished with this report:
EXHIBIT DESCRIPTION
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99.1 Press Release, dated March 10, 2000, issued by Genicom Corporation.
99.2 Term Sheet - Platinum Equity Holdings Purchase of Genicom Assets
FORWARD LOOKING STATEMENTS.
The statements contained in this release that are not historical facts are
forward-looking statements. These forward-looking statements reflect the
Company's views with respect to future events and financial performance. Such
statements are subject to risks and uncertainties that could cause the Company's
actual results and financial position to differ materially from those projected
in the forward-looking statements. Risks associated with the Company's
forward-looking statements include, but are not limited to, continued losses
that could affect the Company's abilitity to maintain itself as a going concern,
the effect of economic conditions, the impact of competition, as well as those
other risks detailed, from time to time, in the Company's Securities and
Exchange Commission filings. Readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of their dates. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
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 hereunto duly authorized.
GENICOM CORPORATION
/s/ SHAUN DONNELLAN
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DATE: MARCH 23, 2000 By: Shaun Donnellan
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President and Chief Executive Officer
EXHIBIT INDEX
EXHIBIT DESCRIPTION
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99.1 Press Release, dated March 10, 2000, issued by Genicom Corporation.
99.2 Tern Sheet - Platinum Equity Holdings Purchase of Genicom Assets
[GENICOM PRESS RELEASE]
For Further Information:
Theresa Pond
Vice President Corporate Communications
703-802-9217
FOR IMMEDIATE RELEASE
GENICOM Files For Chapter 11 Protection
Chantilly, VA.--March 10, 2000--GENICOM Corporation announced today that it has
filed for Chapter 11 bankruptcy protection in Delaware. As previously reported,
GENICOM Corporation has been operating in violation of its credit facility since
the third quarter of 1999. On February 25, 2000, GENICOM received formal notice
from its lender group of the occurrence of certain events of default under the
credit facility, including the Company's failure to make required principal and
interest payments. The notice also stated that all amounts due under the credit
facility had been accelerated and were fully due and payable. The lenders
immediately began exercising all of their rights and remedies, including their
right to offset the Company's bank accounts and foreclose on their collateral.
In prior press releases, GENICOM had identified uncertainties related to the
Company's ability to maintain itself as a going concern and noted that the
absence of lender support could make the initiation of bankruptcy proceedings
appropriate. On March 3rd, the Company was able to meet its payroll obligations
after its current lender group released sufficient funds from previously offset
money collected as the result of exercising its default remedies. Since then,
the Company has been unsuccessful in negotiating remedies to the default
occurrences and has thus filed for bankruptcy protection.
Subsequent to the filing, the Company and its lenders have agreed upon the terms
of a DIP loan facility of $6.9 million and a cash collateral order that will be
submitted to the court for approval. This agreement will enable the Company to
continue operations including the funding of payroll, materials, goods and
services on an ongoing basis. It is the Company's intention, in the near future,
to ask the court to approve a procedure that will allow interested parties to
submit proposals to purchase the Company's business in whole or in part. In
addition, the Company has determined not to proceed with an appeal of its
delisting from Nasdaq at this time.
In further developments, GENICOM announced the appointment of Shaun Donnellan to
act as President and Chief Executive Officer during the bankruptcy proceedings,
replacing Paul Winn. Concurrently, the Company's Senior Vice President of
Finance and CFO, James Gale, was replaced. The Company has also received Abraham
Ostrovsky's resignation, effective March 2nd, from his position as Director.
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The statements contained in this release which are not historical facts are
forward looking statements that involve risks and uncertainties, including, but
not limited to, the Company's ability to reach agreement with buyers on the
purchase of its business in whole or in part, secure new customers and maintain
its current customer base, the risk of customer delays or cancellations in both
on-going and new programs, supplier disruptions, the effect of economic
conditions, the impact of competition and other risks detailed, from time to
time, in the Company's Securities and Exchange Commission filings.
GENICOM Information
GENICOM Corporation is a global provider of integrated network solutions,
multivendor services and printer solutions focusing on the midrange,
client/server market. Its Document Solutions company (DSC) designs and markets a
wide range of high-performance serial matrix, line matrix, page and travel
industry printers, along with a complementary line of supplies, parts and
services.
GENICOM's Enterprising Service Solutions company (ESSC) provides comprehensive
IT solutions supporting emerging technologies such as Internet security,
e-commerce, xDSL, cable modem, voice data and their related equipment. ESSC also
delivers traditional support services including consulting, Help Desk,
internetworking services and multivendor on-site product repair.
GENICOM is heaquartered within metropolitan Washington, DC. For more information
on the company and its portfolio of enterprise printer and service solutions,
access the GENICOM web site at www.genicom.com or the ESSC web site at
www.essc.com.
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TERM SHEET
PLATINUM EQUITY HOLDINGS
PURCHASE OF GENICOM ASSETS
The following sets forth the general terms and conditions under which Platinum
Equity Holdings ("Platinum) agrees to purchase certain assets ("Assets") of
GENICOM Corporation ("GENICOM").
1. Sale Price: $42,000,000.00, plus the "Compaq Adjustment" as defined herein.
Payment is to be made in cash at Closing.
2. The Compaq Claim shall consist of all causes of action and other claims
which Genicom may have against Compaq as of the Closing. The "Compaq
Adjustment" means the greater of $3,000,000 and 40% of any recovery in
excess of $10 million received by Platinum in litigation or settlement of
the Compaq Claim.
3. Assets to be acquired: Accounts Receivable, Contract Rights, Real Estate
and Equipment Leases except as specifically excluded, Inventory, Furniture
Fixtures & Equipment, and Intangibles of GENICOM, and 100% of the stock of
GENICOM's subsidiaries. Not included in the Assets to be purchased is the
real property located in Waynesboro, Louisville and Boxborough, or any
sales proceeds from these excluded properties.
4. Platinum shall have until April 7, 2000 to complete its due diligence,
including on-site inspections.
5. Platinum shall have until April 7, 2000 at 4 p.m. EDT to advise the
President of GENICOM in writing that it wishes to withdraw its offer. In
such event, this offer to purchase shall be deemed null and void and
without liability to either party. If no notice of withdrawal is received
by 4 p.m. April 7, 2000, this offer to purchase shall be deemed irrevocable
until the earlier of (i) entry of an order approving another proposal for
the purchase of substantially all of the assets of GENICOM and (ii) June 7,
2000. At the time this offer becomes irrevocable, Platinum shall deposit
with an escrow agent the sum of $500,000, which shall be liquidated damages
for failure to close as provided herein should this Agreement to be
approved by the Bankruptcy Court. This deposit shall be applied to the
purchase price at Platinum's closing, or will be refunded if another bid is
successful.
6. Platinum shall be entitled to payment of a Breakup Fee of $500,000 in the
event GENICOM accepts, and the Bankruptcy Court approves a higher bid from
a purchaser or purchasers other than Platinum for substantially all of the
assets of GENICOM. GENICOM shall seek approval of this Breakup Fee from the
Bankruptcy Court at the hearing presently scheduled for March 30, 2000.
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7. Platinum agrees that if its proposal is accepted, it will execute a
definitive sales agreement similar in form and content to a proposed
agreement which will be available to all potential bidders no later than
March 31, 2000.
8. Platinum recognizes and agrees that GENICOM may solicit additional offers,
and that any sale of the Assets covered by this offer to purchase is
subject to approval of the Bankruptcy Court.
9. Other Conditions:
[] All necessary legal and regulatory approvals must be obtained prior to
Closing.
[] Transfer of the Assets is to be free and clear of all claims, liens and
encumbrances.
[] Sale is contingent upon approval by the United States Bankruptcy Court
for the District of Delaware ("Bankruptcy Court").
[] This offer is not subject to any financing contingencies.
[] The parties will work diligently to close this transaction no later than
10 days after approval of the sale by the Bankruptcy Court.
PLATINUM EQUITY HOLDINGS GENICOM CORPORATION
By: /s/ DOUG JOHNSON By: /s/ SHAUN DONNELLAN
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Doug Johnson Shaun Donnellan
Title: EVP Title: President & CEO
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Date: 3/20/00 Date: 3/21/00
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