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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
Date of Report (Date of earliest event reported): July 11, 1997
FLAGSTAR CORPORATION
(Exact name of registrant as specified in charter)
Delaware 1-9364 13-3027522
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
203 East Main Street, Spartanburg, South Carolina 29319-9966
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (864) 597-8000
________________________________________________________________________________
(Former Name or Former Address, if Changed Since Last Report)
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Item 3. Bankruptcy or Receivership
On July 11, 1997, Flagstar Companies, Inc., a Delaware corporation
("FCI"), and its wholly-owned subsidiary Flagstar Corporation, a Delaware
Corporation (the "Company"), filed their joint prepackaged plan of
reorganization (the "Plan") pursuant to Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the District of
South Carolina. FCI and the Company will be debtors in possession in the
proceeding which is captioned In re Flagstar Companies, Inc., Flagstar
Corporation, and Flagstar Holdings, Inc., Debtors (Case No. 97-05431-B
Jointly Administered) and will continue to operate their businesses,
subject to the supervision and orders of the Bankruptcy Court.
Previously, on July 8, 1997, FCI and the Company had announced that
they had concluded the solicitation of votes with respect to the Plan
and that the Plan had received approval from all classes entitled to vote on
the Plan except for holders of Flagstar's 10% Convertible Junior Subordinated
Debentures due 2014.
Copies of the press releases dated July 8, 1997 and July 11, 1997 are
attached to this current Report on Form 8-K as Exhibit 99.1 and Exhibit 99.2,
respectively.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
<TABLE>
<CAPTION>
Exhibit Number Description
<S> <C>
2.1 The Company's Plan of Reorganization (filed as part of Amendment No.
3 to FCI's Registration Statement on Form S-4 (No. 333-23875) on June
3, 1997 and incorporated herein by reference).
99.1 Press Release dated July 8, 1997.
99.2 Press Release dated July 11, 1997.
</TABLE>
2
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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.
FLAGSTAR CORPORATION
Date: July 24, 1997 By: /s/ Rhonda J. Parish
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Name: Rhonda J. Parish
Title: Senior Vice President,
General Counsel and
Secretary
3
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Investor Contact: Larry Gosnell
Flagstar
(864) 597-8658
Media Contact: Karen Randall
Flagstar
(864) 597-8440
FOR IMMEDIATE RELEASE
FLAGSTAR RESTRUCTURING PLAN RECEIVES
OVERWHELMING SUPPORT
SPARTANBURG, S.C., July 8, 1997 -- Flagstar Companies, Inc. (OTC:FLST)
today announced that its financial restructuring plan has been overwhelmingly
approved by creditors and shareholders in the consent solicitation which
concluded yesterday, paving the way for a voluntary, "prepackaged" Chapter 11
filing in U.S. Bankruptcy Court in South Carolina within the next few days.
The company said that every class approved the plan by a wide margin
except for holders of its 10% Convertible Junior Subordinated Debentures due
2014, which was expected. The Chapter 11 filing therefore is "prepackaged,"
which should result in an expedited bankruptcy process and a quick emergence
from Chapter 11. Although one class, holding the smallest amount of Flagstar's
debt, has not voted in favor of the plan, the bankruptcy court may still approve
the plan if it is deemed fair and equitable to all stakeholders, in which case
the class may
-more-
-2-
forfeit its right to any recovery under the plan.
"We are pleased by the support we have received from our senior note
holders, our senior subordinated debenture holders and our preferred and common
stockholders in the face of a much needed financial overhaul," said James B.
Adamson, chairman and chief executive officer of Flagstar. "The vote is a clear
indication that our plan treats all classes fairly. With the voting now behind
us, we are in an excellent position to complete our restructuring on our
original schedule by the fall of this year."
Flagstar is one of the nation's largest restaurants companies, with over
3,200 moderately-priced restaurants and annual revenues of approximately $2.7
billion. Flagstar owns and operates the Carrows, Coco's, Denny's, El Pollo Loco
and Quincy's Family Steakhouse restaurant brands and is the largest franchisee
of Hardee's.
<PAGE>
Investor Contact: Larry Gosnell
Flagstar
(864) 597-8658
Media Contact: Karen Randall
Flagstar
(864) 597-8440
FOR IMMEDIATE RELEASE
FLAGSTAR FILES VOLUNTARY CHAPTER 11 PLAN,
ENTERING FINAL STAGE OF RESTRUCTURING PROCESS
SPARTANBURG, S.C., JULY 11, 1997 -- Flagstar Companies, Inc. (OTC:FLST) today
announced that it has commenced the final stage of the approval process for its
financial restructuring by filing its plan with the U.S. Bankruptcy Court in
South Carolina. The company's "pre-packaged" plan has already been
overwhelmingly approved by creditors in a consent solicitation which concluded
earlier this week. The plan must now be approved by the U.S. Bankruptcy Court
as part of a Chapter 11 proceeding before it can be implemented.
The Chapter 11 proceeding only involves Flagstar Companies, Inc., the parent
company, and its corporate subsidiaries, Flagstar Corporation and Flagstar
Holdings, Inc. The subsidiaries that operate the company's restaurants are not
affected in any way and will continue to operate in the normal course outside of
the context of the bankruptcy proceeding. Flagstar expects parent company
operations to continue as usual.
The company noted that it enters its Chapter 11 proceeding with an agreement
for a $200 million debtor-in-possession revolving credit facility from The Chase
Manhattan Bank. Flagstar also has a written commitment from Chase for a $200
million senior secured revolving credit facility that will refinance the
debtor-in-possession facility upon the company's emergence from Chapter 11, to
be used for working capital advances and letters of credit.
"This step moves us closer to the final approval and completion of a
restructuring process that will enable us to shed approximately $1.1 billion in
debt and preferred stock and establish a capital structure for our company that
will help us resume a course of growth and profitability," said James B.
Adamson, chairman and chief executive officer of Flagstar. "We enter this
process with the enthusiastic support of all but our smallest class of
debtholders, sufficient liquidity from our operations and the bank financing we
have arranged. Most importantly, our many fine restaurant brands will be the
foundation of our success when we emerge from Chapter 11. We also have an
employee base that is one of the finest in the industry, which will enable us to
achieve our strategic goals once the restructuring process is completed."
Flagstar is one of the nation's largest restaurant companies, with over 3,200
moderately-priced restaurants and annual revenue of approximately $2.7 billion.
Flagstar owns and operates the Carrows,
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Coco's, Denny's, El Pollo Loco and Quincy's Family Steakhouse restaurant brands
and is the largest franchisee of Hardees.
