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: OCTOBER 9, 1997
(Date of earliest event reported)
APPLIANCE RECYCLING CENTERS OF AMERICA, INC.
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(Exact name of registrant as specified in its charter)
MINNESOTA 0-19621 41-1454591
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(State or other jurisdiction of Commission (I.R.S. Employer
incorporation or organization) File No. Identification No.)
7400 EXCELSIOR BOULEVARD
MINNEAPOLIS, MINNESOTA 55426
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(Address of principal executive offices) (Zip Code)
(612) 930-9000
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(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events.
On October 9, 1997, Appliance Recycling Centers of America, Inc. (the
"Company") issued a press release reporting the filing for protection under
Chapter 11 of the federal bankruptcy act by its subsidiary, Appliance Recycling
Centers of America - California, Inc.; an expected net loss for third quarter
1997; and the entering into an agreement with Whirlpool Corporation to develop a
program to handle damaged appliances for Whirlpool.
Item 7 (c). Exhibits.
20 Press Release dated October 9, 1997
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.
Dated: October 20, 1997 APPLIANCE RECYCLING CENTERS
OF AMERICA, INC.
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Registrant
By: /s/ Kent S. McCoy
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Kent S. McCoy
Vice President & Treasurer
Exhibit 20
Press Release
APPLIANCE RECYCLING CENTERS OF AMERICA, INC.
7400 EXCELSIOR BOULEVARD, MINNEAPOLIS, MN 55426 (612) 930-9000
FOR IMMEDIATE RELEASE FOR MORE INFORMATION CONTACT: KENT McCOY
(612) 930-9000
CALIFORNIA SUBSIDIARY OF ARCA FILES REORGANIZATION TO ENSURE UNINTERRUPTED
OPERATIONS
ARCA ANNOUNCES AGREEMENT WITH WHIRLPOOL CORPORATION
FOR RESELLING/RECYCLING DAMAGED WHIRLPOOL APPLIANCES
THIRD QUARTER RESULTS TO BE BELOW EXPECTATIONS
October 9, 1997---Minneapolis, MN---To ensure uninterrupted operations
while resolving an ongoing dispute with the minority shareholder of its
California subsidiary, Appliance Recycling Centers of America-California, Inc.
(ARCA California) and its parent company, Appliance Recycling Centers of
America, Inc. (ARCA, Nasdaq Small-Cap Market: ARCI), today announced that ARCA
California has filed a voluntary petition for relief seeking a reorganization of
the subsidiary under Chapter 11 of the federal bankruptcy act.
Edward R. (Jack) Cameron, President and Chief Executive Officer, said,
"This action is a pro-active measure to ensure that business at ARCA
California's appliance recycling center in Los Angeles will continue
uninterrupted while the dispute with ARCA California's minority shareholder is
settled in an equitable and timely manner." ARCA California supports the energy
conservation program of Southern California Edison Company.
In a related matter, the Company said it has reached an interim
arrangement with its secured lender which allows the Company to borrow an amount
comparable to its previous line of credit. ARCA and its lender entered into this
interim arrangement in response to legal proceedings brought by ARCA
California's minority shareholder, which caused the Company's secured note to be
called.
The Company also announced it has entered into an agreement with
Whirlpool Corporation, the nation's largest manufacturer of major household
appliances, to develop a program for handling damaged appliances for Whirlpool.
Under the agreement, the Company will purchase damaged appliances from
Whirlpool, recondition suitable units, and sell them through ARCA's network of
Encore retail stores. Cameron said this agreement is expected to provide Encore
with a significant new supply of high-quality appliances that can be sold at
attractive prices. Appliances that cannot be reconditioned will be recycled in
accordance with all federal, state and local environmental regulations.
<PAGE>
Due partly to below-plan operating results at two of the Company's
recycling centers and lower than expected recycling revenues, the Company said
it will report a net loss for the third quarter of 1997. Near break-even
operating results previously had been anticipated. The Company's third quarter
performance was also affected by weak Encore sales during the month of July.
Encore sales rebounded over the following two months of the quarter, with the
Company posting record weekly sales toward the end of September.
ARCA, the nation's largest recycler of major household appliances,
provides an integrated range of collection, reuse and recycling services.
Statements about ARCA's outlook are forward-looking and involve risks
and uncertainties, including but not limited to, approval of the Chapter 11
reorganization plan for ARCA California, development of the Whirlpool recycling
program, and other factors discussed in the Company's filings with the
Securities and Exchange Commission.
