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) January 14, 1998
HOME HOLDINGS INC.
(Exact name of registrant as specified in its charter)
Delaware 0-19347 13-3584978
(State of Incorporation) (Commission file number) (I.R.S. Employer
Identification No.)
59 Maiden Lane, New York, New York 10038-4548
(Address or principal executive office) (Zip Code)
Registrant's telephone number including area code (212) 530-6600
Item 5. Other Events
The Registrant announced today that, pursuant
to a resolution of its Board of Directors, it had filed
today a voluntary petition for bankruptcy relief and a
pre-arranged plan of reorganization (the "Plan") under
Chapter 11 of the United States Bankruptcy Code in the
United States Bankruptcy Court for the Southern District
of New York (Case No. 98 B 40319 (JHG)). The filing of
the Plan culminates several months of negotiations among
representatives of the Registrant's principal shareholders--
Home Holdings Inc. Stock Trust, a trust for the shareholders
of Trygg-Hansa AB ("Trygg-Hansa") (through its subsidiary
Trygg-Hansa Holding B.V.) and Zurich Home Investments
Limited--and an unofficial committee of holders of the
Registrant's 7-7/8% Senior Notes due December 15, 2003,
7-7/8% Senior Sinking Fund Notes due December 15, 2003 and
7% Senior Notes due December 15, 1998 (the "Notes").
Under the Plan, the senior creditors of Home
Holdings (including the holders of the Notes) would
exchange their existing notes, in the aggregate principal
amount of $280 million, for new notes having an estimated
principal value of approximately $70 million and Earn Out
Notes. Zurich Centre Group would agree to commence a
tender offer to purchase the new notes at a price equal
to 99% of principal plus accrued interest within 60 days
after the Plan becomes effective. Payments on the Earn
Out Notes would be based on savings related to the
Registrant's net operating loss tax carryforwards. In
addition to the senior creditors, Trygg-Hansa would
receive Earn Out Notes in exchange for certain junior
notes issued by the Registrant to Trygg-Hansa, and The
Home Insurance Company, a New Hampshire domiciled
property and casualty insurance company and the principal
wholly-owned subsidiary of Home Holdings ("Home
Insurance"), would receive Earn Out Notes in exchange for
a release of its claims against under a tax sharing
agreement, dated February 13, 1991, by and between the
Registrant and Home Insurance.
Also under the Plan, upon its emergence from
Chapter 11, the Registrant would transfer all of the
outstanding stock of Home Insurance to a New Hampshire
limited liability company, which would be managed by a
New Hampshire corporation jointly owned by Zurich Home
Investments Limited and, subject to regulatory approval,
Trygg-Hansa. All of the beneficial interest in the
limited liability company would be transferred to the
senior creditors of Home Holdings, and Risk Enterprise
Management Limited would continue to manage the run-off
operations of Home Insurance.
The New Hampshire Insurance Commissioner, who
made Home Insurance subject to an order of formal
supervision in March, 1997, has consented to those
aspects of the reorganization that are within the scope
of his authority and pre-requisite to the reorganization.
In connection with the filing of the Plan, the
Board of Directors of the Registrant voted on January 14,
1998 to suspend its pending request that Home Insurance
pay a dividend to the Registrant for the payment of
$11,637,500.00 in interest that came due on December 15,
1997 on the Notes. Under the terms of the Notes, the
Registrant has a 30-day grace period from December 15,
1997 before an Event of Default under the Indentures
relating to the Notes occurs.
Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits
(c) Exhibits.
(99.1) Press release issued on January 15,
1998.
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.
HOME HOLDINGS INC.
Dated: January 15, 1998 By: /s/ Richard H. Hershman
__________________________
Richard H. Hershman
(Principal Financial and
Accounting Officer through the
Services Agreement, dated June
12, 1995, between Risk
Enterprise Management Limited, a
Delaware corporation, and Home
Insurance)
Exhibit 99.1
FROM: EDWARD G. NOVOTNY & ASSOCIATES, INC.
Two Tudor City Place
New York, New York 10017
Tel.: (212) 490-2065
FOR: HOME HOLDINGS INC. FOR IMMEDIATE RELEASE
59 Maiden Lane Thursday, January 15, 1998
New York, New York 10038
HOME HOLDINGS INC. FILES
CHAPTER 11 PLAN OF REORGANIZATION
NEW YORK - Home Holdings Inc., pursuant to a
resolution of its Board of Directors, filed today a
voluntary petition for bankruptcy relief and a pre-
arranged plan of reorganization under Chapter 11 of the
United States Bankruptcy Code in the United States
Bankruptcy Court for the Southern District of New York
(Case No. 98 B 40319 (JHG)). The filing of the Plan success-
fully culminates several months of negotiations among
representatives of Home Holdings' principal shareholders--
which are Home Holdings Inc. Stock Trust, a trust for the
shareholders of Trygg-Hansa AB (through its subsidiary
Trygg-Hansa Holding B.V.) and Zurich Home Investments
Limited--and an unofficial committee of holders of publicly-
held notes of Home Holdings.
Under the Plan, the senior creditors of Home
Holdings (including the holders of Home Holdings' public
debt) would exchange their existing Home Holdings notes,
in the aggregate principal amount of $280 million, for
new notes having an estimated principal value of
approximately $70 million and Earn Out Notes. Zurich
Centre Group would agree to commence a tender offer to
purchase the new notes at a price equal to 99% of
principal plus accrued interest within 60 days after the
Chapter 11 plan becomes effective. Payments on the Earn
Out Notes would be based on savings related to Home
Holdings' net operating loss tax carryforwards. In
addition to the senior creditors, Trygg-Hansa would
receive Earn Out Notes in exchange for certain junior
notes issued by Home Holdings to Trygg-Hansa, and The
Home Insurance Company, a New Hampshire domiciled
property and casualty insurance company and the principal
wholly-owned subsidiary of Home Holdings, would receive
Earn Out Notes in exchange for a release of its claims
against Home Holdings under a 1991 tax sharing agreement.
Also under the Plan, upon its emergence from
Chapter 11, Home Holdings would transfer all of the
outstanding stock of Home Insurance to a New Hampshire
limited liability company, which would be managed by a
New Hampshire corporation jointly owned by Zurich Home
Investments Limited and, subject to regulatory approval,
Trygg-Hansa. All of the beneficial interest in the
limited liability company would be transferred to the
senior creditors of Home Holdings, and Risk Enterprise
Management Limited would continue to manage the run-off
operations of Home Insurance.
The New Hampshire Insurance Commissioner, who
made Home Insurance subject to an order of formal
supervision in March, 1997, has consented to those
aspects of the reorganization that are within the scope
of his authority and pre-requisite to the reorganization.
In connection with the filing of the Plan, the
Board of Directors of Home Holdings voted on January 14,
1998 to suspend its pending request that Home Insurance
pay a dividend to Home Holdings for the payment of
$11,637,500.00 in interest that came due on December 15
on Home Holdings' 7-7/8% Senior Notes due December 15,
2003, 7-7/8% Senior Sinking Fund Notes due December 15,
2003 and 7% Senior Notes due December 15, 1998. Under
the terms of these Notes, Home Holdings has a 30-day
grace period from December 15, 1997 before an Event of
Default under the Indentures relating to the Notes
occurs.
