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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 of 15(d) of the
Securities Exchange Act of 1934
August 6, 1996
(Date of earliest event reported)
SAFETY COMPONENTS INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
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DELAWARE 0-23938 33-0596831
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification No.)
3190 Pullman Street 92626
Costa Mesa, California (Zip Code)
(Address of principal executive offices)
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Registrant's telephone number, including area code (714) 662-7756
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ITEM 2. Acquisition or Disposition of Assets.
ACQUISITION OF PHOENIX AIRBAG GmbH
Effective August 6, 1996, Safety Components International, Inc., a Delaware
Corporation (the "Registrant"), acquired eighty percent (80%) of the outstanding
capital stock of Phoenix Airbag GmbH ("Phoenix Airbag"), a corporation organized
under the laws of the Republic of Germany, a wholly owned subsidiary of Phoenix
Aktiengesellshaft ("Phoenix") of Hamburg, Germany, from Phoenix in accordance
with the terms and conditions of the Agreement Concerning the Sale and Transfer
of all the Shares in Phoenix Airbag GmbH ("Stock Purchase Agreement") dated June
6, 1996, by and among a wholly-owned subsidiary of the Registrant and Phoenix.
Phoenix Airbag currently supplies driver side, passenger side and side impact
airbags to two major European airbag systems suppliers for inclusion in various
vehicle models manufactured by several European automobile manufacturers,
including Mercedes, BMW, Audi, Opel, Volkswagen and Porsche. Phoenix Airbag has
a highly automated manufacturing facility located in Hildesheim, Germany. In
addition to manufacturing airbags, Phoenix Airbag is involved in research and
development relating to the design of new airbag products. The Registrant
intends for Phoenix Airbag to continue designing, manufacturing and selling such
products.
Pursuant to the Stock Purchase Agreement, a wholly owned subsidiary of the
Registrant has acquired eighty percent (80%) of Phoenix's interest in Phoenix
Airbag for a purchase price of approximately $22 million, subject to a net worth
adjustment. Although the Registrant will acquire the remaining twenty percent
(20%) interest effective December 31, 1998, it is entitled to all of the income
of Phoenix Airbag from August 6, 1996. The additional purchase price of up to
approximately $7.5 million for the remaining twenty percent (20%) interest is
contingent on Phoenix Airbag meeting certain performance targets during calendar
years 1996 through 1998. If the annual targets are met, payments will be paid
annually commencing April 30, 1997. If the targets are not met, the Registrant
will acquire the remaining twenty percent (20%) without the payment of any
additional consideration. Additionally, the Registrant will, under certain
circumstances, be required to provide a bank guaranty, in August 1997, to secure
the payment of up to approximately $4 million of the contingent purchase price.
The purchase price and all other terms and conditions of the Stock Purchase
Agreement were determined pursuant to arms-length negotiations between the
parties to the transaction.
The majority of the funds used by the Registrant to pay the initial cash portion
of the purchase price were borrowed by the Registrant from Bank of America
National Trust and Savings Association under a loan agreement dated August 1,
1996. This loan agreement replaces the credit facility the Registrant had with
Citicorp USA, Inc., pursuant to a Credit Agreement dated March 15, 1996.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) and (b) Financial Statement and Pro Forma Financial Information
At this time, it is impractical to file the required financial
statements and pro forma information. Such information will be
filed as soon as practicable, but no later than sixty (60) days
after the date on which this Report on Form 8-K must be filed.
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(c) Exhibits
Exhibit 1: Agreement Concerning the Sale and Transfer of all the
Shares in Phoenix Airbag GmbH (Stock Purchase
Agreement), dated June 6, 1996 (incorporated by
reference from the Registrant's Form 10-K for fiscal
year ended March 31, 1996, as filed with the
Securities and Exchange Commission).
Exhibit 2: Amendment to the Agreement Concerning the Sale and
Transfer of all the Shares in Phoenix Airbag GmbH
(Stock Purchase Agreement), dated June 6, 1996
(incorporated by reference from the Registrant's Form
10-K for fiscal year ended March 31, 1996, as filed
with the Securities and Exchange Commission).
Exhibit 3: Loan Agreement between the Company, Automotive Safety
Components International, Inc. and ASCI Holdings
Germany (DE), Inc. and Bank of America National Trust
and Savings Association dated August 1, 1996
(incorporated by reference from the Registrant's Form
10-Q for fiscal quarter ended June 30, 1996, as filed
with the Securities and Exchange Commission.
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.
SAFETY COMPONENTS INTERNATIONAL, INC.
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Date: August 21, 1996 BY: /s/ W. Hardy Myers
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W. Hardy Myers
Chief Financial Officer
(Principal Accounting Officer)
