SAFETY COMPONENTS INTERNATIONAL ANNOUNCES
EMERGENCE FROM BANKRUPTCY
GREENVILLE, S.C., October 11, 2000 /PRNewswire/ - Safety Components
International, Inc. (OTCBB:ABAG) and certain of its United States subsidiaries,
including Safety Components Fabric Technologies, Inc. and Automotive Safety
Components International, Inc. (collectively, "Safety Components"), a leading,
low cost supplier of automotive airbag fabric and cushions in the United States,
announced today that they have emerged from their chapter 11 cases pursuant to
their plan of reorganization approved by the District Court of the State of
Delaware on August 31, 2000 (the "Plan").
Pursuant to the Plan, all of the 10-1/8% senior notes due 2007 issued by
the Company, amounting to almost $97 million, have been converted into 96.8% of
the Company's post-bankruptcy equity and the holders of the Company's
pre-bankruptcy common stock, excluding Robert Zummo (former Chairman of the
Company), have received 3.2% of the Company's post-bankruptcy equity and
warrants to acquire an additional 12% of such equity. All trade suppliers and
other creditors will be paid in full pursuant to the terms of the Plan within 90
days.
In connection with its emergence, Safety Components announced the closing
of a three-year $35 million credit facility with Congress Financial Corporation
(Southern). The Congress facility has allowed the Company to pay off its
debtor-in-possession credit facility with Bank of America and is expected to
provide adequate funding for Safety Components' ongoing global operating needs.
In addition to the Congress facility, Safety also closed a two-year subordinated
secured note facility with its pre-bankruptcy secured lenders for $20.9 million.
Safety Components' Board of Directors, in accordance with the terms of the
Plan, now consists of the following new non-employee directors: Carroll R.
Wetzel, Jr. (Chairman), Andy Goldfarb, W. Allan Hopkins and Ben E. Waide III.
John C. Corey continues as a director and has been promoted to Chief Executive
Officer and President of the Company.
Mr. Wetzel, Chairman, stated "We are pleased that the Company has emerged
from its chapter 11 case in accordance with its schedule and that the management
team lead by John Corey has done such an excellent job in turning the Company
around."
Mr. Corey stated "The Company's operations have continued to improve over
the past few months, exceeding our projections. The Company's operating results
and the flexible credit arrangements provided by Congress Financial have placed
the Company in a solid financial position and we are now able to return our
primary focus to the fulfillment of our goals: increasing productivity and
profitability from the core airbag automotive business; capitalizing on
continuing growth opportunities in the airbag automotive business and divesting
non-core operations. We believe that the broad and varied business experiences
of the incoming members of the Board enhance our ability to fulfill these goals.
We also would like to express our appreciation to Robert Zummo, the Company's
founder, and to Joseph DioGuardi, and Robert Torok, former directors, for their
invaluable assistance on behalf of the Company during the chapter 11 cases." Mr.
Corey continued, "We are also very appreciative for all of the support
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provided by our customers, suppliers, employees and advisors during the past few
months, which has enabled the Company to emerge from chapter 11 on a timely
basis."
This press release contains forward-looking statements. The Company wishes
to caution the reader of this press release that such forward looking statements
are subject to various known and unknown risks and uncertainties, including the
possibility that the Company's stated goals will not be fulfilled in whole or in
part. Additional information on factors that could potentially affect the
Company's financial results may be found in the Company's filings with the
Securities and Exchange Commission.
