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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) September 28, 1998
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CROWN VANTAGE INC.
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(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Virginia 1-13868 54-1752384
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
300 Lakeside Drive, Oakland CA 94612-3592
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(Address of principal executive offices) (Zip Code)
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Registrant's telephone number, including area code (510) 874-3400
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Not Applicable
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
On September 28, 1998 Crown Paper Co. (a wholly owned subsidiary of Crown
Vantage Inc.) received consents from holders of its 11% Senior Subordinated
Notes due 2005 and consummated the settlement with Fort James Corporation for
the return of $33 million of Crown Vantage's 11.45% Senior Pay-In-Kind Notes
(the "PIK Notes"). The company's bank lenders had previously provided their
consent. The consents were for amendments of certain terms of the related
indentures to permit the settlement to occur. The settlement involved the
return of these PIK Notes by Fort James in exchange for the mutual release from
a variety of claims that have arisen from prior intercompany transactions. The
settlement also amends the terms of the remaining PIK Notes allowing Crown
Vantage the right to call the remaining PIK Notes at fair value at any time
prior to their maturity.
Crown Vantage expects to record a pretax extraordinary gain in the fourth
quarter of 1998 of approximately $33 million, which will be partially offset by
transaction fees. Returned PIK Notes valued at approximately $25 million will be
extinguished by Crown Vantage. The remaining $8 million in returned PIK Notes
will be carried on the books of Crown Paper, but will be eliminated in the
consolidated Crown Vantage financial statements.
Crown Vantage also announced on September 28, 1998 that it will not
exercise the option portion of the settlement agreement for the return of the
remaining PIK Notes with a face value of $107 million held by Fort James. The
option, which expired on September 30, 1998, would have allowed the company to
purchase these notes for $80 million in cash.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
Exhibit No. Description
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None None
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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.
CROWN VANTAGE INC.
October 5, 1998 /s/ Michael J. Hunter
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Michael J. Hunter
Vice President, Chief Accounting Officer
