UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 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): April 27, 2009
SOURCE
INTERLINK COMPANIES, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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001-13437
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20-2428229
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(State
or other jurisdiction
of
incorporation)
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(Commission
File Number)
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(IRS
Employer
Identification
No.)
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27500
Riverview Center Blvd.,
Suite
400, Bonita Springs, Florida 34134
(Address
of Principal executive offices, including Zip Code)
(239)
949-4450
(Registrant’s
telephone number, including area code)
N/A
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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ITEM
1.01 Entry Into a Material Definitive Agreement
The
information required under Item 1.01 is included under Item 2.03 of this report
and is incorporated herein by reference.
ITEM
1.03 Bankruptcy or Receivership
On April
27, 2009, Source Interlink Companies, Inc. (the “Company”) and each of its U.S.
subsidiaries (collectively with the Company, the “Debtors”) filed voluntary
petitions in the United States Bankruptcy Court for the District of Delaware
seeking relief under the provisions of Chapter 11 of the United States
Bankruptcy Code (collectively, the "Chapter 11 Case"). The title of the Chapter
11 Case and case number assigned to the Company is
In re Source Interlink Companies,
Inc., et al
and 09-11424, respectively. The Chapter 11 Case
was filed pursuant a joint prepackaged plan that has been approved by 100% of
the lenders holding outstanding claims under the Company’s Term Credit Agreement
dated as of August 1, 2007 by and among the Company, as borrower, and each of
the other Debtors, as guarantors, Citicorp North America, Inc., as
administrative agent, and the lenders party thereto (the “Term Credit
Agreement”). The Chapter 11 Case will be jointly administered and the
Company and its U.S. subsidiaries intend to operate their businesses as
debtors-in-possession under the jurisdiction of the Bankruptcy Court and in
accordance with the applicable provisions of the Bankruptcy Code and the orders
of the Bankruptcy Court. The Company's foreign subsidiary was not included in
the Chapter 11 filings.
On April
28, 2009, the Company issued a press release discussing the Chapter 11 Case. A
copy of the Company’s press release is furnished with this Current Report on
Form 8-K, is attached hereto as Exhibit 99.1.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under
an Off-Balance sheet Arrangement of a Registrant.
Certain
of the Company’s lenders under its current credit facilities (the “DIP Lenders”)
have entered into a Term Sheet (the “DIP Term Sheet”) for a Debtor-in-Possession
Credit Facility with the Debtors. The DIP Term Sheet is filed
herewith as Exhibit 10.1 and is incorporated herein by reference. The
DIP Term Sheet provides, subject to approval by the Bankruptcy Court and certain
other conditions described in the DIP Term Sheet, for a super-priority senior
secured multiple-draw term loan facility in an aggregate principal amount of
$85,000,000 and a super-priority senior secured revolving credit facility in an
aggregate principal amount of up to $300,000,000, subject to the amount of the
borrowing base as calculated in the DIP Term Sheet (the “DIP
Facility”). Proceeds of the DIP Facility will be used, among other
things, to (i) to pay fees and expenses associated with the DIP Facility, (ii)
to provide working capital from time to time for the Company and its
subsidiaries and for other general corporate purposes during the pendency of the
Chapter 11 Case, and (iii) for certain permitted uses in connection with the
consummation of a plan of reorganization.
The DIP
Facility is subject to the entry of an order by the Bankruptcy Court approving
the DIP Facility on terms and conditions acceptable to the DIP Lenders in their
sole discretion. In addition, the DIP Facility is subject to the
satisfaction of a number of material conditions precedent set forth in the DIP
Term Sheet filed herewith and incorporated herein by reference.
Item
2.04 Triggering Events That Accelerate or
Increase a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement.
On April
27, 2009, the Company filed a voluntary petition for reorganization relief under
chapter 11 of the Bankruptcy Code in Bankruptcy Court, as described in Item 1.03
above. The filing of the bankruptcy petition constituted an event of
default under each of the following agreements: (1) Revolving Credit Agreement
dated as of August 1, 2007 by and among the Company, as borrower, and each of
the other Debtors, as guarantors, Citicorp North America, Inc., as
administrative agent, and the lenders party thereto (as amended, the “Revolving
Credit Agreement”); and (2) the Term Credit Agreement. Approximately
$149 million is currently outstanding
under the
Revolving Credit Agreement (excluding approximately $32 million in Letters of
Credit) and approximately $867 million is currently outstanding under the Term
Credit Agreement.
In
addition, the Company is party to the Indenture dated as of June 23, 2008 by and
among the Company, as issuer, and each of the other Debtors, as
guarantors, and HSBC Bank USA, National Association, as trustee, related to
the Company’s currently outstanding $465 million in 11.25% senior unsecured
notes due 2015 (the “Senior Notes”). The filing of the bankruptcy
petition constituted an event of default under the terms of the indenture, and
as a result of such event of default, the outstanding principal amount thereof,
and accrued interest thereon, is immediately due and payable, without any other
action required by the trustee or holders of Senior Notes.
The
Company believes that any efforts to enforce payment obligations under the
Revolving Credit Agreement, Term Credit Agreement, Senior Notes and Trade
Security Agreements are stayed as a result of the filing of the bankruptcy
petition.
(d) Exhibits
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Description
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10.1
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Debtor
in Possession Credit Facility Term Sheet
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99.1
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Press
release issued by Source Interlink Companies, Inc. on April 28,
2009.
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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.
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SOURCE
INTERLINK COMPANIES, INC.
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/s/ Marc Fierman
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Date:
May 1, 2009
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Name:
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Marc Fierman
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Title:
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Chief Financial Officer
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EXHIBIT
INDEX
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Description
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10.1
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Debtor
in Possession Credit Facility Term Sheet
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99.1
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Press
release issued by Source Interlink Companies, Inc. on April 28,
2009.
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