tfcform8kdated031809.htm
UNITED
STATES
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
March
18, 2009
Date
of Report (Date of earliest event reported)
Commission
File Number 1-6560
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THE
FAIRCHILD CORPORATION
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(Exact
name of Registrant as specified in its charter)
Delaware
(State of
incorporation or organization)
34-0728587
(I.R.S.
Employer Identification No.)
1750
Tysons Boulevard, Suite 1400, McLean, VA 22102
(Address
of principal executive offices)
(703)
478-5800
(Registrant’s
telephone number, including area code)
Not
Applicable
(Former
name or former address, if changed since last report)
FORWARD-LOOKING
STATEMENTS:
Certain
statements in this filing contain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995 with respect to
our financial condition, results of operation and business. These statements
relate to analyses and other information, which are based on forecasts of future
results and estimates of amounts not yet determinable. These statements also
relate to our future prospects, developments and business strategies. These
forward-looking statements are identified by their use of terms and phrases such
as ‘‘anticipate,’’ ‘‘believe,’’ ‘‘could,’’ ‘‘estimate,’’ ‘‘expect,’’ ‘‘intend,’’
‘‘may,’’ ‘‘plan,’’ ‘‘predict,’’ ‘‘project,’’ ‘‘will’’ and similar terms and
phrases, including references to assumptions. These forward-looking statements
involve risks and uncertainties, including current trend information,
projections for deliveries, backlog and other trend estimates that may cause our
actual future activities and results of operations to be materially different
from those suggested or described in this financial discussion and analysis by
management. These risks include: our ability to finance and successfully operate
our retail businesses; our ability to accurately predict demand for our
products; our ability to receive timely deliveries from vendors; our ability to
raise cash to meet seasonal demands; our dependence on the retail and aerospace
industries; our ability to maintain customer satisfaction and deliver products
of quality; our ability to properly assess our competition; our ability to
improve our operations to profitability status; our ability to liquidate
non-core assets to meet cash needs; our ability to attract and retain highly
qualified executive management; our ability to achieve and execute internal
business plans; weather conditions in Europe during peak business season and on
weekends; labor disputes; competition; foreign currency fluctuations; worldwide
political instability and economic growth; military conflicts, including
terrorist activities; infectious diseases; new legislation which may cause us to
be required to fund our pension plan earlier than we had expected; and the
impact of any economic downturns and inflation.
If
one or more of these and other risks or uncertainties materialize, or if
underlying assumptions prove incorrect, our actual results may vary materially
from those expected, estimated or projected. Given these uncertainties, users of
the information included in this report, including investors and prospective
investors, are cautioned not to place undue reliance on such forward-looking
statements. We do not intend to update the forward-looking statements included
in this filing, even if new information, future events or other circumstances
have made them incorrect or misleading.
ITEM
1.03 BANKRUPTCY OR RECEIVERSHIP
On
March 18, 2009, The Fairchild Corporation (the “Company”) and
sixty-one of its consolidated subsidiaries filed voluntary petitions in the
United States Bankruptcy Court for the District of Delaware (the “Court”) for
reorganization of its business. The Company will continue to manage
its properties and operate its business as a “debtor-in-possession” under the
jurisdiction of the Court and in accordance with Title 11 of the United States
Bankruptcy Code (the “Bankruptcy
Code”).
In
connection with the filings by the Company and its subsidiaries for protection
under the Bankruptcy Code, PNC Bank, National Association (“PNC”), as agent for
all of the lenders, and as lender to Banner Aerospace Holding Company I, Inc.
and its subsidiaries (“PNC Borrowers”), under both domestic and export-import
revolving credit facilities (collectively, the “Current Credit
Facilities”), agreed to continue to make loans and advances to the PNC
Borrowers in an aggregate amount not to exceed $23,000,000, pursuant to new
agreements substantially in the form attached to motions filed with the court
(the “DIP Financing
Agreements”), on a senior secured, super-priority basis.
The
DIP Financing Agreements are intended to provide financing to PNC Borrowers
until the consummation of a Section 363 Sale under the Bankruptcy Code, whether
to Phoenix Banner, LLC, a Delaware limited liability company, as the stalking
horse bidder (“Phoenix
Banner”) or to the bidder making the highest and best bid pursuant to the
auction conducted pursuant to bidding procedures to be approved by the
Bankruptcy Court.
Subject
to receipt of a Bankruptcy Court order approving the terms and conditions
thereof, Phoenix Banner in its capacity as junior lender (“Junior Lender”), has
agreed to provide PNC Borrowers and Fairchild Realty (“Borrowers”) with a junior
debtor-in-possession facility of up to $4,000,000, $3,000,000 of which may be
used to allow Borrowers to provide liquidity and support to the ultimate parent
of Borrowers, the Company and its debtor subsidiaries other than the Borrowers,
to make payments for other purposes as may be agreed to by the Junior Lender and
identified in the budget, to make any other payments permitted to be made by the
Bankruptcy Code, by orders approving the Junior DIP Facility or any other order
of the Bankruptcy Court to the extent not prohibited by the Junior DIP Facility,
or as otherwise consented to by the Junior Lender, subject to the budget (the
“Junior DIP
Facility”). Security for the Junior DIP Facility includes
guaranties by the Company and its debtor subsidiaries other than the
Borrowers.
ITEM
2.04 TRIGGERING EVENTS THAT ACCELERATE OR INCREASE A DIRECT FINANCIAL OBLIGATION
OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT
The
filings by the Company and certain of its subsidiaries in the Bankruptcy Court
constitute or may constitute a default or an event of default, or trigger
certain repayment obligations arising under certain debt obligations of such
parties (the “Debt
Agreements”). Upon the occurrence of such event, the
obligations arising under the Debt Agreements may accelerate and immediately
become due and payable. The Company believes that the acceleration of
the obligations under the Debt Agreements will be stayed as a result of the
filings in the Bankruptcy Court. The principal Debt Agreements
affected are:
the Current Credit Facilities, which
govern the existing domestic and export-import revolving credit lines used by
BAHCI and its subsidiaries;
the Promissory Note and Mortgage, in
the amount of $ 10,000,000, dated September 12, 2008 issued by Republic
Thunderbolt West, LLC, a subsidiary of the Company, to Acadia Strategic
Opportunity Fund III LLC; and
the Promissory Note, Mortgage, and
related documents dated July 3, 2008 in connection with a real estate loan in
the amount of $ 665,000 issued by Fairchild Realty, LLC, a subsidiary of the
Company, to INTRUST Bank, N.A.
[Remainder
of page intentionally left blank.]
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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.
| Dated:
March 24,
2009 |
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THE
FAIRCHILD CORPORATION |
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By:
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/s/ DONALD E. MILLER |
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Name:
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Donald E. Miller |
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Title:
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Chief Restructuring Officer and
Secretary |