Simmons Bedding Company Obtains Extension of Forbearance Period to March 31, 2009
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Bedding Company Obtains Extension of Forbearance Period to March 31,
2009
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ATLANTA,
December 9, 2008 – ▇▇▇▇▇▇▇ Bedding Company (“▇▇▇▇▇▇▇ Bedding”), a subsidiary of
▇▇▇▇▇▇▇ Company (“Simmons” or the “Company”) and a leading manufacturer of
premium-branded bedding products, today announced that it has reached an
agreement with its senior lenders to extend the current forbearance period to
March 31, 2009, subject to the terms thereof. ▇▇▇▇▇▇▇ expects the new
agreement pertaining to the forbearance extension to take effect on December 10,
2008.
As
previously announced, the forbearance period extension is designed to
provide the Company with sufficient time to reduce
the leverage on its balance sheet by
pursuing an organized financial restructuring. ▇▇▇▇▇▇▇ plans to work with its various stakeholders to
design and implement the restructuring in a manner that maximizes value and
preserves and protects its relationships with customers and
suppliers.
The final form of agreement providing
for the extended forbearance period will be attached as an Exhibit to the Form
8-K that will be filed on December 10, 2008 by Simmons with the U.S. Securities
and Exchange Commission.
About ▇▇▇▇▇▇▇ Company
Atlanta-based
▇▇▇▇▇▇▇ Company, through its indirect subsidiary ▇▇▇▇▇▇▇ Bedding Company, is one
of the world's largest mattress manufacturers, manufacturing and marketing a
broad range of products including Beautyrest®, Beautyrest Black®, Beautyrest
Studio™, ComforPedic by Simmons™, Natural Care®, Beautyrest Beginnings™ and Deep
Sleep®. ▇▇▇▇▇▇▇ Bedding Company operates 19 conventional bedding manufacturing
facilities and two juvenile bedding manufacturing facilities across the United
States, Canada and Puerto Rico. ▇▇▇▇▇▇▇ also serves as a key supplier of beds to
many of the world’s leading hotel groups and resort properties. Simmons is
committed to developing superior mattresses and promoting a higher quality sleep
for consumers around the world. For more information, visit the Company's
website at ▇▇▇.▇▇▇▇▇▇▇.▇▇▇.
This news
release includes forward-looking statements that reflect ▇▇▇▇▇▇▇ Company and its
subsidiaries’ (collectively referred to as “Simmons”) current views about future
events and financial performance. Words such as “estimates,” “expects,”
“anticipates,” “projects,” “plans,” “intends,” “believes,” “forecasts” and
variations of such words or similar expressions that predict or indicate future
events, results or trends, or that do not relate to historical matters, identify
forward-looking statements. The forward-looking statements in this report speak
only as of the date of this report. These forward-looking statements are
expressed in good faith and ▇▇▇▇▇▇▇ believes there is a reasonable basis for
them. However, there can be no assurance that the events, results or trends
identified in these forward-looking statements will occur or be achieved.
Investors should not rely on forward-looking statements because they are subject
to a variety of risks, uncertainties, and other factors that could cause actual
results to differ materially from ▇▇▇▇▇▇▇’▇ expectations. These
factors include, but are not limited to: (i) competitive pressures in the
bedding industry; (ii) general economic and industry conditions; (iii) the
success of ▇▇▇▇▇▇▇’▇ new products and the future costs to roll out such
products; (iv) legal and regulatory requirements; (v) interest rate and credit
market risks; (vi) compliance with covenants in, and any defaults
under, ▇▇▇▇▇▇▇’▇ debt agreements or instruments; (vii) ▇▇▇▇▇▇▇’▇ ability to
finalize an extension to its forbearance agreement with its senior lenders or
a waiver or modification of its covenants on acceptable terms, on a timely
basis or at all and ▇▇▇▇▇▇▇’▇ ability to develop and implement an organized
financial restructuring on acceptable terms, on a timely basis or at
all; (viii) increased cost of credit and associated fees resulting from the
forbearance extension and any waiver or modification of the senior
credit facility by the lenders; (ix) lender calls requiring ▇▇▇▇▇▇▇ to
immediately repay all amounts outstanding under the senior credit facility
resulting from the noncompliance with the covenants which could in turn result
in a default under ▇▇▇▇▇▇▇’▇ subordinated notes and discount notes and ▇▇▇▇▇▇▇
Holdco’s term loan facility; (x) ▇▇▇▇▇▇▇’▇ relationships with and viability of
its major suppliers; (xi) fluctuations in ▇▇▇▇▇▇▇’▇ costs of raw materials and
energy prices; (xii) ▇▇▇▇▇▇▇’▇ relationship with and viability of significant
customers and licensees; (xiii) ▇▇▇▇▇▇▇’▇ ability to increase prices on our
products and the effect of these price increases on its unit sales; (xiv) an
increase in ▇▇▇▇▇▇▇’▇ return rates and warranty claims; (xv) ▇▇▇▇▇▇▇’▇ labor
relations; (xvi) encroachments on ▇▇▇▇▇▇▇’▇ intellectual property; (xvii)
▇▇▇▇▇▇▇’▇ product liability claims; (xviii) ▇▇▇▇▇▇▇’▇ level of indebtedness;
(xix) foreign currency exchange rate risks; (xx) ▇▇▇▇▇▇▇’▇ future acquisitions;
(xxi) ▇▇▇▇▇▇▇’▇ ability to achieve the expected benefits from any personnel
realignments; (xxii) higher bad debt expense as a result of increased customer
bankruptcies due to instability in the economy and slowing consumer spending;
(xxiii) financial results for the third quarter of 2008 could materially differ
from the preliminary results; and (xxiv) other risks and factors identified from
time to time in ▇▇▇▇▇▇▇’▇ reports filed with the Securities and Exchange
Commission. We undertake no obligation to update or revise any forward-looking
statements, either to reflect new developments or for any other
reason.
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