PaperWorks Industries, Inc. Announces Finalization of Deleveraging and Recapitalization Transaction

– Recapitalization supported by 98.7% of Noteholders and reduced debt by 70%

– New capital structure provides foundation for future growth and strategic opportunities

 

On February 28th, 2018, PaperWorks Industries, Inc. and certain of its affiliates (collectively, “PaperWorks” or the “Company”) completed a comprehensive financial restructuring of the Company’s debt and equity. Among other things, the proposed restructuring reduced the Company’s funded indebtedness by approximately $280 million or 70%, through a repayment of the Company’s existing ABL credit facility and an exchange of the Company’s 9.5% Senior Secured Notes due in August 2019 (the “Notes”) for new debt and new common equity in the reorganized Company. The Company’s new capital structure consists of a $114 million term-loan due in February 2023, inclusive of $70 million of new capital.

“The completion of this transaction provides a strong and financially flexible capital structure that provides sufficient liquidity to operate and grow our business and enables us to maximize value for our stakeholders,” said C. Anderson “Andy” Bolton, President and Chief Executive Officer of the Company.  “Our new ownership group is excited to partner with us as we drive our growth strategy.  We are committed to providing world-class solutions for our customers, enabling them to win in the marketplace. I would like to again thank our customers, vendors and employees for their patience and support as we moved through this process.”

 

Cautionary Statement Regarding Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements represent management’s current expectations and are based upon information available to the Company at the time of this press release.  Statements in this press release that are not historical or current facts are “forward?looking statements.”  Such forward-looking statements include statements using words such as “anticipate,” “expect,” “believe,” “continue,” “will,” “may,” “estimate,” “assume,” “presume,” “pursue,” “outlook,” “plan,” “goal,” “milestone” and similar expressions.  Such statements are subject to a number of risks, uncertainties and assumptions that may cause actual results, developments, or achievements to differ materially from those projected or implied in these statements including, but not limited to, potential limitations on the Company’s ability to maintain contracts and other critical business relationships; risks associated with general economic and business conditions; requirements for adequate liquidity to fund its operations in the future, including obtaining sufficient financing on acceptable terms; other matters related to its indebtedness; and the risk factors and known trends and uncertainties described in the Company’s most recent periodic reports provided to Noteholders.

Accordingly, readers should not place undue reliance on forward-looking statements.  The Company does not intend to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.