-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EOu/ifYhZdC4d81z1PlSl2LWtTlduioapex618/nn8/Yia4sXD+tPmwvBNpPTadN hvglRAPfOmndt3kdi0Lwmw== 0000893750-99-000436.txt : 19990811 0000893750-99-000436.hdr.sgml : 19990811 ACCESSION NUMBER: 0000893750-99-000436 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990627 FILED AS OF DATE: 19990810 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GPC CAPITAL CORP II CENTRAL INDEX KEY: 0001061504 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS PLASTIC PRODUCTS [3080] IRS NUMBER: 232952404 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-53603-01 FILM NUMBER: 99682917 BUSINESS ADDRESS: STREET 1: 1110 EAST PRINCESS STREET CITY: YORK STATE: PA ZIP: 17403 BUSINESS PHONE: 7178498500 MAIL ADDRESS: STREET 1: 110 EAST PRINCESS STREET CITY: YORK STATE: PA ZIP: 17403 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549-1004 FORM 10-Q (Mark One) [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 27, 1999 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________________ to ____________________ Commission file number: 333-53603-01 GPC CAPITAL CORP. II (Exact name of registrant as specified in its charter) Delaware 23-2952404 (State or other (I.R.S. Employer jurisdiction of Identification No.) incorporation or organization) 2401 Pleasant Valley Road York, Pennsylvania (Address of principal executive offices) 17402 (zip code) (717) 849-8500 (Registrant's telephone number, including area code) Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] As of the date hereof, 1,000 shares of the registrant's common stock, par value $.01 per share, are outstanding. GPC CAPITAL CORP. II INDEX PART I. FINANCIAL INFORMATION Page Number ITEM 1: Condensed Financial Statements: CONDENSED BALANCE SHEETS - At June 27, 1990 and December 31, 1998 . . . . . 3 CONDENSED STATEMENTS OF OPERATIONS - For the Three Months and Six Months Ended June 27, 1999 and June 28, 1998 . . . . . . . . . . . . . . . . . . 4 CONDENSED STATEMENTS OF SHAREHOLDER'S EQUITY - For the Year Ended December 31, 1998 and Six Months Ended June 27, 1999 . . . . . . . . . . . 5 CONDENSED STATEMENT OF CASH FLOWS - For the Six Months Ended June 27, 1999 and June 28, 1998 . . . . . . . . . . . . . . . . . . . . 6 NOTES TO CONDENSED FINANCIAL STATEMENTS . . . . . . . 7 Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . 8 Item 3: Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . . . . . . . . . . . . . . 11 PART II. OTHER INFORMATION Item 6: Exhibits and Reports on Form 8-K . . . . . . . . . . . . . 12 Signature: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 -2- PART I. FINANCIAL INFORMATION Item 1. Condensed Financial Statements GPC CAPITAL CORP. II CONDENSED BALANCE SHEET (in thousands) (Unaudited)
June 27, December 31, 1999 1998 ----------- ------------- Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- -- Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- -- Commitments and contingencies . . . . . . . . . . . . . . . . . . . . . . . . -- -- Total shareholder's equity . . . . . . . . . . . . . . . . . . . . . . . . . -- --
See accompanying notes. -3- GPC CAPITAL CORP. II CONDENSED STATEMENTS OF OPERATIONS (in thousands) (Unaudited)
Three Months Ended Six Months Ended -------------------------- --------------------------- June 27, June 28, June 27, June 28, 1999 1998 1999 1998 ---------- --------- --------- --------- Net sales -- -- -- -- Operating income . . . . . . . . . . . . . . . . . . . -- -- -- -- Interest expense, net . . . . . . . . . . . . . . . . . -- -- -- -- Net income . . . . . . . . . . . . . . . . . . . . . . -- -- -- --
See accompanying notes. -4- GPC CAPITAL CORP. II CONDENSED STATEMENTS OF SHAREHOLDER'S EQUITY (in thousands) (Unaudited)
Balance at February 2, 1998 -- Balance at December 31, 1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- Balance at June 27, 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . --
See accompanying notes. -5- GPC CAPITAL CORP. II CONDENSED STATEMENT OF CASH FLOWS (in thousands) (Unaudited)
Six Months Ended ------------------------------------ June 27, June 28, 1999 1998 ---------- ----------- Operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- -- Investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- -- Financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- --
See accompanying notes. -6- GPC CAPITAL CORP. II NOTES TO CONDENSED FINANCIAL STATEMENTS (Unaudited) June 27, 1999 1. Basis of Presentation The accompanying unaudited condensed financial statements of GPC Capital Corp. II have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X and therefore do not include all of the information and footnotes required by generally accepted accounting principles for complete annual financial statements. In the opinion of management, all adjustments (consisting only of usual recurring adjustments considered necessary for a fair presentation) are reflected in the condensed financial statements. GPC Capital Corp. II, a wholly owned subsidiary of Graham Packaging Holdings Company, a Pennsylvania limited partnership formerly known as Graham Packaging Company ("Holdings"), was incorporated in Delaware in January 1998. The sole purpose of GPC Capital Corp. II is to act as co- obligor with Holdings of the Senior Discount Notes and as a co-guarantor with Holdings under the New Credit Agreement and Amendment (as defined herein). GPC Capital Corp. II has only nominal assets and does not conduct any independent operations. GPC Capital Corp. II has authorized and issued 1,000 shares of common stock with a par value of $.01 per share. For additional information, see the related Quarterly Report on Form 10-Q of Holdings for the quarter ended June 27, 1999. 2. Debt Arrangements On February 2, 1998, Holdings and GPC Capital Corp. II, as co- obligor, issued $100.6 million gross proceeds of Senior Discount Notes Due 2009 ($169 million aggregate principal amount at maturity). The Senior Discount Notes mature on January 15, 2009, with interest payable at 10.75%. Cash interest on the Senior Discount Notes does not accrue until January 15, 2003. On February 2, 1998, Graham Packaging Company, a Delaware limited partnership formerly known as Graham Packaging Holdings I, L.P. (the "Operating Company"), refinanced the majority of Holdings' existing credit facilities and entered into a new Credit Agreement (the "New Credit Agreement") with a consortium of banks. The New Credit Agreement was amended on August 13, 1998 (the "Amendment") to provide for an -7- additional Term Loan Borrowing of up to an additional $175 million which can be drawn in two installments (of which $175 million was drawn and outstanding as of June 27, 1999). A commitment fee of .75% is due on the unused portion. The New Credit Agreement and the Amendment consist of four term loans to the Operating Company totaling up to $570 million and two revolving loan facilities to the Operating Company totaling $255 million. The obligations of the Operating Company under the New Credit Agreement and Amendment are guaranteed by Holdings and certain other subsidiaries of Holdings. The term loans are payable in quarterly installments through January 31, 2007, required a payment of $3.2 million in 1998, and require payments of $5.0 million in 1999, $15.0 million in 2000, $20.0 million in 2001, $25.0 million in 2002 and $27.5 million in 2003. The revolving loan facilities expire on January 31, 2004. Interest is payable at (a) the "Alternate Base Rate" (the higher of the Prime Rate or the Federal Funds Rate plus 0.50%) plus a margin ranging from 0% to 2.00%; or (b) the "Eurocurrency Rate" (the applicable interest rate offered to banks in the London interbank eurocurrency market) plus a margin ranging from 0.625% to 3.00%. A commitment fee ranging from 0.20% to 0.50% is due on the unused portion of the revolving loan commitment. As part of the Amendment to the New Credit Agreement, if certain events of default were to occur (including, without limitation, if the Company's Net Leverage Ratio were above 5.15:1.0 at March 31, 2000), Blackstone Capital Partners III Merchant Banking Fund L.P. ("Blackstone") has agreed to make an equity contribution to the Company through the administrative agent of up to $50 million. In addition, the New Credit Agreement and Amendment contain certain affirmative and negative covenants as to the operations and financial condition of the Operating Company, as well as certain restrictions on the payment of dividends and other distributions to Holdings. On September 8, 1998, Holdings and GPC Capital Corp. II consummated an exchange offer for all of their outstanding Senior Discount Notes Due 2009 which had been issued on February 2, 1998 (the "Old Notes"), and issued in exchange therefor their Senior Discount Notes Due 2009, Series B (the "Exchange Notes", and, together with the Old Notes, the "Senior Discount Notes"), which have the same terms as the Old Notes, except that the Exchange Notes are registered under the Securities Act of 1933 and do not include the restrictions on transfer applicable to the Old Notes. Item 2. Management's Discussion and Analysis of Financial Condition And Results of Operations Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995 The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain "forward-looking statements". This Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All -8- statements other than historical facts included in this Report on Form 10-Q, including without limitation, statements regarding the Company's future financial position, business strategy, anticipated capital expenditures, anticipated business acquisitions, projected costs and plans and objectives of management for future operations, are forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", or "continue" or the negative thereof or variations thereon or similar terminology. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, the Company can give no assurance that such expectations will prove to have been correct. Unless the context otherwise requires, all references herein to the "Company", with respect to periods prior to the Recapitalization, refer to the business historically conducted by Holdings (which served as the operating entity for the business prior to the Recapitalization) and one of its predecessors (Graham Container Corporation), together with Holdings' subsidiaries and certain affiliates, and, with respect to periods subsequent to the Recapitalization, refer to Holdings and its subsidiaries. Results of Operations None Liquidity and Capital Resources On February 2, 1998, Holdings and GPC Capital Corp. II, as co-obligor, issued $100.6 million gross proceeds of Senior Discount Notes Due 2009 ($169 million aggregate principal amount at maturity). The Senior Discount Notes mature on January 15, 2009, with interest payable at 10.75%. Cash interest on the Senior Discount Notes does not accrue until January 15, 2003. On February 2, 1998, Graham Packaging Company, a Delaware limited partnership formerly known as Graham Packaging Holdings I, L.P. (the "Operating Company"), -9- refinanced the majority of its existing credit facilities and entered into a new Credit Agreement (the "New Credit Agreement") with a consortium of banks. The New Credit Agreement was amended on August 13, 1998 (the "Amendment") to provide for an additional Term Loan Borrowing of up to an additional $175 million which can be drawn in two installments (of which $175 million was drawn and outstanding as of June 27, 1999). A commitment fee of.75% is due on the unused portion. The New Credit Agreement and the Amendment consist of four term loans to the Operating Company totaling up to $570 million and two revolving loan facilities to the Operating Company totaling $255 million. The obligations of the Operating Company under the New Credit Agreement and Amendment are guaranteed by Holdings and certain other subsidiaries of Holdings. The term loans are payable in quarterly installments through January 31, 2007, required a payment of $3.2 million in 1998, and require payments of $5.0 million in 1999, $15.0 million in 2000, $20.0 million in 2001, $25.0 million in 2002 and $27.5 million in 2003. The revolving loan facilities expire on January 31, 2004. Interest is payable at (a) the "Alternate Base Rate" (the higher of the Prime Rate or the Federal Funds Rate plus 0.50%) plus a margin ranging from 0% to 2.00%; or (b) the "Eurocurrency Rate" (the applicable interest rate offered to banks in the London interbank eurocurrency market) plus a margin ranging from 0.625% to 3.00%. A commitment fee ranging from 0.20% to 0.50% is due on the unused portion of the revolving loan commitment. As part of the Amendment to the New Credit Agreement, if certain events of default were to occur (including, without limitation, if the Company's Net Leverage Ratio were above 5.15:1.0 at March 31, 2000), Blackstone has agreed to make an equity contribution to the Company through the administrative agent of up to $50 million. In addition, the New Credit Agreement and Amendment contain certain affirmative and negative covenants as to the operations and financial condition of the Operating Company, as well as certain restrictions on the payment of dividends and other distributions to Holdings. On September 8, 1998, Holdings and GPC Capital Corp. II consummated an exchange offer for all of their outstanding Senior Discount Notes Due 2009 which had been issued on February 2, 1998 (the "Old Notes"), and issued in exchange therefor their Senior Discount Notes Due 2009, Series B (the "Exchange Notes"), which have the same terms as the Old Notes, except that the Exchange -10- Notes are registered under the Securities Act of 1933 and do not include the restrictions on transfer applicable to the Old Notes. Under the New Credit Agreement and Amendment, the Operating Company is subject to restrictions on the payment of dividends or other distributions to Holdings; provided that, subject to certain limitations, the Operating Company may pay dividends or other distributions to Holdings (i) in respect of overhead, tax liabilities, legal, accounting and other professional fees and expenses, (ii) to fund purchases and redemptions of equity interests of Holdings or Investor LP held by then present or former officers or employees of Holdings, the Operating Company or their Subsidiaries (as defined) or by any employee stock ownership plan upon such person's death, disability, retirement or termination of employment or other circumstances with certain annual dollar limitations and (iii) to finance, starting on July 15, 2003, the payment of cash interest payments on the Senior Discount Notes. Item 3. Quantitative and Qualitative Disclosures About Market Risk Not applicable. -11- PART II OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits Exhibit 27 Financial Data Schedule (b) Reports on Form 8-K No reports on Form 8-K were required to be filed during the quarter ended June 27, 1999. -12- SIGNATURE 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 thereunto duly authorized. Dated: August 10, 1999 GPC CAPITAL CORP. II (Registrant) BY: /S/ John E. Hamilton -------------------------- John E. Hamilton Vice President (chief accounting officer and duly authorized officer) -13- EX-27 2
5 1,000 YEAR 6-MOS DEC-31-1998 DEC-31-1999 DEC-31-1998 JUN-27-1999 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.00 0.00 0.00 0.00
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