Simmons Bedding Company Seeks Forbearance Agreement with its Senior Lenders in Order to Continue Negotiations of an Amendment of Financial Covenants into 2010 Third Quarter Earnings Release Delayed
Xxxxxxx
Bedding Company Seeks Forbearance Agreement with its Senior Lenders in Order to
Continue Negotiations of an Amendment of Financial Covenants into
2010
Third
Quarter Earnings Release Delayed
_________________________________________________________________
ATLANTA,
November 11, 2008 – Xxxxxxx Bedding Company (“Xxxxxxx Bedding”), a subsidiary of
Xxxxxxx Company (“Simmons” or the “Company”) and a leading manufacturer of
premium-branded bedding products, announced that it is currently in discussions
with its senior lenders with respect to a forbearance agreement related to the
senior credit facility in order to have more time to negotiate the terms of an
amendment which will include revised financial covenants into
2010. As a result, the Company will delay its earnings release for
the third quarter and nine months ended September 27, 2008, which was previously
scheduled for after the close of business today.
About Xxxxxxx
Company
Atlanta-based
Xxxxxxx Company, through its indirect subsidiary Xxxxxxx 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®. Xxxxxxx
Bedding Company operates 19 conventional bedding manufacturing facilities and
two juvenile bedding manufacturing facilities across the United States, Canada
and Puerto Rico. Xxxxxxx 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 xxx.xxxxxxx.xxx.
“Safe
Harbor” Statement under Private Securities Litigation Reform Act of
1995:
This
press release includes forward-looking statements that reflect Xxxxxxx 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 press release
speak only as of the date of this report. These forward-looking statements are
expressed in good faith and Simmons 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 Xxxxxxx’x 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 Xxxxxxx’x 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 Xxxxxxx’x debt
agreements; (vii) Xxxxxxx’x ability to obtain a waiver or modification of
its covenants on acceptable terms, on a timely basis or at all; (viii) increased
cost of credit and associated fees resulting from any waiver or modification to
the senior credit facility by the lenders; (ix) lender calls requiring
Xxxxxxx 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 Xxxxxxx’x subordinated notes and discount notes and
Xxxxxxx Holdco’s Toggle Loan; (x) Xxxxxxx’x relationships with and viability of
its major suppliers; (xi) fluctuations in Xxxxxxx’x costs of raw materials and
energy prices; (xii) Xxxxxxx’x relationship with and viability of significant
customers and licensees; (xiii) Xxxxxxx’x ability to increase prices on its
products and the effect of these price increases on its unit sales; (xiv) an
increase in Xxxxxxx’x return rates and warranty claims; (xv) Xxxxxxx’x labor
relations; (xvi) encroachments on Xxxxxxx’x intellectual property; (xvii)
Xxxxxxx’x product liability claims; (xviii) Xxxxxxx’x level of indebtedness;
(xix) foreign currency exchange rate risks; (xx) Xxxxxxx’x future acquisitions;
(xxi) Xxxxxxx’x 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) Xxxxxxx Bedding may not be able to obtain a forbearance agreement on
acceptable terms, timely basis or at all; and (xxiv) other risks and factors
identified from time to time in Xxxxxxx’x 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.
