Intermet (NASDAQ:INMTQ)
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INTERMET Lenders Approve Cash Collateral Extension
Hearing scheduled next week to approve interim funding under DIP facility
TROY, Mich., Oct. 14 /PRNewswire-FirstCall/ -- INTERMET Corporation (Pink
Sheets: INMTQ) today announced that its pre-petition lenders have agreed to
permit the company's continued use of cash collateral pending the availability
of its debtor-in-possession (DIP) credit facility, subject to a budget that has
been approved by the pre-petition lenders. Use of cash collateral under this
agreement extends through October 22, 2004. The company believes that access
to its cash collateral should be adequate for the conduct of business prior to
closing of the DIP credit facility.
INTERMET is continuing its negotiations for a DIP facility and has entered into
a commitment with Deutsche Bank Trust Company Americas and The Bank of Nova
Scotia for a twelve-month secured DIP revolving credit facility in the
principal amount of $60 million. The Bankruptcy Court will consider the
company's request for approval of up to $20 million under the DIP facility at a
hearing scheduled for Tuesday, October 19, 2004. In addition to court
approval, the $20 million is subject to an agreed-upon budget, execution of
definitive loan documentation, which the company expects will occur next week,
and other customary conditions, including the placement of a lien on
substantially all of INTERMET's assets having priority over the liens of the
company's pre-petition lenders.
The remaining $40 million of availability under the DIP facility is subject to
various additional conditions and limitations, including approval by the DIP
lenders of a 13-week cash-flow budget and certain financial projections
prepared by INTERMET and final approval by the court. INTERMET will be subject
to customary financial and other covenants under the terms of the DIP facility.
INTERMET's Board of Directors has voted to suspend payments of the quarterly
dividend of $0.01 per share declared in July 2004 and scheduled to be paid
October 1, 2004, to shareholders of record on September 1, 2004.
About INTERMET
With headquarters in Troy, Michigan, INTERMET Corporation is a manufacturer of
powertrain, chassis/suspension and structural components for the automotive
industry. The company has approximately 6,000 employees worldwide. More
information is available on the Internet at http://www.intermet.com/ .
Cautionary Statement
This news release includes forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. The words and phrases
"believes," "should be," "expects" and similar expressions, identify
forward-looking statements. These statements are not guarantees of future
performance but instead involve various risks and uncertainties. INTERMET's
actual results may differ materially from those suggested by its forward-
looking statements due to factors such as: the economic cost, management
distraction and lost business opportunities associated with bankruptcy
proceedings; INTERMET's ability to consummate its anticipated DIP financing;
the high cost of scrap steel and the possibility that scrap steel costs will
remain at high levels or continue to increase, which would have further
negative effects on INTERMET's profitability, cash flow, liquidity and ability
to borrow; fluctuations in the cost of other raw materials, including the cost
of energy, aluminum, zinc, magnesium and alloys, and INTERMET's ability, if
any, to pass those costs on to its customers; pricing practices of INTERMET's
customers, including changes in their payment terms resulting from the
discontinuation of early payment programs and continuing demands for price
concessions as a condition to retaining current business or obtaining new
business, and the negative effect that price concessions have on profit
margins; changes in procurement practices and policies of INTERMET's customers
for automotive components, including the risk of the loss of major customers or
the loss of current or prospective vehicle programs as a result of INTERMET's
financial condition and prospects (or otherwise); possible inability to close
unprofitable plants or to transfer work from one plant to another because of
the related costs or customer requirements; general economic conditions,
including any downturn in the markets in which INTERMET operates; fluctuations
in automobile and light and heavy truck production, which directly affect
demand for INTERMET's products; deterioration in the market share of any of
INTERMET's major customers; fluctuations in foreign currency exchange rates;
work stoppages or other labor disputes that could disrupt production at
INTERMET's facilities or those of its customers; continuing changes in
environmental regulations to which INTERMET is subject, and the costs INTERMET
will incur in meeting more stringent regulations; factors or presently unknown
circumstances that may result in impairment of INTERMET's assets, including
further write-downs of its goodwill; and other risks as detailed from time to
time in INTERMET's periodic SEC reports.
DATASOURCE: INTERMET Corporation
CONTACT: Investor Inquiries: Bytha Mills, or Media Inquiries: Mike
Kelly, both of INTERMET Corporation, +1-248-952-2500
Web site: http://www.intermet.com/