UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
report (Date of earliest event reported): June 18, 2010
Orleans
Homebuilders, Inc.
(Exact
Name of Registrant as Specified in Charter)
Delaware
|
1-6830
|
59-0874323
|
||
(State
or Other Jurisdiction
of
Incorporation)
|
(Commission
File
Number)
|
(IRS
Employer
Identification
No.)
|
3333
Street Road, Suite 101, Bensalem, PA
|
19020
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
|
Registrant’s
telephone number, including area code: (215) 245-7500
Not
Applicable
(Former
Name or Former Address, if Changed Since Last Report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see
General Instruction A.2. below):
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
8.01 Other Events
On March 1, 2010, Orleans Homebuilders,
Inc. (the “Company”) and certain of its subsidiaries (excluding its mortgage
brokerage subsidiary, Alambry Funding, Inc., certain joint venture subsidiaries
and certain other subsidiaries) (collectively, the :”Debtors”) filed voluntary
petitions for reorganization relief under the provisions of Chapter 11 of Title
11 of the United State Bankruptcy Code in the United States Bankruptcy Court for
the District of Delaware. The Chapter 11 case have been consolidated
solely on an administrative basis under lead case No. 10-10684 (PJW) (the
“Chapter 11 Cases”).
On June
18, 2010, Orleans Homebuilders, Inc. (the “Company”) received a letter from a
group of its senior lenders (the “Lender Group”) collectively holding (or that
will, once pending trades have settled, hold collectively) in excess of 80% of
the amount of debt outstanding under the Debtors’ Debtor-in-Possession Loan
Agreement (“DIP Loan Agreement”) and under the Company’s Second Amended and
Restated Revolving Credit Loan Agreement, each as amended, expressing their
support for a proposed Short-Term Incentive Plan for certain members of the
Company’s management team (the “Short-Term Incentive Plan”).
Under the
terms of the proposed Short-Term Incentive Plan, certain members of management
and employees the Company believes are critical to the Company’s ability to
maintain operations during the Chapter 11 Cases and to emerge successfully from
bankruptcy would be eligible to receive a specified bonus
payment. Some of the Short-Term Incentive Plan beneficiaries would be
entitled to receive the full amount of the specified bonus payment as of the
effective date (the “Effective Date”) of a Chapter 11 plan of reorganization for
the Debtors (the “Chapter 11 Plan”) if the beneficiary is employed by the
Company on the Effective Date or was terminated without cause prior to the
Effective Date. Certain other beneficiaries would be entitled to
receive 50% of the specified bonus payment upon the Effective Date and the
remainder 180 days after the Effective Date, if the beneficiary remained
employed by the Company on each date or was terminated without cause prior to
either date. The total amount of these bonuses is
approximately $3.4 million and approximately 42 employees would be eligible to
receive the bonuses, including discretionary bonuses to Jeffrey P. Orleans,
Chairman, Chief Executive Officer and President, and Benjamin D. Goldman, Vice
Chairman, receipt of which is subject, among other things,
to the approval of a majority of the revolving lenders under the DIP Loan
Agreement.
The
Company intends to include the proposed Short-Term Incentive Plan in its Chapter
11 Plan the Debtors anticipate filing with the Bankruptcy Court and anticipates
that the Short-Term Incentive Plan will not be effective unless a Chapter 11
Plan is confirmed (but, may be otherwise effected as discussed
below). Any such Chapter 11 Plan will be subject to confirmation in
Bankruptcy Court proceedings and there is no guarantee that the Debtors will be
successful in their attempts to obtain approval of any Chapter 11
Plan.
In their
June 18, 2010 letter, the Lender Group (which includes their successors and
assigns) stated that it will support approval of the Short-Term Incentive Plan
described above in connection with confirmation of a Chapter 11 Plan and will
take such actions as will be reasonably necessary or appropriate to incorporate
the terms of the Short-Term Incentive Plan into the Chapter 11 Plan and to
obtain approval thereof. The Lender Group further stated that if, for
any reason, a Chapter 11 Plan is confirmed and the Short-Term Incentive Plan is
not approved in connection with such a Chapter 11 Plan and the Lender Group
directly or indirectly owns the reorganized Company, the Lender Group will cause
the reorganized Company to pay the amounts as contemplated by the Short-Term
Incentive Plan.
2
Forward
Looking Statements
Certain
information included herein and in other Company statements, reports and SEC
filings is or may be forward-looking within the meaning of the Private
Securities Litigation Reform Act of 1995, including, but not limited to,
statements concerning the anticipated filing of a plan of reorganization and the
timing and contents thereof; potential confirmation of a plan of reorganization;
the anticipated contents of any plan of reorganization; potential payments under
the proposed Short-Term Incentive Plan; potential emergence form Chapter 11 and
the timing thereof; the potential preservation of the Company’s name and
operations; any sale of the Company or its assets; potential
restructurings of the Company’s liabilities; required bankruptcy court
approvals; potential strategic transactions, including refinancing,
reorganizations, recapitalization and sale transactions involving the Company;
the state of new construction; payments to trade creditors, employees, or
customers; anticipated and potential asset sales; anticipated liquidity; and
strategic transactions and alternatives including but not limited to the sale or
restructuring of the Company. Such forward-looking information
involves important risks and uncertainties that could significantly affect
actual results and cause them to differ materially from expectations expressed
herein and in other Company statements, reports and SEC
filings. These risks and uncertainties include the Company’s ability
to operate under the terms of the DIP Loan Agreement; the Company’s ability to
obtain court approval with respect to motions relating to the bankruptcy
filings; the ability of the Company to develop, confirm and consummate one or
more plans of reorganization with respect to the Chapter 11 proceeding; the
ability of the Company to obtain and maintain normal terms with vendors and
service providers and to maintain contracts critical to its operations; the
ability of the Company to continue to attract buyers of its homes; the ability
to continue normal business operations; the potential adverse impact of the
Chapter 11 proceedings; the ability of the Company to attract, motivate and/or
retain key executives and employees; access to liquidity; local, regional and
national economic conditions; the effects of governmental regulation; the
competitive environment in which the Company operates; fluctuations in interest
rates; changes in home prices; the availability of capital; our ability to
engage in a financing or strategic transaction; the availability and cost of
labor and materials; our dependence on certain key employees; and weather
conditions. In addition, the Company does not anticipate that it will
make any distribution with respect to its currently outstanding equity
securities, whether in connection with the bankruptcy proceedings or
otherwise. Additional information concerning factors the
Company believes could cause its actual results to differ materially from
expected results is contained in Item 1A of the Company’s Annual Report on Form
10-K/A for the fiscal year ended June 30, 2008 filed with the SEC and
subsequently filed Quarterly Reports on Form 10-Q, as well as the Current
Reports on Form 8-K and press releases filed with the Securities and Exchange
Commission on August 14, 2009, October 6, 2009, November 5, 2009, December 9,
2009, December 23, 2009, February 1, 2010 February 19, 2010, March 3, 2010,
March 11, 2010, March 22, 2010, April 20, 2010, April 22, 2010, April 27, 2010,
May 25, 2010 and June 11, 2010.
3
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 hereunto
duly authorized.
Dated:
June 25, 2010
Orleans Homebuilders, Inc. | |||
|
By:
|
Lawrence J. Dugan, | |
Name: Lawrence J. Dugan | |||
Title: Vice President and General Counsel |
4