GAYLORD NAMED IN BONDHOLDER LAWSUIT
GAYLORD NAMED IN BONDHOLDER LAWSUIT DEERFIELD, Ill., June 19 /PRNewswire/ -- Gaylord Container
Corporation (AMEX: GCR) today announced that a lawsuit has been filed alleging that Gaylord's 13-3/4 percent subordinated debentures due 2001 are superior in right of payment to Gaylord's other three issues of subordinated debt (the 16-1/2 percent discount subordinated notes due 1998, 13-1/2 percent subordinated notes due 1996, and 13-1/2 percent subordinated notes due 1998). Named in the suit were Gaylord and First Bank National Association, the trustee for all four debt securities.
As previously announced, this claim of seniority was first asserted by a holder of the 13-3/4 percent subordinated debentures in April 1992. The company, its counsel, and counsel to the Steering Committee of the Unofficial Committee of the holders of the company's four issues of subordinated debt stated at that time that they believed, and they continue to believe, that all
four issues of subordinated debt rank pari passu in right of payment. As announced in April, based on advice of counsel and out of an abundance of caution, Gaylord and the trustee entered into supplemental indentures amending the indentures to resolve any alleged ambiguity as to whether all four issues rank pari passu.
Gaylord Chairman and Chief Executive Officer Marvin A. Pomerantz said, "The allegations in the complaint are totally without merit, and Gaylord intends to vigorously defend itself against them." Gaylord Container Corporation is a major national manufacturer and distributor of corrugated containers, containerboard, unbleached kraft paper, multiwall bags and grocery bags and sacks. -0- 6/19/92 /CONTACT: Kathryn Chieger of Gaylord Container, 708-405-5645/ (GCR) CO: Gaylord Container Corporation ST: Illinois IN: PAP SU:
GK-OS -- NY056 -- 2032 06/19/92 15:56 EDT
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|Date:||Jun 19, 1992|
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