Fabric Corp., Fall River, Mass., has begun the process of liquidating its assets and winding down
its operations following a determination by its lenders — Bank of America NA, two other lenders and
GB Merchant Partners LLC — that it is in default of payment of outstanding loans, which currently
total $34.2 million under agreements made in November 2006.
Quaker announced earlier this month that it had not met the requirements for committed
borrowings from its lenders, and that it likely would liquidate its business and sell its assets,
with the expectation that the proceeds would not be enough to provide payment to its stockholders.
The company did not reopen following its annual two-week summer shutdown that began July 2, putting
more than 900 associates out of work; and it has retained RAS Management Advisors Inc., Newport
R.I., to manage the asset liquidation. GB has agreed to provide an overadvance of $2 million solely
for use in winding down the business.
Quaker had net sales in 2006 of $151.7 million, considerably lower than its 2005 sales of
$224.7 million. Increasing imports of upholstery fabrics from China and weakness in the retail
furniture market, among other factors, created difficulties that it ultimately was unable to
July 24, 2007