Term Loan Lenders Extend Orchard Supply’s Agreement Date
Orchard Supply Hardware Stores provided the following update on its efforts to improve its capital structure and expected comparable store sales for the first quarter of fiscal 2013:
“We are looking forward to continuing the momentum we have experienced year-to-date into the second quarter, in which we have historically achieved our highest sales volume.”
Based on productive discussions with the company’s term loan holders, the previous May 1, 2013 date to reach an agreement with respect to a transaction to deleverage, modify or otherwise address the company’s capital structure has been extended to June 30, 2013.
The requirement to meet a mutual agreement by this date is a condition of the previously announced waiver which the Company obtained from its current Term Loan lenders on February 14, 2013, related to compliance with the leverage ratio covenant for the fiscal quarter ended February 2, 2013, and the fiscal quarter ending May 4, 2013. The waiver remains in place, which means that the next applicable measurement date for the leverage covenant is August 3, 2013, subject to the company’s continued compliance with the terms and conditions set forth in the waiver.
Based on the strength of sales trends for March and the first three weeks of April, Orchard anticipates comparable store sales for the first quarter ending May 4, 2013 will increase in the range of 9.0% to 11.0%.
“Orchard continues to make solid progress in our efforts to strengthen our capital structure and improve our operating performance,” said Mark Baker, president and chief executive officer of Orchard. “Our supplier partners have done a great job helping to keep our inventories at appropriate levels even while we have been outperforming our sales plan through the start of the spring season. Thanks to the hard work of the entire Orchard team and the strong ongoing relationships we have with our supplier partners and our lenders, we continue to provide our loyal customers with the in-stock product offerings and high level of service to which they are accustomed.”
Previously on abfjournal.com:
Orchard Supply Readies For May 1 Restructuring Deadline, Monday, April 15, 2013