On January 4, 2013, School Specialty, Inc. and certain of its wholly owned subsidiaries entered into a Forbearance Agreement relating to the Credit Agreement dated as of May 22, 2012. The Asset-Based Forbearance Agreement was entered into in connection with Events of Default occurring under the Asset-Based Credit Agreement as a result of the Minimum Liquidity Test under Section 7(f) of the Asset-Based Credit Agreement being unsatisfied as at the last day of the fiscal month of December 2012... Following the occurrence of such Events of Default, the Term Loan Lenders declared all of the unpaid principal amount of the Term Loans, all interest accrued and unpaid thereon and all other Obligations (including the Early Payment Fee in the amount of approximately $25 million) to be immediately due and payable or otherwise accelerated, or approximately $93.7 million in the aggregate, as of January 4, 2013
Spencer is correct ... this is a new forbearance agreement. This new agreement provides them more flexibility and additional liquidity. The stock should be going up today and not down. This is amazing!
essentially what it says is that there is pressure from one if its lenders now to the tune of 94 million and because they failed to pass the forbearance agreement in december now the lender either is or will ask for that money or start charging them fees...which will hurt their cash-flow. They need to refi the amount with someone else or with that lender... NOW!!! please.