Dave & Buster's seeks amendment to allow for sale-leaseback transaction

By Sara Rosenberg

New York, Aug. 8 - Dave & Buster's Inc. is looking to amend covenants under its $160 million credit facility to allow for the entrance into a sale-leaseback transaction on three fee-owned properties, according to a company news release.

Proceeds from the sale-leaseback would be used to pay down the outstanding balance of the company's term loan, with up to $5 million available for reinvestment. This transaction is expected to close around the October/November timeframe.

In addition, under the amendment, the company would gain the ability to use purchasing cards and treat up to $5 million of these purchasing card obligations as pari passu secured obligations.

Lastly, the amendment would increase the amount of start-up costs to be added back to the company's net income to $7.5 million from $5 million for 2006, and the amount of payments to employees under change in control contracts to be added back to the company's net income would be set at $10 million through fiscal year 2007.

JPMorgan is the administrative agent on the deal.

Dave & Buster's is a Dallas-based operator of upscale restaurant/entertainment complexes.

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