Herbst Gaming inks forbearance agreement following credit agreement acceleration

By Caroline Salls

Pittsburgh, Nov. 12 - Herbst Gaming, Inc. has entered into a forbearance and standstill agreement in response to a notice of acceleration received on its second amended and restated credit agreement, according to an 8-K filed with the Securities and Exchange Commission.

The acceleration notice declared the $846.82 million of principal and interest outstanding on the credit agreement immediately due and payable.

Under the forbearance agreement, the lenders have agreed not to exercise their loan payment default-related rights through Dec. 3, unless the company has entered into a restructuring agreement with the lenders by that date, in which case the forbearance period will be extended through Feb. 2.

During the forbearance period, interest will not be calculated at the default rate, and the company will retain its ability to convert the loans into Eurodollar rate loans.

In addition, Herbst will be prohibited from making payments on its subordinated debt during the forbearance period.

Herbst is a Las Vegas-based slot route operator.

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