Sedgebrook, Ill., receives notices of potential default on revenue bonds

By Caroline Salls

Pittsburgh, Aug. 27 - Sedgebrook, Inc. in Illinois has received a notice of potential default on its $137.15 million of Illinois Finance Authority revenue bonds in connection with its failure to make a $76,250 installment payment and a $480,381 installment payment, both due Aug. 15, according to a notice released Thursday.

Sedgebrook has 30 days to make the payment before an event of default occurs.

In addition, more than $1.6 million in mechanics lien claims have been filed against the company, which could also trigger an event of default if not discharged within 30 days.

The company is already in default on a letter-of-credit agreement that supports its series B revenue bonds for failure to provide audited financial information.

According to the notice, Sedgebrook reported in July that there is substantial doubt about the company's ability to continue as a going concern.

As a result, the company has retained Healthcare Management Partners LLC to provide chief restructuring officer services, and Michael Morgan has been hired as Sedgebrook's CRO to help the company explore its restructuring alternatives.

The company said it plans to seek a default forbearance from the bond trustee as part of its restructuring efforts.

Sedgebrook is a Lincolnshire, Ill., company serving the real estate and property management industry, specializing in retirement communities.

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