Toys ‘R’ Us units agree to facility amendments to satisfy indentures

By Caroline Salls

Pittsburgh, Nov. 22 – Toys “R” Us, Inc. said some of its subsidiaries have entered into an amendment to their existing syndicated facility agreement to satisfy notes indenture requirements.

According to an 8-K filed Wednesday with the Securities and Exchange Commission, the amendments satisfy requirements set in the indenture for the 11% senior secured ABL DIP notes issued by TRU Taj LLC and TRU Taj Finance, Inc. and the terms of a foreign guarantors’ agreement related to the issuers’ 12% senior secured notes due 2021.

Toys said the amendment allows specified obligors under the existing facility agreement to provide guarantees and grant liens to secure the obligations of the issuers and guarantors under each of the indentures.

In connection with the amendment, the company said it reduced the lenders’ commitments under the existing facility agreement to £115 million to better align that amount with its current liquidity requirements.

In addition, the amendment modified the maturity date of the existing facility agreement to be substantially the same as the maturity date of the DIP notes.

As a result, the amended maturity date of the facility agreement is the earlier of the date on which the DIP notes mature and Jan. 18, 2019.

As part of the amendment, the applicable margin for loans under the existing facility agreement was increased to 350 basis points, and a financial covenant identical to the one included in the DIP notes indenture was added, requiring the obligors and their subsidiaries to maintain a minimum cumulative consolidated EBITDA not less than a specified percentage of forecasted consolidated EBITDA.

Toys said the amendment also simplifies the borrowers’ minimum liquidity requirements under the facility by including a covenant requiring that they maintain excess availability of at least £10 million, provides that the lenders must forbear from exercising any remedies arising in connection with specified restructuring matters and modifies other negative covenants.

Toys ‘R’ Us is a Wayne, N.J., toy retailer. The company filed for bankruptcy on Sept. 19 in the U.S. Bankruptcy Court for the Eastern District of Virginia under Chapter 11 case number 17-34665.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.