Party City units skip interest payment on 15% first-lien notes

By Sarah Lizee

Olympia, Wash., Aug. 21 – Party City Holdco Inc. subsidiaries Anagram Holdings, LLC and Anagram International, Inc. elected to not make the interest payment on their 15% PIK/cash senior secured first-lien notes due 2025, according to an 8-K filed on Friday with the Securities and Exchange Commission.

The issuers, which are not debtors in Party City’s Chapter 11 proceedings, have entered a 30-day grace period to make the interest payment.

They have also entered into a forbearance agreement with both a majority of the holders of their first-lien notes and a majority of the holders of their 10% PIK/cash senior secured second-lien notes due 2026.

The issuers are in discussions with noteholders regarding deleveraging and financing transactions.

Anagram and its subsidiaries plan to continue to operate their business in the ordinary course.

During the forbearance period, the issuers expect to have continued access to their cash and borrowings available under their asset-based lending facility.

Party City is a Woodcliff Lake, N.J.-based supplier of decorated party goods available at more than 800 stores and online. The company filed bankruptcy on Jan. 17, 2023 under Chapter 11 case number 23-90005.

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