Accuride lenders extend covenant compliance, interest payment waiver

By Caroline Salls

Pittsburgh, Aug. 14 - Accuride Corp.'s lenders have agreed to extend the company's waiver to Sept. 7, according to a company news release.

The company said the waiver is subject to the ability to extend the period to Sept. 15.

According to the release, the waiver covers Accuride's failure to meet financial covenants included in its credit agreement and any failure to make an interest payment on its 8½% senior subordinated notes due 2015 after a 30-day grace period.

The interest payment waiver is subject to the company obtaining a waiver or forbearance from the noteholders by Sept. 7.

"We're pleased to secure an extension of the waiver under our credit agreement to provide Accuride with additional time to evaluate and negotiate opportunities to refinance and recapitalize its business," Accuride senior vice president and chief financial officer Jim Woodward said in the release.

"The company and its advisors have been working diligently on a comprehensive plan that addresses the balance sheet challenges currently facing the company due to the depressed conditions in the commercial vehicle market."

In exchange for the temporary waiver, Accuride has agreed to provide detailed and regular financial information to a lender steering committee and to comply with other restrictions, including restrictions on incurring additional debt, making investments and selling assets.

In addition, Accuride has agreed to maintain an average liquidity of $32.5 million over a rolling five business-day period and a minimum liquidity of $28 million.

The temporary waiver is subject to early termination events, including the occurrence of other events of default under the credit agreement and payment of interest due Aug. 1 on the company's outstanding notes.

As previously reported, the company did not make the $11.7 million interest payment due Aug. 3 on the notes to maintain compliance with the waiver, and it plans to use the existing 30-day grace period to continue restructuring talks.

Accuride is an Evansville, Ind.-based manufacturer and supplier of commercial vehicle components.

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