Wabash says it defaulted on loans because of failure to file 10-K; exploring options

By Susanna Moon

Chicago, March 31 - Wabash National Corp. said an event of default will be deemed to occur under its revolving credit facility because it failed to file by Tuesday its annual report on Form 10-K for the fiscal year ended Dec. 31. The company also said it is exploring options to maximize shareholder value.

The default will permit lenders to increase the interest on the outstanding principal by 2%, to cause an acceleration of the maturity of borrowing, to restrict advances and to terminate the revolving credit facility, according to the company's press release.

The company said it is negotiating a forbearance agreement with lenders to address the consequences of the default and to provide additional liquidity while the company continues discussions to amend the facility and to waive any events of default.

Wabash said there can be no assurance that it could secure a forbearance agreement or obtain an amendment or waiver.

If a satisfactory amendment cannot be reached, there is substantial doubt about the company's ability to continue as a going concern, Wabash said. The company's independent public accountants on the 2008 financial statements are expected to contain an explanatory paragraph to that effect.

The company noted that it was in compliance with its financial covenants under its revolving credit facility at Dec. 31.

On March 16, the company noted that it would be filing its 10-K late because it was continuing to assess its financial position and liquidity requirements in light of recent and ongoing economic conditions that have hurt the company's operating results and caused instability in the capital markets.

As part of the process, the company said it has been negotiating amendments to its second amended and restated loan and security agreement.

"Our priority continues to be working diligently with our lenders to renegotiate our revolving credit facility and improving our liquidity position. However, as stewards of the company we recognize our responsibility to act prudently, and thus, we are exploring all of our options to maximize shareholder value," Dick Giromini, president and chief executive officer, said in the release.

Wabash is a Lafayette, Ind., semi trailer manufacturer.

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