Five Star draws $10 million under revolver after obtaining waiver

By Wendy Van Sickle

Columbus, Ohio, Nov. 21 – Five Star Quality Care, Inc. drew down $10 million under its $100 million secured revolving credit facility on Tuesday, according to an 8-K filing with the Securities and Exchange Commission.

On Nov. 15, Five Star obtained a waiver from its lenders of a condition requiring the company to represent that, since Dec. 31, 2015, there has been no material adverse change, as defined in the credit agreement governing the revolver.

The lenders requested for the waiver in response to some disclosures included in Five Star’s earnings press release and 10-Q for the fiscal quarter ended Sept. 30.

The company reported in those documents that certain challenges that are negatively impacting its revenues, expenses, cash flows and results from operations are expected to continue at least through 2019 and “have raised substantial doubt about our ability to continue as a going concern,” according to the 8-K.

Based in Newton, Mass., Five Star operates senior living communities.

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