Home Interiors agrees to comprehensive debt restructuring; suspends SEC filing requirement

By Caroline Salls

Pittsburgh, Jan. 12 - Home Interiors & Gifts, Inc. has reached an agreement in principle on the terms of a comprehensive debt restructuring that would reduce its outstanding debt level and provide for near-term operating flexibility under its senior credit facility, according to a company news release.

The agreement is between the company, Highland Capital Management, LP, which controls the majority of Home Interiors' outstanding senior and senior subordinated debt, and Home Interiors' principal shareholders.

Any restructuring remains subject to various closing conditions.

"With the support of our largest creditor and our principal shareholders, I believe this agreement in principle enables us to move to a restructuring that will allow the company to execute on our long-term business plan and support our decorating consultants and employees," chief executive officer Mike Lohner said in the release.

In connection with the agreement in principle, Home Interiors obtained the consent of affiliates of Highland, as the holder of a majority of Home Interiors' outstanding 10 1/8% senior subordinated notes due 2008, to amend the notes' indenture to allow Home Interiors to stop filing some reports with the Securities and Exchange Commission, including forms 10-K, 10-Q and 8-K.

Accordingly, after determining that it had fewer than 300 holders of the notes, Home Interiors filed a form 15 with the SEC, suspending its obligation to continue to file periodic and other reports in an effort to achieve ongoing cost savings.

Home Interiors & Gifts is a Dallas-based integrated manufacturer and distributor of home decorative accessories.

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