MEGA Brands amends loan, waiving debt to EBITDA and fixed-charge coverage ratios

By Sara Rosenberg

New York, March 31 - MEGA Brands Inc. amended its senior secured credit facility, waiving the funded debt to EBITDA and the fixed-charge coverage covenants as of Dec. 31 and until Sept. 30, 2008, according to a news release.

Also, a new financial covenant was added, under which the company will have to maintain a minimum cumulative EBITDA at the end of each of its second, third and fourth financial quarters of its 2008 financial year.

In addition, under the amendment, the lenders agreed to the sale of the company's stationery and activities business and to the release of the liens on the assets sold, provided that the net proceeds from this sale will be used to prepay bank debt.

MEGA Brands is a Montreal-based maker of construction toys, games & puzzles, arts & crafts and stationery.

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