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Wilsons Leather amends loan to reduce revolver size, extend maturities
By Sara Rosenberg
New York, April 27 - Wilsons The Leather Experts Inc. amended its revolver and term B promissory note to reduce the revolver size to $125 million from $180 million and extend the term of the revolver and term B to June 2008.
However, the extension of the maturity dates is not effective until repayment of the company's 11¼% senior notes, according to a company new release.
The reduction in revolver size resulted from a smaller store base and lower inventory requirements.
Furthermore, the revolver was amended to allow for the private placement of newly issued common stock to Peninsula Investment Partners LP, Quaker Capital Partners I LP and Quaker Capital Partners II LP. The company plans to use the proceeds from the new equity to repay its senior notes and for general working capital purposes.
GE Capital, CIT, Wells Fargo and LaSalle are the lead banks on the revolver.
"We are extremely pleased with both of these agreements. The equity placement, led by one of our long-term investors - Peninsula Investment Partners LP - will enable us to operate under a favorable and improved financial structure. Likewise, the credit facility, underwritten by a very supportive bank syndicate, will provide us with the necessary flexibility in working capital to optimize our business as we focus our efforts on returning to profitability," said Joel Waller, chief executive officer, in the release.
"We are excited to have made positive progress with respect to our refinancing and look forward to continuing our efforts to drive our business forward."
Wilsons Leather is a Brooklyn Park, Minn., specialty retailer of leather outerwear, accessories and apparel.
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