Jacksonville Business Journal: T-U parent gets another extension on debt

Jacksonville Business Journal - April 7, 2009
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Business News - Local News
Tuesday, April 7, 2009, 11:58am EDT | Modified: Tuesday, April 7, 2009, 12:28pm
T-U parent gets another extension on debt
Jacksonville Business Journal

The Florida Times-Union’s parent company received a third extension on nearly $10 million in interest that was due to its lenders more than two months ago.

Augusta-based Morris Publishing Group LLC announced Tuesday that its lenders agreed to another waiver for $9.7 million in interest now due April 24 at 5 p.m., according to the filing with the U.S. Securities and Exchange Commission.

JPMorgan Chase Bank N.A. is the lead lender among 15 others that hold $278.5 million in senior subordinated notes from Morris Publishing that were due Monday. The interest payment was originally due Feb. 1.

The new waiver also deletes a third amendment in its credit agreement that required Morris Publishing, its parent, Morris Communications Co. LLC, or any of its subsidiaries to consummate a transaction that would provide Morris the money to either prepay all of its loans in the credit agreement or find another purchaser of all of the loans by the end of the first quarter but no later than May 30. There is about $140 million in loans under that credit agreement.

This means that the debtors are not forcing Morris to either find a new lender for the full amount, sell more assets or find a way to raise capital in order to pay off the full amount at the end of May.

More than 80 percent, or $226 million, of the holders for Morris’ outstanding senior subordinated notes also agreed to extend the forbearance agreement period so the indenture trustees will not take any action in the event of default such as accelerating the notes during the forbearance period ending April 24.

However, that agreement could end earlier for reasons “including if the lenders under the credit agreement accelerate the maturity of the obligations under the credit agreement, if waiver No. 4 is terminated, upon the occurrence of any other default under the indenture, or if Morris Publishing files for bankruptcy protection or breaches its covenants under the forbearance agreement,” according to the SEC filing.

“We are continuing to address our debt structure,” said Morris Publishing Group’s CEO William Morris IV, in the announcement. “We are hopeful that we will reach an agreement that satisfies all parties.”