US pasta producer American Italian Pasta Company (AIPC) has provided an update on developments regarding its credit facility and its progress in restating its historical financial statements.
AIPC has secured a US$295m senior credit facility with Bank of America serving as administrative agent and a lender under the facility, with other institutional lenders participating in the credit.
An amendment to the credit facility provides, among other things, the extension of certain financial reporting covenants. Under the amended credit facility, AIPC is now required to deliver its fiscal 2005 and fiscal 2006 audited financial statements to the lenders by 31 December, 2007, rather than 31 March, and the company is not subject to any increased interest charges through that date.
“The amendment to our credit facility, reflecting the strength of our business and our solid relationship with our lenders, allows us to remain focused on business execution and the completion of our restatement process,” said CEO Jim Fogarty. “We continue to be pleased with our liquidity as evidenced by our voluntary prepayment of debt and look forward to availing ourselves of a lower interest rate upon completion of our financial statement filings.”
The company also announced that it has used a portion of its excess liquidity to retire $10.0m of debt. With this payment, the company’s gross debt was reduced from $254.3m to $244.3m.
AIPC said it had “substantially completed” its review of historical accounting matters and is finalising its conclusions and preparing its fiscal year 2005 financial statements and restatements of its financial statements for fiscal year 2004 and prior periods. The company said it expects its 2006 Form 10-K will be completed and filed by the end of June 2007.
The New York Stock Exchange suspended trading in the company’s shares prior to the opening of trading on 20 December, 2006 and under NYSE Rule 802.01E, moved forward with delisting procedures. AIPC has now said that it will no longer pursue the appeal of that decision through the process provided under NYSE rules.
Upon completion of its restatement and bringing its delinquent financial statements current, AIPC said it intends to review its trading venue alternatives, which includes considering a listing on the NASDAQ. Currently, AIPC’s shares are quoted on the Pink Sheets, an electronic quotation service for securities traded over-the-counter.
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