SIOUX FALLS, S.D., Oct. 15, 2012 /PRNewswire/ -- LodgeNet
Interactive Corporation (Nasdaq: LNET) today announced that it has
reached a forbearance agreement (the "Forbearance Agreement")
regarding its credit agreement (the "Credit Facility") with lenders
holding a majority of the loans thereunder. This agreement
advances the Company's ongoing process, as announced on
August 21, 2012, of working with its
financial advisors and lenders to address its capital structure and
liquidity needs and implement a long term strategic solution that
best positions the Company for the future.
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In connection with the forbearance agreement, the Company's
lenders have agreed to not exercise their rights, up to and through
December 17, 2012, primarily with
respect to the Company's breach of its leverage covenant under the
Credit Facility. Principal and interest due under the Credit
Facility on September 30, 2012 were
paid.
In light of the forbearance agreement and the Company's need to
manage its liquidity, it has deferred the payment of the preferred
dividend scheduled to be paid on October 15,
2012 on its 10% Series B cumulative perpetual convertible
shares, enhancing its financial flexibility as it works on a
comprehensive solution to strengthen its balance sheet. The
deferred dividend that was scheduled to be paid on October 15, 2012 in the amount of $1.4 million will accrue in accordance with the
terms of the Preferred Stock.
Due to the ongoing nature of the Company's discussions with its
lenders and consideration of strategic alternatives, the Company
will not hold a third quarter 2012 quarterly earnings call.
The Company expects to file its third quarter 2012 results on Form
10-Q with the Securities and Exchange Commission on or before
November 9, 2012.
About LodgeNet
LodgeNet Interactive Corporation is the leading provider of
interactive media and connectivity services to hospitality and
healthcare businesses and the consumers they serve. Recently named
by Advertising Age as one of the Leading 100 US Media Companies,
LodgeNet Interactive serves approximately 1.6 million hotel rooms
worldwide in addition to healthcare facilities throughout
the United States. The Company's
services include: Interactive Television, Broadband and Advertising
Media Solutions along with nationwide technical and professional
support services. LodgeNet Interactive Corporation owns and
operates businesses under the industry leading brands: LodgeNet,
The Hotel Networks and LodgeNet Healthcare. LodgeNet Interactive is
listed on NASDAQ and trades under the symbol LNET. For more
information, please visit www.lodgenet.com.
LodgeNet and the LodgeNet logo are registered trademarks of
LodgeNet Interactive Corporation. All rights reserved. All
other trademarks are the property of their respective owners.
Special Note Regarding Forward-Looking Statement –
Certain statements in this press release constitute
"forward-looking statements." Such forward-looking statements are
subject to risks, uncertainties and other factors that could cause
the actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such
factors include, among others, our ability to comply with terms of
our forbearance agreement and Credit Facility; uncertainties
relating to our ability to reduce room churn and stabilize
revenues; the availability of capital to finance growth; and other
factors detailed, from time to time, in our filings with the
Securities and Exchange Commission. For any of the foregoing
reasons, our anticipated results may not meet our expectations.
These forward-looking statements speak only as of the date of this
press release. We expressly disclaim any obligation or undertaking
to release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in our
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based.
There can be no assurance that we will be able to negotiate an
amendment to the Credit Facility or additional forbearances, that
such amendment or forbearances will be on terms acceptable us, that
we will be able to refinance the Credit Facility, or that we will
be able to complete any strategic alternatives on satisfactory
terms or at all.
SOURCE LodgeNet Interactive Corporation