Landry's Gets Restraint Vs Lenders
Restaurant operator Landry's Restaurants Inc. on Friday said it obtained a temporary restraining order against its bond holders.
The order, from a judge for the U.S. District Court for the Southern District of Texas, orders the indenture trustee of the company's $400 million 7.5 percent senior notes to immediately withdraw its notice of accelerated repayment.
All holders of the notes are temporarily restrained from taking any action on the basis the senior notes have been accelerated. All holders also are temporarily restrained from communicating to any one that the notes have been accelerated or that the company is not paying its debts as they come due.
A hearing is scheduled for Aug. 16 to determine if the injunction should continue.
The company is represented in the litigation by Buzbee Law Firm, Andrews Kurth LLP, Haynes and Boone LLP and Mills Shirley LLP, among others.
Last week, Landry's said it would try to find financing to replace its current credit agreement and outstanding 7.5 percent senior unsecured notes.
The company has not filed its annual report for the year ended Dec. 31, 2006 because an internal review of Landry's stock option granting practices has not been completed. As a result, Landry's said it was notified by U.S. Bank NA - the trustee of its $400 million unsecured notes - that the unpaid principal and any interest is now due.
Landry's said it will be able to refinance the loan, but it may be on less favorable terms because of "the recent tightening of the credit markets."
Copyright 2007 Associated Press. All rights reserved. This material may not be published broadcast, rewritten, or redistributed.
August 3, 2007
Associated Press 08.03.07, 8:24 AM ET