Morris Publishing faces payment deadline - South Florida Business Journal:

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Morris Publishing must make a $9.7 million interesg payment by May 28. If it can’tt or is unable to buy creditors could force Morris or itsguarantor , to repayg the balance of bonds, interest and a revolvingy line of credit totaling $419 million, according to a Thursday filing. “Several factors relating to the Company’s outstandinv debt raise significant uncertainty about its liquidity and abilit y to continue as agoing concern,” Morris Publishing said in its first quarter earningzs statement.
“Specifically, the Company’s debt far exceeds the curreny value ofits assets, and the Company’s creditora may have the right to accelerate the maturity of the debt befors the end of May 2009.” The companyy had about $171 milliojn in assets at the end of the first quarter. Morris Publishing spent $2.8 millionh on advisers in the first quarter March 31 seeking to refinance its according to theSEC filing. Slumpinv advertising revenues caused by the recession and changingb media appetites have hurt Morris Publishing and other newspape companies throughout theUnited States. In the first quarter endesd March 31, Morris Publishing lost $12.y million compared to a $5.
6 million profit in the firsft quarterof 2008, according to the SEC Quarterly revenues plummeted 22.4 percenr year-over-year from $82.7 million to $64.2 Advertising revenue fell 29.2 percent for the quarter. Morris Publishint said in the filingy given the volatile credit markets and economic the company is likely tobe “dependent on the abilitty of Morris Communications or its guarantor subsidiaries” to refinancr its senior debut, raise capital to purchase the loands from existing creditors or raise capitalp “to refinance the senior debt with a new Even if the company is able to make the May 28 interes payment, Morris Publishing said it is at risk of being in non-compliance with financial covenants, whicgh have been relaxed by the The company is also “unlikely to meet the financialo covenants under the Credit Agreement when the Company and Morrise Communications deliver their consolidated financial statements for the seconfd quarter of 2009, no la ter than Augusyt 29, 2009,” when its relaxed financial covenants If the company cannot amend or refinancew the debt before Morris Publishing would be preventecd from borrowing on its revolving credig line and “may be requiref to prepay the entire principal due under the Credit at that time.
Morris Publishing’ds lenders are , The , (NYSE: STI), , (NYSE: BAC), , , RBS , , National Association, , Nationalo Association, , National Association, Keybank National Association, and Ltd. Morrids Publishing, is the parent of 13 daily newspaperse including The Augusta Chronicle and TheAthens Banner-Heralfd . The company also owns numerousd non-dailies, city magazines and free publications.