Uno's denies default reports
CFO says pizza chain has 30 days
NEW YORK - Uno's Chicago Grill has the resources to pay a $7.5 million interest payment due tomorrow, but is availing itself of a 30-day grace period, the company's chief financial officer said yesterday after a report raised concerns the chain might default.
Louie Psallidas, chief financial officer of parent company Uno Restaurant Holdings Corp., said the Boston-based chain was holding out on the payment in an effort to recapitalize the business.
"We have a productive active dialogue going on with our bondholders," Psallidas said.
The Wall Street Journal reported yesterday, citing sources it did not identify, that the chain famous for its deep-dish pizza was deferring the payment and was in talks for a waiver or an amendment. The interest payment is on the company's $141 million in senior secured notes.
Psallidas said the original agreement for the notes in 2005 included a clause allowing a 30-day grace period for the payment - a clause he said was standard in such a document.
Uno's wants to restructure its balance sheet, Psallidas said, adding that if a recapitalization can not be hammered out within the grace period, it will make the interest payment. He emphasized that until the 30 days are up, the company is not in default.
Same-store sales for Uno's first quarter fell 2.3 percent, slightly more than the average 1.1 percent decline at midprice, sit-down chains, according to research service Knapp-Track, which measures sales at more than 10,000 restaurants. 