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Midas’ Bank Group Grants Waiver, Modifies Loan Covenants to Accommodate Payment of Award in European Arbitration
• Interest rates unchanged
ITASCA, Ill.--(BUSINESS WIRE)--March 16, 2011--Midas, Inc.(NYSE: MDS) has been granted a waiver by its bank group for violating certain financial covenants in its existing revolving credit facility, as a result of a recent ruling in the arbitration between the company and its European licensee MESA S.p.A. and Mobivia Groupe S.A.
As a result of the arbitration ruling, Midas must pay an approximate $25.5 million award (including interest) to MESA and Mobivia that has been accrued in the company’s fourth quarter 2010 operating results. The company’s December 2009 revolving credit facility’s covenants required a maximum three-to-one ratio of total debt, including bank debt, letters of credit and the balance of capital leases, to the company’s consolidated adjusted EBITDA. As part of the waiver, the bank group has amended the credit agreement to exclude the $25.5 million expense from the adjusted EBITDA calculations for 2010 and 2011.
The following information was filed by Midas Inc (MDS) on Thursday, March 17, 2011 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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