US Special Situations: Empire Today enters new credit facility

Empire Today LLC, also known as Empire Carpet® and Empire Flooring® (“Empire” or “the Company”), the country’s largest shop-at-home, direct-to-consumer flooring company, today announced that it has entered into a new credit facility with lenders holding approximately 82% of its existing term loans and 100% of its existing revolving commitments. The transaction will, among other things, provide significant incremental liquidity to the Company on competitive terms and extend its existing debt maturities. Pursuant to an offer made to the remaining term loan lenders today, each existing term loan lender has the right to subscribe for its pro rata share of the new money financing and to participate in the transaction to extend the maturity.

According to the terms of the new credit facility, the Company’s revolving credit facility maturity will be extended to February 2029 and the maturity for approximately 82% of its term loan will be extended to August 2029. The remaining approximately 18% of the term loan could be extended to August 2029 pursuant to the offer Empire is making to the remaining term loan lenders. Additionally, under the agreement, Empire’s revolving financial covenant has been waived for the next two years and it will have no other financial covenants during this time.

“Today’s transaction represents a critical step forward for Empire, providing us with the liquidity and financial flexibility necessary to continue to navigate the shifting business environment,” said Brian Hutto, CEO of Empire Today. “In addition, we have streamlined our operations and bolstered our management team in recent years. This well positions Empire to capitalize on the expected recovery in the flooring industry and for future growth. We are thankful for the continued partnership with Charlesbank and H.I.G. and look forward to strengthening our financial foundation to best execute our go-forward strategy for the business.”

Ropes & Gray LLP and Greenhill & Co., LLC are serving as external legal and financial advisors to Empire.  Paul Hastings LLP and Lazard are serving as external legal and financial advisors to an ad hoc group of consenting first lien lenders.