Management & Operations

Blue Bird announces new loan agreement

Posted on January 27, 2006

Blue Bird Corp. announced today that its lenders have agreed to increase the company’s borrowing availability by $52.5 million through a new and expanded loan agreement. The company also said that, in cooperation with its lenders, it is moving forward with a debt-for-equity conversion plan that will dramatically strengthen its balance sheet. The restructuring is being achieved through prepackaged court filing in U.S. Bankruptcy Court, District of Nevada. The company and its lenders expect quick confirmation of the plan, within a matter of days, which provides a full recovery to the company’s general unsecured creditors. The company will continue to operate on a normal basis. “This news marks a positive step forward in Blue Bird’s financial restructuring that will ensure our long-term financial health,” said CEO/President Jeff Bust. “Blue Bird has made unequaled improvements in quality, on-time delivery and set a new standard for customer service in the bus industry. With new financing in place, the benefits of those improvements will become even more apparent. The prepackaged court filing is the most efficient method of completing the restructuring. It preserves all supplier claims and protects our customers and employees.” The company stressed that the financial restructuring process would not interrupt normal business operations, adding that Blue Bird remains committed to meeting its delivery schedules and maintaining the highest standards of quality and service. “We are very grateful for the flexibility and cooperation shown by our senior lenders over the past few months,” Bust said. “Their support is a vote of confidence in our business model, our superior products, our excellent management team and our bright prospects.”

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