Ruby Tuesday, bankers agree to new credit facility terms

MARYVILLE Tenn. Ruby Tuesday Inc. said Thursday it has agreed with its bankers and note holders on new terms surrounding its credit facility, but did not outline the changes.

The casual-dining company said it would need “several weeks” to finalize the new agreements, which were necessary because the operator had expected to break its debt-to-earnings covenant and enter default. Ruby Tuesday’s debt totaled about $590 million on Dec. 4, 2007, and the company reported declining sales and profit throughout last year. Ruby Tuesday previously obtained covenant waivers through April 18, but because the actual ratios fell within allowable limits, the company said, such waivers were unnecessary. The company is not pursuing any further waivers, it said. Ruby Tuesday owns and operates 721 namesake restaurants and an additional 221 locations are operated by franchisees.