Eddie Bauer Negotiates With Lenders

Eddie Bauer (EBHI) announced results which were terrible of course. Being a retailer business is bad. Basically they are renegotiating their borrowings and cannot file their 10k until the deal is completed. This may even affect their ability to say that they are a going concern. Some glimpses into the process indicate higher interest rates and warrants for the lenders which mean dilution for the investors.

The press release is very silent on operating issues and just focuses on financial compliance with lending conditions. The lenders will be focusing on operating issues as they decide how to prop up this one. If they get warrants on the basis of direct conversations with management which results in more comprehensive information that was not provided to the investing public is this not the ultimate in insider trading.