Orleans Homebuilders defaults on $350M loan, saying it can’t repay, was unable to modify terms

Orleans Homebuilders defaults on $350M loan

BENSALEM, Pa. — Orleans Homebuilders Inc. said Friday that it defaulted on a $350 million loan since it doesn’t have sufficient funds to repay the amount owed to its creditor and failed to renegotiate the terms of the loan.

The homebuilder said that its second amended and restated revolving credit loan, which it defaulted on, began in Sept. 2008 and matured on Feb. 12. The company had been working with its lenders to lengthen the term of the loan, but said it could not get the proper approval by Dec. 3 or agree with lenders to any changes to the loan agreement.

Orleans Homebuilders said that it is looking at its options for getting funding, including restructuring in court — which could refer to the possibility of filing for bankruptcy protection — or out of court, or a sale of the company.