Court tentatively OKs Fleming financing
May 1, 2003 12:00 PM
Fleming Companies Inc has received interim approval of its motion for $150 million secured debtor-in-possession financing package from the United States Bankruptcy Court in Wilmington DE. Approval is subject to final documentation and budgetary approval by the firm's DIP lenders.
Until final conditions are met, the Lewisville TX-based supermarket supplier will operate with the $50 million interim bridge financing commitment it received April 3, 2003. The motion also approved creation of a junior trade lien on company assets for use in restoring trade terms from vendors that participate in the vendor support program.
The secured DIP facility will be used to supplement the company's existing cash flow during restructuring. Interim approval is required before a 15-day waiting period for final approval at a hearing set for May 6, 2003.
Under Fleming's proposed trade lien agreement, trade vendors that meet certain requirements — such as agreeing to ship to the company and restoring trade terms — will be eligible to participate in a lien on the company's assets.
Fleming and its operating subsidiaries filed voluntary petitions April 1, 2003, for reorganization under Chapter 11 of the US Bankruptcy Code.
