Dan River gets extension on exit financing commitment letter

By Jeff Pines

Washington, Sept. 20 - The U.S. Bankruptcy Court for the Northern District of Georgia approved an amendment that gives Dan River Inc. until Oct. 22 instead of Sept. 30 to get a commitment letter for exit financing.

The order was filed with the court Friday.

The order was approved over the objection of the official committee of unsecured creditors, which argued that the amendment would hurt the company.

Dan River violated a loan covenant by not meeting the minimum requirement for the earnings before interest taxes and amortization standard for the month ended June 30, creating the need for the amendment.

The amendment caps the Danville, Va.-based textile company's revolver at $75 million, down from $110 million, and increases the interest rate on the revolver by 100 basis points to Libor plus 450 basis points.

Deutsche Bank Trust Co. Americas is the agent for the DIP lenders.

As of Aug. 17, Dan River owed its DIP lenders $104.95 million.

Dan River filed for bankruptcy on March 31. Its Chapter 11 case number is 04-10990.

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