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Linens 'n Things granted interim access to $700 million DIP facility; final hearing May 27
By Caroline Salls
Pittsburgh, May 5 - Linens Holding Co. received interim court approval of its $700 million debtor-in-possession facility, according to a Friday filing with the U.S. Bankruptcy Court for the District of Delaware.
The final hearing is scheduled for May 27.
General Electric Capital Corp. is the administrative agent and collateral agent.
The $700 million revolving credit facility includes a $400 million sublimit for letters of credit and a C$50 million Canadian subfacility.
The DIP facility will mature on the earliest of one year from closing, 30 days after the interim order if no final order has been entered, the effective date of a plan of reorganization or 30 days following plan confirmation if the effective date has not occurred.
Interest will be either revolver ABR rate/Canadian Prime margin plus 175 basis points or Libor plus 325 bps. The standby letter-of-credit margin will be 325 bps, and the commercial letter-of-credit margin will be 275 bps.
Linens will pay a 2% closing fee, a letter-of-credit fronting fee of 0.125% of the average daily amount of letter-of-credit exposure plus expenses and a $150,000 administrative agent fee.
The company said the DIP financing will ensure healthy merchandise flow as it prepares for the back-to-school and holiday selling seasons.
The DIP facility is also expected to provide adequate working capital to meet ongoing obligations during the company's restructuring.
Linens 'n Things, a Clifton, N.J., home furnishings specialty retailer, filed for bankruptcy on May 2. Its Chapter 11 case number is 08-10832.
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