ECOtality secures court approval of interim DIP loan, bid procedures

By Caroline Salls

Pittsburgh, Sept. 20 - Electric Transportation Engineering Corp., which does business as ECOtality North America, received interim access to $1.25 million of debtor-in-possession financing, as well as court approval of the bid procedures for the proposed sale of substantially all of its assets, according to Thursday filings with the U.S. Bankruptcy Court for the District of Arizona.

Despite receiving several preliminary indications of interest from potential asset purchasers, the company said it was not able to negotiate a stalking horse bid agreement before the bankruptcy filing because of its liquidity needs.

Under the bidding procedures, ECOtality could enter a stalking horse agreement by Sept. 30.

If any stalking horse bidder is not ultimately the high bidder for the assets, the company would pay it a 2% break-up fee and reimburse up to $25,000 of its sale-related expenses.

The bid deadline is 8 p.m. ET on Oct. 7, the auction will be held on Oct. 8, and the sale hearing is scheduled for Oct. 9.

If the only bids received are for just some of the assets, the company reserves the right to designate any of those qualified bids as the starting bids. Qualified bidders could then submit initial competing bids equal to the amount of any stalking horse protections plus $250,000. Subsequent bids must be made in minimum increments of $100,000.

The approved bid procedures require the sale to close by Oct. 11.

In addition, ECOtality was granted interim access to $1.25 million in DIP financing from Nissan North America, Inc.

The facility will mature on the earliest of Oct. 28, the closing of an asset sale, the expiration of the interim order if a final order has not been entered and acceleration of the loan.

Interest will be 5%.

The final DIP financing hearing is scheduled for Oct. 3.

ECOtality, a renewable energy company based in San Francisco, filed bankruptcy on Sept. 16. The Chapter 11 case number is 13-16126.

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