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GEO Specialty Chemicals gets emergency consent on post-petition financing
By Jeff Pines
Washington, March 24 - GEO Specialty Chemicals, Inc. obtained emergency consent for initial access to its $15 million Chapter 11 revolver on a superpriority basis with Deutsche Bank Trust Co. Americas.
The facility provides $10 million before the entry of the final order less any carve-out. Carve-out includes any administrative expenses, or professionals' fees up to $250,000. After the final order, the available amount will be up to $15 million minus any carve-out.
Interest will be at prime plus 250 basis points. There is a 50 basis points unused fee.
The March 24 order from the U.S. Bankruptcy Court for the District of New Jersey also authorizes the company to use a portion of its debtor-in-possession financing to pay a portion of its pre-petition obligations.
A hearing on interim access to the facility is scheduled for April 7.
The facility will mature on the earlier of Dec. 31, 2004, the effective date of its reorganization plan or the sale of all of its assets.
In addition, the company will be required to file motion by March 30 that it has selected a chief restructuring advisor that its facility agent and lenders agree with.
Deutsche Bank Securities, Inc. will syndicate the loan, GEO Specialty said.
Earlier this month, the company failed to make the coupon payment on its 10 1/8% senior subordinated notes after within the 30-day grace period. The failure threw it into default on its $120 million of notes and its senior credit facility.
The company filed for bankruptcy on March 18 with the New Jersey bankruptcy court.
GEO Specialty listed assets of $264.1 million as of Sept. 30, 2003, long-term liabilities of $215.4 million and current liabilities of $36.3 million in its most recent 10-Q filing with the Securities and Exchange Commission.
Harrison, N.J.-based GEO Specialty's Chapter 11 case number is 04-19148.
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