GT Advanced and noteholders object to court changes in loan agreement

By Kali Hays

New York, July 23 – GT Advanced Technologies Inc. and some noteholders backstopping a proposed $95 million debtor-in-possession loan objected on Thursday to changes made by the U.S. Bankruptcy Court for the District of New Hampshire to the loan agreement, according to separate filings.

GT said that it appreciates that the court “does not want its powers to be eroded by a DIP agreement” but that any DIP agreement “by its nature necessarily involves some form of limitation on the court’s powers in certain circumstances.”

Specifically, GT and the noteholders objected to the court’s alteration of language in the original DIP agreement providing for the payment of pre-bankruptcy claims and disposal of DIP collateral, if so approved by the court.

GT said that the court “needs to yield” some of its power in this matter as the company “needs the DIP financing and is not in a position to cause the DIP lenders to yield,” according to an objection.

Meanwhile, the backstop lenders said in their objection that the alterations “fundamentally change the nature of the DIP loan” and that if the court does not agree to revert to the initial agreement “the backstop lenders are no longer willing for fund or participate in the DIP loan.

As previously reported, GT began the solicitation process for noteholder participation in the DIP loan in early July.

The facility is expected to provide for loans in an initial principal amount of $95 million, as well as a facility providing for the issuance of up to $15 million in letters of credit.

GT plans to use the proceeds of the DIP facility to fund working capital requirements, pay costs, fees and expenses incurred in connection with the facility and pay other costs and expenses related to the administration of the company’s and some of its subsidiaries’ Chapter 11 cases.

Merrimack, N.H.-based GT Advanced Technologies is a provider of equipment and services that support the growth of the solar and LED industries. The company filed for bankruptcy on Oct. 6, 2014 under Chapter 11 case number 14-11916.

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