Levitz granted final court OK for $80 million DIP facility

By Caroline Salls

Pittsburgh, Nov. 10 - Levitz Home Furnishings, Inc. obtained final court approval to use up to $80 million of debtor-in-possession financing from GE Capital, according to a Thursday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The DIP consists of a $60 million revolving credit facility, which includes a $5 million sublimit for letters of credit and a $10 million sublimit for swingline loans, and a $20 million senior tranche B term loan. All these tranches are available under the interim approval.

The DIP will terminate at the earliest of nine months, 35 days from the interim order if a final order has not been entered, on the effective date of a plan of reorganization, upon the sale of all of the company's assets or in an event of default.

Interest for the revolver will be Libor plus 325 basis points. Interest on the term loan B will be Libor plus 600 basis points.

Levitz will be required to pay a $225,000 revolver closing fee and a $200,000 tranche B closing fee to GE Capital, as well as a $50,000 administrative agent fee.

The company will pay a $750,000 commitment fee.

Proceeds will be used for the repayment in full of Levitz's pre-bankruptcy debt, working capital and letters of credit, general corporate purposes, administrative costs and payment of fees.

Levitz, a Woodbury, N.Y., furniture retailer, filed for bankruptcy on Tuesday. Its Chapter 11 case number is 05-45189.

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