Orleans Homebuilders seeks approval of $120 million DIP facility

By Caroline Salls

Pittsburgh, March 2 - Orleans Homebuilders, Inc. requested court approval of a $120 million debtor-in-possession facility, according to a Tuesday filing with the U.S. Bankruptcy Court for the District of Delaware.

Wachovia Bank, NA is the agent.

The facility consists of a $40 million revolving credit facility and an $80 million term loan.

Tranche 1 of the term loan would be a $40 million tranche consisting of a roll-up of each pre-bankruptcy lender's share of outstanding pre-bankruptcy debt. Tranche 2 would be a $40 million tranche consisting of a dollar-for-dollar roll-up of each DIP revolving lender's pre-bankruptcy debt.

The facility will mature on the earliest of 12 months from the bankruptcy filing date, the effective date of a plan of reorganization and conversion of the company's Chapter 11 case.

Interest on the revolver will be Libor plus 850 basis points with a 2% Libor floor, and interest on the term loan will be Libor plus 350 bps with a 2% Libor floor.

Up to $22 million of the facility will be available on an interim basis, including up to $8 million under the revolver and up to $15 million to fund letters of credit.

Orleans Homebuilders, a Bensalem, Pa.-based developer, builder and marketer of single-family homes, townhouses and condominiums, filed for bankruptcy on March 1. The Chapter 11 case number is 10-10684.

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