Bakers Footwear granted OK to pay exit commitment fees and expenses

By Caroline Salls

Pittsburgh, Nov. 13 - Bakers Footwear Group, Inc. received court approval to pay fees and expenses related to an $8.5 million two-year senior secured exit financing commitment from Salus Capital Partners, LLC, according to a Friday filing with the U.S. Bankruptcy Court for the Eastern District of Missouri.

Specifically, Bakers obtained court approval to pay a $150,000 commitment fee, establish a $50,000 due diligence deposit and reimburse Salus' reasonable out-of-pocket expenses tied to the financing commitment.

The company said in the motion that the commitment letter is a fundamental component of its restructuring.

The financing would be used to satisfy plan of reorganization effective date obligations and address Bakers' working capital needs after the effective date, the motion said.

Interest on the revolving credit facility portion of the facility will be Prime rate plus 450 basis points. Interest on the term loan portion will be 13%.

Without the commitment from Salus, the company said it would most likely not have been able to reach a plan support agreement or other term sheet to satisfy a covenant in its debtor-in-possession facility with Crystal Financial LLC.

If the support agreement had not been reached and the covenant had not been satisfied, Bakers said it would have been required to launch liquidation sales at all of its stores.

Bakers, a St. Louis-based footwear retailer, filed for bankruptcy on Oct. 3. The Chapter 11 case number is 12-49658.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.