Zelenka Farms DIP agent agrees to use of financing beyond termination

By Caroline Salls

Pittsburgh, Sept. 2 – Zelenka Farms entered a stipulation with post-bankruptcy secured lender agent PNC Bank, NA that will allow Zelenka to use limited amounts of debtor-in-possession financing beyond the Aug. 31 DIP facility termination date, according to a Thursday filing with the U.S. Bankruptcy Court for the Northern District of Texas.

Zelenka Farms said it is working to finalize a closing for the sale of substantially all of its assets to LM Farms, LLC.

“In order to protect the DIP collateral from harm, theft, and/or dissipation, the DIP agent is amenable to allow the debtors to use limited proceeds of DIP facility advances from and after the termination date,” the stipulation said.

The company said it must immediately remit to the agent all proceeds of any DIP collateral, including any DIP facility funds, that are not needed to satisfy specified disbursements.

Zelenka Farms is an Irving, Texas-based wholesale plant grower and distributor. The company filed bankruptcy on June 17 under Chapter 11 case number 16-32435.

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