Broadstripe brings new $15 million Highland DIP loan offer to court

By Caroline Salls

Pittsburgh, June 11 - Broadstripe, LLC is seeking court approval of a $15 million debtor-in-possession financing proposal from Highland Credit Strategies Fund, Highland Floating Rate Advantage Fund and Highland Floating Rate Fund, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

After its original DIP financing motion was denied, the company said it accepted competing offers from first-lien lenders Highland and GoldenTree before selecting the Highland proposal.

The Bank of New York Mellon is the agent on the Highland DIP facility.

Interest on the Highland DIP loan will be Prime rate plus 400 basis points.

The facility will mature on Dec. 31, 2009.

In comparison, Broadstripe said GoldenTree offered $25 million in DIP financing, of which only $10 million could be borrowed to fund the payment of post-bankruptcy interest to the first-lien lenders if the court ordered adequate protection payments.

As a result, the company said the credit available to fund its operations was the same under both proposals.

The proposed interest rate on the GoldenTree financing was Prime rate plus 399 bps, but borrowings in excess of $15 million would have accrued interest at Prime rate plus 850 bps.

As previously reported, interest on the original Highland proposal, which was denied by the court in March, was Prime rate plus 900 bps.

A hearing is scheduled for June 30.

Broadstripe, a St. Louis provider of integrated video, broadband and home phone services, filed for bankruptcy on Jan. 2, 2009. Its Chapter 11 case number is 09-10006.

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