Katerra unsecured creditors committee objects to DIP financing

By Sarah Lizee

Olympia, Wash., July 20 – Katerra, Inc.’s official committee of unsecured creditors objected to the company’s motion for final approval of a $35 million debtor-in-possession facility from SB Investment Advisers (UK) Ltd., according to a Monday filing with the U.S. Bankruptcy Court for the Southern District of Texas.

The committee said it objects to entry of the final order because the proposed releases granted to the DIP lender and its affiliates, including the debtors’ shareholders and certain officers and directors, deprive the bankruptcy estates of valuable claims and causes of action for no consideration.

“The debtors’ limited funding needs and pending asset sales render the DIP facility and its proposed releases unnecessary,” the committee added.

Following the interim order, the company has access to $25 million of the facility.

The facility is set to mature 75 days after closing and will bear interest at 10%.

Katerra is a technology-enabled construction company based in Menlo Park, Calif. The company filed bankruptcy on June 6 under Chapter 11 case number 21-31861.

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