Tru Grit receives court approval to continue using cash collateral

By Sarah Lizee

Olympia, Wash., Feb. 8 – Tru Grit Fitness LLC received court approval to continue using cash collateral, according to an order filed Wednesday with the U.S. Bankruptcy Court for the District of Nevada.

As previously reported, the debtor and lender EFP Funding Solutions, LLC entered into a third stipulation regarding the cash collateral use.

Tru Grit owes $52.44 million to EFP Funding. That amount doesn’t include interest and other fees.

The stipulation says all of the debtor’s cash constitutes cash collateral, subject to the prepetition liens of EFP, and as such, EFP is entitled to adequate protection of its interest as a condition of the debtor’s use of cash collateral.

As adequate protection to EFP, the debtor granted the lender a post-petition security interest and replacement lien to the same extent and priority as the prepetition liens in the collateral.

EFP is also granted a superpriority claim in the amount of the debtor’s cumulative use of cash collateral to the extent the replacement liens are insufficient to provide enough protection against the diminution, if any, in the value of EFP’s interest in the collateral resulting from the debtor’s use of cash collateral.

This claim will be senior in priority of payment over all administrative expenses.

Tru Grit is a Las Vegas-based professional fitness equipment company. The company filed bankruptcy on Dec. 7 under Chapter 11 case number 22-14320.

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