Mountain Express Oil has defaulted on DIP facility, agent says

By Sarah Lizee

Olympia, Wash., Aug. 4 – Mountain Express Oil Co. has defaulted on its debtor-in-possession facility, administrative agent and lender First Horizon Bank said in a notice filed Thursday with the U.S. Bankruptcy Court for the Southern District of Texas.

The DIP financing consists of a $123.65 million senior secured super-priority facility via prepetition secured lenders. The DIP financing includes $37.85 million in new money, in addition to an $85.8 million rollup, which became fully available following the final order. The company was seeking approval to increase the financing by another $9.05 million.

The DIP agent said it has filed a written notice of default to the relevant parties. Under the final DIP order, the DIP agent and lenders can elect to terminate the facility if an event of default occurs, and the DIP loans and other DIP obligations will mature immediately.

First Horizon said that in five business days from when it sent the written notice, it will file a motion for relief from the automatic stay on an emergency basis.

The Alpharetta, Ga.-based fuel distributor filed Chapter 11 bankruptcy on March 18 under case number 23-90147.

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