Cottonwood Financial seeks approval of $7 million DIP facility

By Sarah Lizee

Olympia, Wash., Feb. 28 – Cottonwood Financial Ltd. is seeking approval of a $7 million debtor-in-possession facility, according to a motion filed Wednesday with the U.S. Bankruptcy Court for the Northern District of Texas.

The company is seeking interim access to $2 million of the DIP facility, which is with lender Nehimba Holdings, LLC.

The facility is set to mature on July 31 and bear interest at 11% per annum.

The company is also seeking authorization to use cash collateral that prepetition lender Third Coast Bank, SSB has an interest in.

Third Coast has consented to a 30-day budget for the use of cash collateral.

Cottonwood Financial is one of the largest privately held retail consumer finance companies in the United States. The company filed bankruptcy on Feb. 25 under Chapter 11 case number 24-80035.

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