Thursday, June 4, 2009

Dayton Superior Will Only Have One DIP For Friday's Hearing

There were a number of filings on the Dayton Superior Docket on June 3rd. Among them were an application by the Official Committee of Unsecured Creditors to retain Conway, Del Genio, Gries & Co., LLC as their financial advisor, the Agenda for Friday's hearing, and GECC's response in relation to the DIP financing matter.

There was news in the GECC response. The response stated that the Ad Hoc Committee of Bondholders has withdrawn their alternative DIP proposal and will be withdrawing their objection to GECC's DIP proposal, as submitted by the Debtor. DK Acquisition Partners and Silver Point Capital also will be withdrawing their objection to the DIP proposal.

Apparently, GECC has agreed to modify the terms of their DIP by:

  • Reducing the interest rate from LIBOR plus 12.00% to LIBOR plus 7.50 %;
  • Reducing the facility fee cap from $3 million to $1,950,000;
  • Eliminating the requirement for a financial advisor; and
  • Extending dates for milestones and for a sale.
The Official Committee of Unsecured Creditors has not withdrawn their objection, so there will be further discussion of the matter at Friday's hearing.

I have not yet seen the revised DIP agreement, but according to the Agenda, the Debtor will be submitting a document entitled "Debtor's Supplemental Memorandum of Law in Support of DIP Financing Motion and Amendment #1 to DIP Credit Agreement." I expect that will be filed today.

Given that there is only one remaining proposal for DIP financing, it will be interesting to see if the Judge requires any changes to the modified agreement - particularly since he issued an Interim Order authorizing the DIP under the original agreement.

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