Armstrong Flooring gets another interim OK to access cash collateral

By Sarah Lizee

Olympia, Wash., May 13 – Armstrong Flooring, Inc. received further interim court approval to use the cash collateral of its prepetition lenders, according to a preliminary order filed Friday with the U.S. Bankruptcy Court for the District of Delaware.

Prepetition asset-based lending facility agent Bank of America, NA and prepetition term loan agent Pathlight Capital LP have security interest in the collateral.

The debtor is authorized to access the cash collateral through May 22.

As previously reported, the company is seeking court approval of $30 million in debtor-in-possession financing with JMB Capital Partners Lending, LLC as administrative agent and collateral agent. The facility matures in two months and bears interest at 10% per annum.

The motion seeking approval of the facility has drawn objections from BofA and Pathlight. The company said it is working to resolve those objections. The agents said they don’t consent to the proposed priming or the adequate protection package proposed in connection with the facility.

“Without the consent of the prepetition secured parties, the priming DIP facility cannot be approved,” BofA had said in its objection.

The Lancaster, Pa.-based flooring designer and manufacturer filed bankruptcy on May 8 under Chapter 11 case number 22-10426.

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