hhgregg granted interim access to financing; final hearing March 31

By Caroline Salls

Pittsburgh, March 8 – hhgregg, Inc. obtained court approval to access its $80 million debtor-in-possession facility on an interim basis, according to an order filed Tuesday with the U.S. Bankruptcy Court for the Southern District of Indiana.

The final hearing is scheduled for March 31.

The financing is underwritten by Wells Fargo Bank, NA and GACP Finance Co., LLC and includes a $50 million senior secured revolving credit facility and a $30 million senior secured “first-in, last-out” term loan facility.

The company said this DIP financing, combined with the acquiring party’s investment and hhgregg’s cash from operations, is expected to provide sufficient liquidity during the Chapter 11 case to support continuing normal business operations and minimize disruption.

Interest on the revolving loans will accrue at the Base rate plus 300 basis points, and the FILO loans will bear interest at Libor plus 1,000 bps.

The DIP credit agreement will mature on the earliest of 12 months after the bankruptcy filing date, the sale of the company’s assets, 35 days after the filing date if a final order has not been entered, the effective date of a plan of reorganization, acceleration of the obligations and the filing of a motion by any debtor seeking dismissal or conversion of the Chapter 11 cases or the appointment of a trustee or examiner.

hhgregg is an Indianapolis-based specialty retailer of consumer electronics and home appliances. The company filed bankruptcy on March 6 under Chapter 11 case number 17-01302.

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