Hostess, loan agents agree to extend cash collateral use to Aug. 31

By Caroline Salls

Pittsburgh, Aug. 3 - Hostess Brands, Inc. has entered into a stipulation with its pre-bankruptcy revolving credit facility agent, debtor-in-possession facility agent and pre-bankruptcy first-lien agent on the company's use of cash collateral, according to a Friday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The stipulation extends the company's cash collateral termination date to Aug. 31 from Aug. 7.

On July 20, Hostess requested court approval to continue to use cash collateral until Nov. 2.

According to that motion, the company's use of the cash, which is comprised of the proceeds of revolving priority collateral, was scheduled to terminate on July 31.

The company's interim cash collateral use was subsequently extended to Aug. 7 as part of a July 26 stipulation.

The final hearing on the cash collateral use is now scheduled for Aug. 28, postponed from Aug. 7.

Also, Hostess must make a $3 million partial payment on the outstanding principal amount of the revolving loans within two days of the stipulation's entry with the court.

Hostess Brands, an Irving, Texas-based operator of regional bakeries, filed for bankruptcy on Jan. 11, 2012. Its Chapter 11 case number is 12-22052.

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