Orleans Homebuilders' DIP facility, plan and sale deadlines amended

By Caroline Salls

Pittsburgh, June 11 - Orleans Homebuilders, Inc. has entered into an amendment to its debtor-in-possession facility, according to an 8-K filed Friday with the Securities and Exchange Commission.

Under the amendment:

• The revolving sublimit was increased to $25 million from $20 million;

• A collateral value ratio financial covenant was eliminated;

• The amount of cash and cash equivalents that Orleans can hold was increased to $7.5 million from $5 million;

• The amount by which actual disbursements made by the company on budgeted items other than permitted vendor payments can exceed the budget on a weekly basis was increased to 25% from 15%, generally subject to a cap increased to $3 million from $2 million;

• A negative covenant restricting Orleans' ability to start new construction on homes was modified to allow the company to begin new construction with the approval of the majority of revolving lenders; and

• The deadlines by which the company must take specified actions in connection with its Chapter 11 case were extended.

Specifically, the company must file its plan of reorganization and disclosure statement by July 13, obtain bankruptcy court approval of the disclosure statement by Aug. 30 and obtain confirmation of the plan by Sept. 28.

In addition, Orleans must file a motion to sell substantially all of its assets by Aug. 12, receive court approval of the bidding procedures by Sept. 1, conduct an auction by Oct. 5, obtain court approval of the sale by Oct. 6 and close the sale by Oct. 18.

Orleans Homebuilders, a Bensalem, Pa.-based developer, builder and marketer of single-family homes, townhouses and condominiums, filed for bankruptcy on March 1 in the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 case number is 10-10684.

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