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Sirva $150 million DIP loan approved, creditor appeals
By Caroline Salls
Pittsburgh, March 3 - Sirva, Inc.'s $150 million debtor-in-possession facility was approved Friday by the U.S. Bankruptcy Court for the Southern District of New York, and Triple Net Investments IX, LP appealed the ruling on Monday.
JPMorgan Chase Bank, NA is the administrative agent on the DIP facility, and J.P. Morgan Securities, Inc. is the lead arranger and bookrunner.
The DIP facility can be converted into a $215 million senior secured exit facility, with $130 million available for letters of credit.
DIP proceeds will be used to repay the company's pre-bankruptcy senior secured loans and to fund working capital and general corporate needs.
The DIP facility includes an $85 million revolving credit facility, with up to $60 million available for letters of credit, and a $65 million term loan.
The DIP facility will mature on June 30, 2008.
Interest will be either Base rate plus 550 basis points or Libor plus 650 bps, at Sirva's option.
Upon conversion of the DIP facility to an exit facility, Sirva will pay a conversion fee of 25% of the common stock of the reorganized company.
In addition, Sirva will pay an upfront fee equal to 2% of the total DIP commitment, plus 1% of $42.31 million backstopped under an incremental commitment letter. Sirva will also pay a $250,000-per-year agency fee.
As previously reported, the final DIP approval hearing was adjourned Feb. 28 amid haggling between the company and its unsecured creditors over language and a committee fee cap.
Judge James M. Peck told counsel for both parties at the hearing that he did not intend to vacate the interim order.
Peck said that a solid case had been made for the financing and its importance to the successful reorganization of the company.
Sirva, a Westmont, Ill.-based relocation services provider, filed for bankruptcy on Feb. 5. Its Chapter 11 case number is 08-10375.
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