Tom's Foods granted interim use of cash collateral, up to $3 million of DIP financing

By Caroline Salls

Pittsburgh, May 4 - Tom's Foods, Inc. was granted interim approval to use limited cash collateral and to obtain up to $3 million of its debtor-in-possession financing from Fleet Capital Corp. in an order filed Wednesday with the U.S. Bankruptcy Court for the Middle District of Georgia.

In its emergency motion, Tom's said the interim funds were necessary to meet payroll and payroll taxes, purchase raw materials and supplies and pay expenses incurred by the business after its April 6 bankruptcy filing.

Tom's said the funding is necessary for it to continue operating its business.

Tom's is still looking to line up a permanent $22 million debtor-in-possession financing. Fleet Capital holds the promissory note on that interim financing.

Tom's is a Columbus, Ga.-based snack food company. Its Chapter 11 case number is 05-40683.

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