True Religion wins interim financing approval; final hearing May 20

By Caroline Salls

Pittsburgh, May 7 – True Religion Apparel, Inc. obtained a second interim order giving it access to a portion of a proposed $88.89 million in debtor-in-possession financing, according to an order filed Wednesday with the U.S. Bankruptcy Court for the District of Delaware.

The final hearing is scheduled for May 20.

The company said the DIP loans will provide needed financing during its Chapter 11 cases in the face of the spread of Covid-19 throughout the United States, along with the resulting, state-imposed limitations and prohibitions on nonessential retail operations.

Crystal Financial LLC is the administrative agent for a $29 million DIP ABL facility, which will mature six months from the company’s bankruptcy filing date.

Delaware Trust Co. will act as administrative agent and collateral agent for a DIP term loan facility, which will include $8.4 million in new-money loans and a roll-up of pre-bankruptcy debt and will mature in six months.

Under the second interim order, True Religion may access $29 million under the ABL facility and $52.04 million from the term facility, a letter-of-credit refinancing and a pre-bankruptcy term refinancing.

Interest on the term facility will accrue at a rate of 18%, payable in-kind. The motion did not specify the interest rate for the ABL facility.

True Religion is a Vernon, Calif.-based jeans and jeans-related sportswear company. The company filed bankruptcy on April 13 under Chapter 11 case number 20-10941.

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