Louisiana Pellets gets interim access to DIP loan; next hearing Monday

By Caroline Salls

Pittsburgh, March 18 – Louisiana Pellets, Inc. received court approval to access $250,000 of a proposed $2.65 million of debtor-in-possession financing from solid waste disposal facility revenue bond trustee UMB Bank, NA, according to a notice released Friday by the trustee.

A second interim hearing is scheduled for March 21. Subject to the entry of that order, the trustee said it has agreed to fund up to an additional $2,395,500 on an interim basis for essential preservation and maintenance expenses.

The trustee said it may provide further financing under a final order for a longer “restart” period in which Louisiana Pellets’ facility may restart production so that the facility may begin to realize production income.

As previously reported, there will be no interest on the DIP loan. The facility will mature on the earlier of April 18 and occurrence of an event of default.

As a requirement of the DIP facility, the trustee said the company is also appointing a chief restructuring officer. A hearing to approve the appointment of Chip Cummins as CRO is also scheduled for March 21. Cummins’ firm RPA Advisors will provide restructuring services to Louisiana Pellets.

Louisiana Pellets, a Urania, La., wood pellets manufacturer, and German Pellets filed bankruptcy on Feb. 18 in the U.S. Bankruptcy Court for the Western District of Louisiana under Chapter 11 case number 16-80162.

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