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NewAge gives details on proposed stalking horse deal, DIP financing
By Sarah Lizee
Olympia, Wash., Aug. 31 – NewAge, Inc. is seeking approval of proposed bid procedures for its assets and debtor-in-possession financing, according to two motions filed with the U.S. Bankruptcy Court for the District of Delaware.
As part of the debtors’ marketing efforts to sell substantially all of their assets, they began negotiations with John Wadsworth, who has worked as an independent sales representative of the New Age enterprise since 1998.
NewAge noted that Wadsworth has never been a director or officer of any debtor and has less than 0.4% of the outstanding shares of debtor NA, Inc.
Wadsworth is a principal of DIP Financing, LLC, which is serving as stalking horse bidder for the company’s assets, as well as lender on a $16 million DIP senior secured term loan agreement.
The DIP facility bears interest at 11.5% and includes a 2% funding fee. The facility is set to mature in 90 days.
Wadsworth has also agreed to purchase the company’s $12 million revolver with East West Bank to help the debtors conserve value as they run the sale process.
The stalking horse agreement, which includes a credit bid against the DIP facility and the revolver, is subject to any higher or better offers as part of the ongoing auction process.
Bid protections include an up to $375,000 expense reimbursement and a 2.5% breakup fee.
Under the proposed bid procedures, bids are due by 4 p.m. ET on Oct. 4, an auction, if needed, will be held on Oct. 5, and a sale hearing will be held on Oct. 7. NewAge is hoping to close the sale by Oct. 11.
The Midvale, Utah-based direct-to-consumer organic and healthy products company filed bankruptcy on Aug. 30 under Chapter 11 case number 22-10819.
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