Mountain Express Oil gets interim approval to use cash collateral

By Sarah Lizee

Olympia, Wash., March 21 – Mountain Express Oil Co. received interim approval to use cash collateral of its prepetition secured lenders, according to an interim order filed Tuesday with the U.S. Bankruptcy Court for the Southern District of Texas.

A further hearing is scheduled for March 27.

Mountain Express’ prepetition capital structure includes a credit agreement with First Horizon Bank as administrative agent. Currently, there is about $176.5 million outstanding under the credit agreement, including $148.3 million under a term loan and $28.2 million under a revolver. These amounts do not include interest or other costs.

The company defaulted on the credit agreement in December.

Mountain Express said it is in advanced discussions with the prepetition secured lenders regarding a possible debtor-in-possession facility, but no agreement has been reached yet.

The company said access to cash collateral is necessary to preserve its assets and effectuate an orderly reorganization process.

The Alpharetta, Ga.-based fuel distributor filed Chapter 11 bankruptcy on March 18 under case number 23-90147.

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