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Prima Wawona seeks approval of $22 million DIP facility
By Sarah Lizee
Olympia, Wash., Jan. 9 – MVK FarmCo LLC (Prima Wawona) is seeking approval of a $22 million debtor-in-possession multi-draw facility from some of its prepetition secured lenders, according to a motion filed Monday with the U.S. Bankruptcy Court for the District of Delaware.
The DIP facility is structured such that if a Chapter 11 plan is consummated prior to March 31, then all outstanding DIP loans will be rolled up into an exit facility and not paid in cash.
“The DIP lenders are willing to provide DIP financing if the debtors undertake certain measures that are designed to reduce operational and maintenance costs of the debtors’ assets as the prepetition PropCo lenders take possession of the PropCo debtors’ assets and make their own determinations on the prudent route forward for those assets,” the company said in the motion.
Various operational changes contemplated by the DIP budget include the cessation of non-essential maintenance activities and the rejection of unexpired leases and executory contracts that are no longer necessary given the debtors’ Chapter 11 objectives.
Interest on the DIP facility is SOFR plus 1,000 basis points. There is a 0% SOFR floor.
The company is seeking interim access to $6 million of the DIP facility.
A hearing is scheduled for Jan. 17.
Prima Wawona is a Fresno, Calif.-based producer of stone fruit. The company filed bankruptcy on Oct. 13 under Chapter 11 case number 23-11721.
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