Coach America Holdings Receives Approval of Interim DIP Financing
Coach America Holdings Inc. announced that Judge Kevin Gross of the United States Bankruptcy Court for the District of Delaware granted approval on a series of first-day motions filed by the company to help support its customers, employees, suppliers and business partners; to obtain interim financing authority; to maintain existing cash management systems; and to pay vendors and suppliers in the ordinary course of business.
Coach America’s financial and operational stability going forward was enhanced through the granting of the following motions: payment of pre-petition and post-petition employee wages, salaries, business expenses and benefits, including medical, dental and life insurance benefits for current employees; interim approval for $14.8 million of a $30 million debtor-in-possession (DIP) financing for use by the company to continue operations and purchase and pay for goods and services; and financing authority to pay certain pre-petition commitments that are necessary in the course of conducting business. JPMorgan Chase Bank led the lenders in the DIP financing.
The DIP financing package was provided by a steering committee of Coach America’s existing senior lenders. The court has scheduled a final hearing on DIP financing on Friday, January 27.
“The approval of Coach America’s first-day motions by the court is an important initial step in the restructuring process and allows us to move forward with our normal operations, including paying vendors and suppliers in the ordinary course of business,” said George Maney, CEO of Coach America. “We remain focused on serving our customers, and believe that the prompt approval of these ‘first day orders’ is good news for the company, as well as for our customers, employees, suppliers and business partners.”
As previously announced, Coach America Holdings Inc. and its U.S.-based subsidiaries filed to reorganize under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware.
Coach America is a tour and charter bus operator and the second largest motorcoach service provider in the highly fragmented U.S. surface transportation industry.
Previously on abfjournal.com: