The U.S. Bankruptcy Court issued an interim order approving Golfsmith International Holdings’ motion for orders (a) authorizing the payment of a deposit in connection with the Company’s entry into a work fee letter to obtain replacement D.I.P. financing and entry into such work fee letter and to incur reimbursement of obligations thereunder and (b) scheduling a final hearing.
As previously reported, “In order to pursue the Golfsmith Reorganization, the Company must refinance its current debtor in possession financing facility (the ‘DIP’). Part of the DIP will be paid down on or around October 31, 2016, using the proceeds from the sale of Golf Town, whose sale was approved by the Court in the CCAA Proceeding on September 30, 2016. The DIP must be refinanced or paid off by October 31, 2016, and the Company and its advisors have therefore been actively working with several potential financing sources, including PNC Bank, National Association (the ‘Lender’), to find alternative debtor in possession financing (the ‘Replacement DIP Financing’).”
Court-filed documents continue, “By this Motion, pursuant to sections 105(a) and 363(b) of the Bankruptcy Code, the Debtors request: (a) authority to pay the Lender a $250,000 deposit on or around October 17, 2016, following an emergency interim hearing on this Motion, pursuant to the terms of the Work Fee Letter, (b) authority to enter into the Work Fee Letter with the Lender, (c) subject to a final hearing on this Motion, authority to incur and the obligation to pay the remaining fees, expenses, and any other amounts due to the Lender up to a cap of $400,000 if the Replacement DIP Financing does not close, and (d) that a final hearing on the Motion be scheduled for October 31, 2016.”
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