Peter Willmott, Fleming's interim president and CEO, said the financing and vendors' support mean "we can deliver on our commitment to provide Fleming's customers with the goods they need, when they need them." The firm is in talks with lenders for a $150-million permanent debtor-in-possession facility to aid a vendor support program, according to the release.
The court is expected to hear motions on the petitions tomorrow. The interim financing is subject to court approval, as is the vendor support program. The release said the financing will provide what is needed "to successfully operate in and exit from Chapter 11." The agreement allows Fleming the right to use cash collateral and tap the interim capital to effect the closing for permanent debtor-in-possession financing.
Initial dipping into the permanent DIP facility is subject to court approvals, due diligence and definitive documentation. The permanent financing will include a junior lien, favoring vendors, against company assets, the release said. Eligibility to participate in the vendor support program is restricted to vendors who "contractually agree to ship goods on normal trade terms" during the Chapter 11 process. Fleming distributes grocery-type package goods to 500,000 US locations and 600 IGA stores.
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