Examples of Prepetition ABL Facility in a sentence
Although there are multiple parties that hold a portion of the debt included in the Prepetition ABL Facility and the Prepetition Term Loans, only the administrative agents have been listed for purposes of Schedule D.
The Prepetition ABL Facility provides for a $55 million senior secured revolving credit facility (subject to a borrowing base composed primarily of inventory and credit card receivables) with a maturity date that is the earlier of (a) June 22, 2020 or (b) 45 days prior to the stated maturity date of the Term Loan Facility and any permitted refinancing thereof.The Prepetition ABL Facility provides for LIBOR loans and Prime Rate loans.
Obligations under the Prepetition ABL Facility are secured by an all asset lien, including, without limitation, a first priority lien on the Debtors’ accounts (including receivables), inventory, deposit accounts, security accounts, cash, and cash equivalents, and a second priority lien on certain other property of the grantors, including, without limitation the Debtors’ intellectual property and all equity interests of the Debtors and their subsidiaries (collectively, the “ABL Collateral”).
This began a self-fulling spiral, in which a lower borrowing base handcuffed the Debtors’ ability to borrow under the Prepetition ABL Facility, the inability to borrow in turn handcuffed the Debtors’ ability to buy fresh inventory, and the inability to purchase inventory depressed the borrowing base availability.
Despite the December 2016 cost-cutting initiatives described below, incremental amendments to the Prepetition ABL Facility and the Prepetition Term Loan Facility, and implementation of the Back-to- Basics Strategy, the Debtors faced a liquidity crisis in the summer of 2017 following sustained market conditions and operational losses.