F&H Acquisition wins interim access to $3.5 million of DIP facility

By Jim Witters

Wilmington, Del., Dec. 17 - F&H Acquisition Corp. received interim access to $3.5 million of its debtor-in-possession financing facility during a Dec. 17 hearing in the U.S Bankruptcy Court for the District of Delaware.

Debtors' attorney Adam H. Friedman said the financing will be used to continue operations at the 101 company-owned restaurants and 12 franchises until a sale process can be completed.

The debtors employ about 5,500 part-time and 500 full-time workers, he said.

The debtors also plan to continue a remodeling program that has resulted in "significant increases in revenue" at the 10 locations where it has been completed, Friedman told the court.

DIP terms

As previously reported, the company obtained a commitment for $9.6 million in debtor-in-possession financing from General Electric Capital Corp., its pre-bankruptcy first-lien secured lenders.

GE is the administrative agent.

The facility will mature on the earliest of March 31, the effective date of a plan of reorganization, the closing of a sale of substantially all company assets or equity interests and the date all obligations are paid in full.

Friedman said the facility includes a $9.6 million revolver and about $2.27 million in letters of credit.

Interest on the DIP revolving credit facility will be either Libor plus 900 basis points or Base rate plus 800 bps.

Completion of the asset sale is required under the DIP financing agreement.

The final DIP will rollup GE's first-lien debt, Friedman said.

A hearing for final DIP approval and bid procedures for the sale of substantially all of the debtors' assets is scheduled for noon ET on Jan.7

F&H Acquisition, a Wichita, Kan.-based owner and operator of Fox and Hound restaurants, Champps and Bailey's restaurants, filed for bankruptcy on Dec. 16. The Chapter 11 case number is 13-13220.

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