Ritz Camera Centers granted final OK for $85 million DIP loan

By Jennifer Lanning Drey

Portland, Ore., March 26 - Ritz Camera Centers, Inc. obtained final court approval for its $85 million debtor-in-possession facility from Wachovia Bank, NA, according to an attorney for its official committee of unsecured creditors.

The verbal approval came Thursday from the U.S. Bankruptcy Court for the District of Delaware and an order is expected by Friday, the attorney said.

When requesting the approval, Ritz said the DIP financing was necessary to protect its going-concern value and fund its business and operations while the company completes its restructuring.

The DIP facility will mature on the earliest of Feb. 28, 2010, the effective date of the company's plan of reorganization or liquidation and upon completion of a sale of the company's assets.

Interest will be Prime rate plus 375 basis points for Prime rate loans and Eurodollar plus 400 bps for Eurodollar loans.

The company will pay a $1.7 million DIP facility fee, a $1.5 million closing fee and a $5,000-per-month servicing fee.

Ritz, a Beltsville, Md.-based specialty camera and image chain, filed for bankruptcy on Feb. 22. Its Chapter 11 case number is 09-10617.

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