Noble House committee prepares DIP objection, but talks continue

By Sarah Lizee

Olympia, Wash., Oct. 3 – Noble House Home Furnishings LLC’s motion seeking final approval of a $12.2 million debtor-in-possession revolving credit facility could draw an objection from the official committee of unsecured creditors, the group said in documents filed Tuesday with the U.S. Bankruptcy Court for the Southern District of Texas.

The committee said that it is in discussions with the debtors and lender Wells Fargo Bank, NA regarding a potential resolution of the group’s concerns.

The group said it does not object in general to the debtor obtaining DIP financing as a means to maximize the value of estate assets through a going-concern sale. As currently proposed, however, the committee said that various rights and forms of relief requested by the debtors in the proposed final DIP order are not in the best interest of the debtors’ estates.

As previously reported, the company has interim access to the facility.

Following a final order, the facility will also include a rollup of prepetition debt.

Interest on the DIP facility is equal to the base rate plus 450 basis points per annum.

Fees include a 0.25% closing fee, a 1.5% sale transaction fee, a collateral management fee of $3,333.33 per month, and an unused facility fee of 0.25% if the average revolver usage is greater than 50% of the maximum revolver amount and 0.375% if usage is less than or equal to 50%.

The facility is set to mature on Oct. 31, 2023.

A final hearing was scheduled for Oct. 4.

The Chatsworth, Calif.-based home furniture company filed bankruptcy on Sept. 11 under Chapter 11 case number 23-90773.

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