Bankruptcy court gives interim approval for Harry & David loan

Harry & David got interim approval at a hearing today to borrow up to $155 million while it reorganizes.

The Medford-based company, which sought bankruptcy protection in federal court in Delaware on Monday, worked out an agreement to taken over by noteholders in exchange canceling more than $200 million in debt, but that plan must be approved by the court.

While it reorganizes, the company asked for a $100 million loan from a group of lenders it made agreements with immediately before its bankruptcy filing. It plans to use that loan further along in its reorganization, court documents indicate.

The company also has approval to access to $30 million of a $55 million loan from a group of noteholders and one of the company's private equity owners, and reportedly plans to use that money as working capital.

In addition to agreeing to sign off on the financing, U.S. Bankruptcy Judge Mary Walrath also granted approval for a series of motions designed to ensure that Harry & David is able to continue operating while its reorganization plays out in court.

Share This Story