The US Bankruptcy Court gave an order to Delta Apparel, Inc., Salt Life, LLC, M. J. Soffe, LLC, Culver City Clothing Company, and DTG2Go, LLC to obtain DIP financing on an interim basis on July 3, 2024. As per the order, the debtor has been authorized to obtain a asset-based revolving facility in the amount of $7.50 million, out of the total financing of $85 million, from Wells Fargo Bank, National Association, PNC Bank, National Association, and Regions Bank with Wells Fargo Bank, National Association acting as the administrative agent. The individual commitment of Wells Fargo Bank, National Association is $3.90 million, PNC Bank, National Association is $1.80 million, and Regions Bank is $1.80 million.

The DIP loan would carry an interest rate of Base rate plus 6%, along with an additional 2% p.a. interest in the event of default. The DIP facility would mature either on September 27, 2024 or or on the date of consummation of the sale of substantially all assets or the last date borrowers are authorized to borrow funds under the pre-petition credit agreement pursuant to the interim financing order, unless the final financing order has been entered prior to such date, and in such event, then the last date borrowers are authorized to borrow funds under the pre-petition credit agreement pursuant to the final financing order, or unless agent otherwise agrees in writing in its discretion, the occurrence of an event of default, whichever is earlier. Adequate protection would be provided to the DIP lenders in the form of super-priority administrative expense claims which is subject to a carve-out of $0.01 million towards unpaid trustee fees and $0.20 million towards unpaid professional fees / administrative expenses and first priority lien upon and security interest in the debtor?s collateral.

The final hearing is scheduled on July 19, 2024.