The US Bankruptcy Court gave an order to JOANN Inc. to obtain DIP financing on an interim basis on March 19, 2024. As per the order, the debtor has been authorized to obtain term loan in a total amount of up to $142 million, shall get $120 million on interim basis in the amount of $142 million with Wilmington Savings Fund Society, FSB. acting as the administrative agent.

The DIP loan shall bear interest at a rate of secured overnight financing Rate (?SOFR?) + 950 bps, to be paid in cash, along with an additional 2% p.a. interest in the event of default. The DIP maturity shall be the earliest of 60 days after the petition date, the effective date acceleration as a result of an event of default that has occurred and is continuing, the date the Court orders a conversion of the Chapter 11 Cases to a chapter 7 liquidation or the dismissal of the Chapter 11 Case of any Debtor, and the closing of any sale of assets pursuant to section 363 of the Bankruptcy Code, which when taken together with all other sales of assets since the Petition Date, constitutes a sale of all or substantially all of the assets of the Debtors, 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 $0.05 million towards unpaid professional fees / administrative expenses and first priority lien upon and security interest in the debtor?s collateral.

The lender is represented by Melissa Barshop and Alex Plaia of Gibson, Dunn & Crutcher LLP as its legal counsel. The final hearing is scheduled for April 17, 2024.