The U.S. Bankruptcy Court for the Northern District of Texas has granted all first-day motions filed by Corsicana Mattress Company and certain of its affiliates that provides up to $58 million through two debtor-in-possession (DIP) financing facilities to support ongoing operations. Corsicana filed for voluntary Chapter 11 on June 25.
The motions granted also included authorization to cover payroll, benefits and expenses for the company’s full- and part-time employees; continue to use existing bank accounts; maintain the company’s insurance programs; pay outstanding taxes; ensure no disruption from utility providers and continue customer programs. The court’s approval of these motions enables the company to continue to service customers, provide for its employees, and pay vendors and suppliers for services provided and goods received during the Chapter 11 process.
The DIP Facilities provide Corsicana with up to $18 million in term loans from Blue Torch Finance LLC, which is seeking to acquire the Corsicana, Texas-based company through the Chapter 11 process, and up to $40 million in revolving loans from Wingspire Capital LLC.
“We are obviously pleased the court saw fit to grant all our first-day motions to allow us to continue to service our customers and care for our dedicated employees as we go through the Chapter 11 process,” said Eric Rhea, chief executive officer. “The Chapter 11 process will enable Corsicana to emerge as a company re-focused on its core customers, who we will service with greater effectiveness and efficiency in all aspects of our operations.”