#Harvestsherwood Update: The United States Trustee (UST) has filed an objection to the Harvest Sherwood debtors' motion for final approval of DIP financing which, if approved, would "roll-up" $79.1M in prepetition outstanding debt into priority first lien loans along with only $25.9M of new money.

The UST casts doubt over how the rollup benefits the estate (i.e., whether it's truly necessary to obtain the financing) and whether the DIP lenders should be permitted to use Chapter 5 causes of action (i.e., avoidance actions) as collateral." We expect concessions to be made in the DIP terms that should benefit unsecured creditors as the debtors will seek to avoid a contested hearing on June 3.

#xclaim #claimstrading