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Trainor Glass Motion to Use Cash Collateral Granted on Interim Basis

Post Time:Mar 27,2012Classify:Company NewsView:203

 

A motion filed by Trainor Glass in its Chapter 11 bankruptcy case asking a federal court for permission to use cash collateral has been granted on an interim basis, pending a final hearing.

 

The order, issued by the U.S. Bankruptcy Court for the Northern District of Illinois, also permits the company to incur postpetition debt on an interim basis and grants adequate protection and security and other relief to the company's pre- and post-petition lender, First Midwest Bank.

 

"Upon the entry of this order, the pre-petition lender's interest in the pre-petition collateral will be deemed to be adequately protected; provided, however, that nothing herein shall prejudice the pre-petition lender's rights to later assert that its interest in the prepetition collateral lacks adequate protection," writes the court.

 

The order also prohibits Trainor Glass from filing any claims or counterclaims against First Midwest. " … the Debtor does not have, and hereby releases, any claims, counterclaims, causes of action, defenses or setoff rights relating to the prepetition documents, the prepetition liens, the prepetition debt or otherwise, against the prepetition lender and its affiliates, subsidiaries, agents, officers, directors, employees, advisors, consultants, predecessors in interest, successors and assigns," continues the order.

 

The court is permitting the company to use cash collateral "solely in accordance with the budget, subject to the permitted variance." "So long as any prepetition debt or post-petition debt remains outstanding, the debtor may not use or seek to use cash collateral other than pursuant to the terms of this order," writes the court, which goes on to outline the procedure by which Trainor may utilize cash collateral via First Midwest.

 

A hearing is scheduled for April 10 for further review of the case. Trainor Glass had motioned for these provisions shortly after the company filed for Chapter 11 bankruptcy on March 9.

 

Source: http://www.usgnn.comAuthor: shangyi

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