LESLIE FAY TELLS COURT IT HAS POST-PETITION FINANCING LOCKED IN PLACE
NEW YORK — The Leslie Fay Cos. has completed post-petition financing for its reorganization plan, its attorney told a bankruptcy court hearing Tuesday.
Confirmation of the Chapter 11 plan had also been set for Tuesday’s hearing, but now confirmation is not expected until after the next hearing, set for Friday.
The court has scheduled testimony for Friday’s hearing from Leslie Fay’s general counsel and its chief financial officer as well as from Raymond J. Terwilliger, a former vice president of human resources who claims he was wrongfully terminated from his position because of age discrimination.
Alan B. Miller, of Weil, Gotshal & Manges, counsel to Leslie Fay, said Leslie Fay will not be able to complete the confirmation of the case on Feb. 28 because of the scheduled testimony and the need to distribute some documents.
Tuesday’s action was the fourth postponement since confirmation was originally set for Jan. 14.
Leslie Fay entered Chapter 11 proceedings in April 1993. As reported, the reorganization plan contemplates the breakup of Leslie Fay into two separate entities, its Sassco business and a reorganized Leslie Fay.
First National Bank of Boston has agreed to provide Sassco with three-year secured financing for $100 million, with a sublimit on letters of credit of $50 million. CIT Group agreed to provide reorganized Leslie Fay with a two-year $30 million secured financing, with a sublimit of $15.5 million in letters of credit.
First National Bank of Boston will receive a $1.5 million commitment fee, a $500,000 structuring fee and $150,000 in working fees, while CIT will get $150,000 in fees and expenses and $250,000 in a facility fee.
In other action, Judge Tina Brozman estimated that claims of three out of five former Leslie Fay employees charging the company with age discrimination were worth zero, the claim of Terwilliger, who nevertheless is to testify Friday.