Hayes Lemmerz Granted Access to DIP Financing

Hayes Lemmerz International now has access to $100 million to use to fund its operations as it reorganizes in a pre-packaged bankruptcy reorganization. The financing is available also to the company's foreign subsidiaries, which are not covered by the Chapter 11 filing. The manufacturer of aluminum and steel wheels for cars and light trucks filed a pre-packaged bankruptcy petition in mid May, supported by a number of creditors who staked the company with $100 million of DIP financing. In the same ruling, the bankruptcy court approved the company's motion to set a general bar date and procedures for filing proofs of claim. The date is July 27, 2009. Also, Hayes Lemmerz was authorized to pay prepetition employee obligations, to continue funding employee benefit programs, and to honor workers' compensation obligations. It is cleared to continue paying the prepetition invoices of “essential vendors, certain prepetition shipping, warehousing and import obligations and certain contractors' liens,” according to its statement The bankruptcy court also confirmed a grant of “administrative expense status” to prepetition deliveries of goods within 20 days of the Chapter 11 filing date (May 11, 2009), and issued a final order prohibiting utility companies from discontinuing service to Hayes Lemmerz because of unpaid prepetition invoices. Additionally, the court granted Hayes Lemmerz’ petition to have the U.S. Trustee appoint a retiree committee to participate in the process of modifying U.S. retiree benefits. Hayes Lemmerz filed for bankruptcy in order to reduce corporate debt, and its plan for restructuring will lead to the lenders gaining “substantially all of the equity” in the reorganized company.