LATAM Airlines Gets OK For $9.8M Breakup Fee On $1.3B DIP

Law360 (July 22, 2020, 10:17 PM EDT) -- A New York bankruptcy judge on Wednesday approved a $9.75 million breakup fee for a prospective LATAM Airlines Group debtor-in-possession lender on a $1.3 billion loan, saying the airline should be allowed to honor the bargain it had struck with the lender.

In a bench ruling issued during a hearing by phone, U.S. Bankruptcy Judge James Garrity Jr. dismissed creditor arguments that the breakup fee was unnecessary for LATAM to secure the financing from Oaktree Capital Management, saying it was a reasonable part of the deal LATAM and Oaktree had struck.

"Oaktree bargained for the upfront fee, and denying it would...

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