Unused Cash Concern Delays Orchids Paper's Ch. 11 Loan

Law360, Wilmington (May 30, 2019, 9:18 PM EDT) -- Bankrupt Orchids Paper Products Co. postponed final action on an $11 million debtor-in-possession loan Thursday, after a Delaware bankruptcy judge challenged terms that could leave $7 million unused while $14.5 million in postpetition vendor and trade claims pile up awaiting an uncertain outcome.

U.S. Bankruptcy Judge Mary F. Walrath branded as "misleading" some provisions in the DIP agreement with private equity-backed Orchids Investment LLC, prompting the debtor and lender to reschedule a final hearing on the deal for June 13.

Orchids Investment, which is also serving as stalking horse bidder for an upcoming company sale, is an indirect affiliate of Black...

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