The US Bankruptcy Court gave an order to iSun, Inc. to obtain DIP financing on an interim basis on June 6, 2024. As per the order, the debtor has been authorized to obtain a term loan facility in the amount of $2 million out of the aggregate $4 million from Clean Royalties, LLC. The DIP loan would either carry an interest rate of SOFR + 18%, paid-in-kind and accrued monthly, along with an additional 5% p.a. interest in the event of default.

As per the terms of the DIP agreement, the loan carries a commitment fee of 4% p.a., an arrangement fee of 1%, and an exit fee of 3% for the first $2 million in principal amount, 6% for the next $1 million in principal amount, and 9% for any DIP Loans more than the foregoing. The DIP facility would mature either on 90 days following the closing date, or on the effective date of the plan or on the date of consummation of the sale of substantially all assets, or dismissal or conversion of chapter 11 cases whichever is earlier. Adequate protection would be provided to the DIP lenders in the form of super-priority administrative expense claims which is subject to a carve-out of $0.05 million towards unpaid professional fees / administrative expenses and priority lien upon and security interest in the debtor?s collateral.

The proceeds of DIP financing would be used to stabilize the Debtors? business operations, fund the Debtors? working capital needs, pay administrative costs in full, preserve value during the Chapter 11 Cases, and conduct a post-petition sale process for their assets and attempt to identify a bid or bids that yields the highest and best value to the Debtors?

estates. The final hearing as been scheduled for June 28, 2024.