Groff Tractor - Chapter 11 DIP Terms

DIP Terms

Borrower(s) / Guarantor(s)

• Groff Tractor Holdings, LLC, Groff Tractor Mid Atlantic, LLC (“GTMA”), and Dealer 2023, LLC (formerly known as Groff Tractor & Equipment, LLC), as Borrowers
• Groff Resources Holdings, LLC, Groff Tractor Mid Atlantic, LLC, and Dealer 2023, LLC as Guarantor

Agent / Lender(s)

• Manufacturers and Traders Trust Company (“M&T Bank”), as Administrative Agent
• Lenders party to the Prepetition Credit Agreement, as Lenders

DIP Commitments

• The order authorizes the continued use of post-petition loans, advances, and financial accommodations through the earlier of February 18, 2026, or the closing of an asset sale.
• The facility includes:
  • $2.7 million in Supplemental DIP Line Advances to fund DIP Period Expenses (operations and professional fee reserves) through the closing of a sale.
  • $7.9 million in cash from net proceeds of a going concern sale to fund certain wind-down costs and professional fees through the closing date of February 17, 2026.

Cash Collateral

• The DIP Lender shall fund DIP Period Expenses through the closing date via Supplemental DIP Line Advances or the permitted use of Cash Collateral.
• The term “Credit” is defined as post-petition proceeds arising from the following, subject to ordinary course of business limitations:
  • Retail financing provided by CNH to GTMA customers (after payment of outstanding floorplan obligations);
  • CNH warranty reimbursements;
  • CNH parts returns; and
  • Credits arising from Productivity Plus Customer Accounts.

Interest Rate

• The Administrative Agent and Participating Floor Plan Lenders shall not accrue additive post-petition interest on their respective loan balances.
• All other sums provided for under the amendment shall accrue interest after demand for payment at the highest rate payable under the Loan Documents.

Fees

• The Borrowers and Guarantors are required to pay the Administrative Agent, on demand, all costs and expenses incurred in connection with the negotiation, preparation, administration, and enforcement of the ratification agreement and related orders.

Maturity

• The Maturity Date is the earliest to occur of:
  • February 18, 2026;
  • The consummation of a sale of all or substantially all assets;
  • The last date the Borrower is authorized to borrow funds under the Final Financing Order; or
  • The occurrence of an Event of Default (unless waived by the Administrative Agent).
• Milestones:
  • January 23, 2026: Deadline for selection of a winning bidder (LB Advisors, LLC deemed acceptable subject to specific financing contingency removals).
  • February 17, 2026: Deadline for the closing of the sale transaction.

Carve Out / Case Expense Contribution

• Case Expense Contribution Amount: Calculated as the actual Supplemental DIP Line Advances plus “Going Concern Closing Costs” actually incurred (capped at budgeted amounts).
• Allocation:
  • The DIP Lender and Participating Floor Plan Lenders shall allocate the Case Expense Contribution Amount on a 50/50 basis.
  • Participating Floor Plan Lenders’ contributions are funded from going concern sale proceeds payable to them; if no such proceeds exist at closing, they must pay their pro rata share to the Debtors.
• CNH Capital Cap: CNH Capital’s contribution is capped at $2.65 million, structured as:
  • $2.0 million for the period through January 9, 2026;
  • Plus $250,000 through January 31, 2026;
  • Plus $400,000 through February 17, 2026.
• Professional Fees: The Administrative Agent and Participating Floor Plan Lenders are responsible for their own professional fees.

Use of Proceeds

• Fund DIP Period Expenses, including operations and professional fee reserves.
• Application of CNH Capital “Credits”:
  • Up to $400,000 used to purchase parts (deemed paid in full and free of CNH liens);
  • Remaining credits available for parts purchases or payable to the GTMA bankruptcy estates.

Credit Bid

• To the extent a Successful Bidder agrees to purchase “Credits” and increases the bid portion payable to Lenders for non-Floor Plan assets, CNH Capital is authorized to apply such Credits to the purchaser's assumption of debts due to CNH Capital.

Securities and Priorities

• The DIP Lender continues to be entitled to all rights, liens, priorities, and protections provided under the Final DIP Order.
• Net sale proceeds from the closing of sale transactions are to be remitted to the Administrative Agent for application to obligations in accordance with the Ratification Agreement.
• Assumption of accrued professional fees, interest, or curtailment by a Successful Bidder shall not reduce proceeds payable to the Administrative Agent.

Adequate Protection

CNH Capital (Floor Plan Lender)

• Payments:
  • Debtors must timely pay all amounts due under the Floorplan Financing Facility for “Floor Plan Payments-Sold Equipment.”
  • Debtors must pay costs for extended warranties or physical damage insurance within 5 days of receiving customer payment.
• Curtailment: CNH Capital agrees not to seek curtailment payments.

Waivers

• Section 506(c): Participating Floor Plan Lenders contributing to the Case Expense Contribution Amount receive a waiver of the Debtors' rights to surcharge their collateral. Non-participating lenders remain subject to surcharge actions.
• Section 364(e): Credit extended under the order is deemed to have been extended in good faith.
• Releases: Upon sale closing, partial repayment of Prepetition Obligations, and the agreed-upon holdback for the Case Expense Contribution, the release granted in favor of the DIP Lender under the Final DIP Order shall be implemented.