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Fred’s Commences Voluntary Chapter 11 Proceedings
September 9, 2019
Source: Yahoo Finance
Fred's, Inc. (NASDAQ:FRED) today announced that the Company has filed for voluntary relief under chapter 11 of the Bankruptcy Code (“Chapter 11”) in the U.S. Bankruptcy Court for the District of Delaware (the “U.S. Bankruptcy Court”). The Company has also filed a motion seeking interim and final approval of the U.S. Bankruptcy Court to enter into a proposed debtor-in-possession (“DIP”) financing agreement (the "Financing Agreement") with certain of the Company’s existing lenders, which would provide for up to $35 million in new funding.
The Company is committed to ensuring an orderly wind-down of its operations, and has commenced liquidation sales at all retail locations, which are expected to close over the next 60 days. The Company expects to continue fulfilling pharmacy prescriptions at most of its pharmacy locations, while it continues to pursue the sale of its pharmacies as part of the court supervised proceedings.
“Despite our team’s best efforts, we were not able to avoid this outcome,” said Joe Anto, Chief Executive Officer at Fred’s. He continued, “I want to thank all of our employees for their hard work and continued support of the Company as we wind-down our operations.”
Fred’s has filed customary motions with the U.S. Bankruptcy Court seeking a variety of “first-day” relief for the filing entities, including authorization to continue paying employee wages and salaries and continue providing employee benefits without interruption, and certain other customary relief.
Additional information regarding Fred’s Chapter 11 filing, including Court filings and information about the claims process are available at https://dm.epiq11.com/Freds. Questions should be directed to the Company's claims agent, Epiq Corporate Restructuring, LLC, at +1 (855) 543-5393 (U.S. / Canada toll-free) or by email to firstname.lastname@example.org.
Kasowitz Benson Torres LLP is serving as the Company's legal counsel, Akin Gump Strauss Hauer & Feld LLP is serving as the Company’s special corporate counsel and Berkley Research Group, LLC is serving as the Company’s restructuring advisor.
About Fred's, Inc.
Since 1947, Fred's, Inc. has been an integral part of the communities it serves throughout the southeastern United States. Fred's mission is to make it easy AND exciting to save money. Its unique discount value store format offers customers a full range of value-priced everyday items, along with terrific deals on closeout merchandise throughout the store. For more information about the Company, visit Fred's website at www.fredsinc.com.
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