By Dow Jones Business News, September 24, 2013, 03:07:00 PM EDT
By Katy Stech
Executives at Pro's Ranch Market have put together a bankruptcy-exit plan for the struggling grocery chain, promising
to repay some of the company's debts using future profits from its 11 locations across the Southwest.
In documents filed with the U.S. Bankruptcy Court in Phoenix, Pro's Ranch Market officials said they will either look
for a new loan or rely on money from Provenzano family members who own the chain, which caters to Hispanic shoppers by
selling imported food products from Mexico and Central America. That money, along with future store profits, would help
pay off the company's suppliers and other unsecured creditors who are owed at least $19 million.
Under the plan, the company would repay its biggest debt--a $48 million loan handled by Bank of America ( BAC )--an
unspecified "discounted" amount within six months of its exit from bankruptcy protection. If the bank votes to reject
the plan, it will get between $8 million and $10 million over a 10-year period.
In court papers filed Monday, Pro's Ranch Market lawyers asked Bankruptcy Judge Sarah Sharer Curley to review a
summary of the plan that would be sent to creditors for a vote. In court papers, they said that the proposal would keep
the 2,300-worker chain's seven grocery stores in Arizona, two stores in Texas and two stores in New Mexico in business.
"The [grocery stores] have a unique brand in a growing market with productive stores and low fixed costs," Pro's Ranch
Market said in court papers. "Additionally, the geographic regions in which the [stores] have a presence are beginning
to experience an economic recovery."
Pro's Ranch Market officials put the chain into bankruptcy in May, blaming the economic slowdown that led to job
losses for construction and other blue collar workers in the Southwest.
In court papers, the company also said its business has suffered because of a "hostile" attitude toward immigrants and
Hispanics in Arizona.
Company officials said that Pro's Ranch Market was "singled out for an immigration audit to which no other competitor
was subjected," according to court papers. The company fired about 300 workers in 2010, when the audit of its I-9 forms
found some employees to be working in the country illegally.
Company executives said they put the company under Chapter 11 protection after Bank of America officials began "
charging substantial fees" that led the chain's cash to further deplete, according to earlier court papers.
The company's stores have "marinated cuts of meat, creamerias with specialty cheeses from throughout Central and South
America, tortillerias that make fresh homemade tortillas throughout each day, and cocinas that provide made-to-order
Hispanic dishes," according to court papers.
The company said it also owns an 80,000-square-foot corporate office and warehouse in California and a 151,000-square-
foot warehouse in Phoenix.
(Dow Jones Daily Bankruptcy Review covers news about distressed companies and those under bankruptcy protection. Go to
Write to Katy Stech at email@example.com
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