Franchise Group Files For Chapter 11 Bankruptcy Protection
(RTTNews) - Franchise Group Inc. said that the company and its other affiliates commenced voluntary Chapter 11 proceedings in the U.S. Bankruptcy Court for the District of Delaware. Franchised locations of FRG's brands are not part of the proceedings.
Franchise Group announced that it has entered into a restructuring support agreement with holders of approximately 80% of its first lien debt on a comprehensive solution to strengthen FRG's capital structure and best position its leading brands - Pet Supplies Plus, The Vitamin Shoppe, and Buddy's Home Furnishings - for continued sustainable growth.
The restructuring support agreement contemplates the proposed equitization of the first lien debt into 100% of the equity in the reorganized enterprise, which would substantially reduce the Company's debt, enhance liquidity, and strengthen the enterprise for the benefit of Pet Supplies Plus, The Vitamin Shoppe, and Buddy's Home Furnishings and their stakeholders.
As part of the restructuring plan, the first lien lender group has committed $250 million in debtor-in-possession financing which will provide FRG with ample liquidity to maintain operations across its businesses and fulfill go-forward commitments to employees, customers, vendors, franchise partners, and other stakeholders of FRG, Pet Supplies Plus, The Vitamin Shoppe, and Buddy's Home Furnishings in the ordinary course.
