CHANDLER, Ariz. — Bashas' here expects to formally emerge from bankruptcy on Aug. 28, Michael McGrath, the chain's bankruptcy attorney, told SN on Friday.
That date will be 15 days after the U.S. Bankruptcy Court judge in Phoenix confirmed Bashas' reorganization plan and one day after a 14-day appeals period ends.
"We are humble, grateful and extremely pleased with the outcome," Edward N. Basha 3rd, senior vice president, told employees in a letter last Friday, hours after the U.S. Bankruptcy Court in Phoenix had confirmed its reorganization plan. "It hasn't been an easy year, and we will continue to face challenges. However, we will persevere."
Under the plan, Bashas' said it will pay all creditors within three years. According to McGrath, Bashas' had a net profit of $13.3 million, with $106 million in cash in the bank after paying all its bills, as of July 22. He said Bashas' expects to make a payment of $59 million the day it emerges from Chapter 11 and to continue to repay creditors over the next three years.
Bashas' filed for bankruptcy protection on July 12, 2009, and subsequently closed 29 of its 159 Arizona stores. In his ruling. Judge James M. Marlar said that, "with thousand of creditors, it is critical this full payment plan, over a reasonably short period of time ... be confirmed now. Further delay is not in anyone's best interest."
Marlar's ruling came five days after he heard final oral arguments from attorneys for the chain's equity owners and its unsecured creditors, who jointly endorsed the reorganization plan, and from attorneys for a lenders group that opposed it.