MARYLAND FARM FRESH GETS FINANCING

ELLIOT ZWIEBACH

BALTIMORE -- Farm Fresh Supermarkets of Maryland here has received financing totaling $1.25 million from its wholesale supplier, Richfood, Mechanicsville, Va., to enable it to remain in business during a Chapter 7 liquidation proceeding. Farm Fresh, a 10-store chain with sales of about $90 million annually, is unrelated to Farm Fresh, Norfolk, Va. A U.S. Bankruptcy Court judge here completed an emergency funding plan last week that will remain in place through Jan. 5 and possibly longer, if creditors have no objections, Joel Sher, attorney for the chain's trustee, told SN last week. The financing consists of a $1 million line-of-credit for groceries and a $250,000 term loan for operations, Sher noted. He said he expects the chain's trustee to seek a buyer for the stores. Farm Fresh has been operating under Chapter 7 since Nov. 17, when three creditors forced the company into involuntary bankruptcy. Those creditors, Sher said, were B. Greene & Co. here, the former wholesaler that owns 49% of the equity in Farm Fresh; BFI (Browning Ferris Industries), a trash pickup business, and Schmidt Baking Co., a bread supplier. Immediately after the filing, the Farm Fresh senior management team resigned -- including the company's founder and chairman, Jack Millman, and sons-in-law William Carter and Steve Cohen -- and the court appointed Terry Musika, of the accounting firm of C.W. Amos Co. here, as trustee to oversee the ongoing operation of the business. Gary Moffett, senior vice president of Farm Fresh before the Chapter 7 filing, is running the operation on a day-to-day basis, observers said. According to Sher, Musika is entrusted with liquidating the company's assets and distributing them to creditors.