Company Conducting Sale Process for All or Part
of the Business While Commencing Orderly Wind‑Down of
Operations
Stores to Reopen Starting May 15, 2020
Stage Stores, Inc. (NYSE: SSI) (“Stage” or the “Company”) today
announced that the Company has filed voluntary petitions under
Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for
the Southern District of Texas, Houston Division. The Company will
simultaneously solicit bids for a going concern sale of the
business or any of its assets and initiate an orderly wind-down of
operations. The Company will terminate the wind-down of operations
at certain locations if it receives a viable going-concern bid.
The health and safety of its associates and guests remains Stage
Stores’ top priority as it takes a phased approach to reopening its
stores in the coming weeks to commence the liquidation of its
inventory. The Company currently anticipates that the first phase
of approximately 557 stores will open on May 15, 2020, the second
phase of approximately 67 stores is expected to open on May 28,
2020 and the balance of the chain is expected to open on June 4,
2020. The Company will provide updates as to the location and
timing of stores that are opening on its website, www.gordmans.com,
in due course.
Michael Glazer, President and Chief Executive Officer,
commented, “This is a very difficult announcement and it was a
decision that we reached only after exhausting every possible
alternative. Over the last several months, we had been taking
significant steps to attempt to strengthen our financial position
and find an independent path forward. However, the increasingly
challenging market environment was exacerbated by the COVID-19
pandemic, which required us to temporarily close all of our stores
and furlough the vast majority of our associates. Given these
conditions, we have been unable to obtain necessary financing and
have no choice but to take these actions.”
Mr. Glazer added, “Our associates play a key role in running our
stores and serving guests, and I would like to thank them for their
hard work and dedication. We recognize that the actions we have
taken in response to the market environment and COVID-19 have
affected them both professionally and personally. We deeply
appreciate their efforts going forward as we begin the process of
reopening stores to conduct liquidation sales. We thank our guests
for their business and support, as well as our vendors, who help us
maintain our assortment of brand-name apparel and stylish home
décor. We appreciate the willingness of our landlords and vendors
to work constructively with us to try and avoid this outcome. We
hope that their efforts and the actions we have taken to reposition
the business over the last several months will help attract the
right partner who is interested in our off-price concept.”
Mr. Glazer concluded, “The health and safety of our associates
and guests is of the utmost importance to us. We will continue to
follow health authorities’ recommendations and industry best
practices as we reopen to ensure our associates and guests feel
comfortable shopping in our stores.”
The Company intends to seek approval for a consensual use of
cash collateral to ensure it has the liquidity necessary to support
its operations in Chapter 11.
The Company has also filed a number of customary motions seeking
court authorization to support its operations during the
court-supervised process, including the continued payment of
employee wages, salaries, and health benefits without interruption
for those employees that are working during this time. As part of
the wind‑down, the Company expects to honor existing customer
programs, including gift cards and returns, for the first 30 days
after a store reopens. The Company anticipates that it will stop
accepting any outstanding gift cards or honoring other customer
programs after that time.
Management Updates
Stage Stores today disclosed that Jason Curtis, Executive Vice
President and Chief Financial Officer, is leaving the Company to
pursue a career with another retailer, effective May 22, 2020. Mr.
Glazer will oversee the finance function, and to support him, the
Company retained Rick Stasyszen, who previously served as the
Company’s Senior Vice President, Finance and Controller until
2019.
Additional Information
Court documents and other information about the court-supervised
process are available at a website administered by the Company’s
claims agent, KCC, at www.kccllc.net/StageStores. For additional
information, please call the Company’s Restructuring Hotline at
(888) 647-1732 (US/Canada) or (310) 751-2622 (International) or
submit questions online at www.kccllc.net/stagestores/inquiry.
Kirkland & Ellis LLP is acting as legal advisor to Stage
Stores and PJ SOLOMON is acting as its investment banker. Berkeley
Research Group, LLC is acting as restructuring advisor and A&G
Realty is serving as real estate advisor to the Company. Gordon
Brothers Retail Partners, LLC will manage the Company’s inventory
clearance sales.
About Stage Stores
Stage Stores, Inc. is a leading retailer of trend-right,
name-brand values for apparel, accessories, cosmetics, footwear and
home goods. For more information about Stage Stores, visit the
company’s website at corporate.stage.com.
Caution Concerning Forward-Looking Statements
This release contains “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995.
The words “anticipate,” “estimate,” “expect,” “objective,” “goal,”
“project,” “intend,” “plan,” “believe,” “will,” “should,” “may,”
“target,” “forecast,” “guidance,” “outlook” and similar expressions
generally identify forward-looking statements. Similarly,
descriptions of the Company’s objectives, strategies, plans, goals
or targets are also forward-looking statements. Forward-looking
statements relate to the expectations of management as to future
occurrences and trends, including statements about future operating
results or events and business strategy. Forward-looking statements
are based upon a number of assumptions concerning future conditions
that may ultimately prove to be inaccurate. The Company cautions
that such forward-looking statements contained in this release or
made from time to time by management of the Company, including
those regarding the Bankruptcy Petitions and resulting proceeding
in Bankruptcy Court and delisting from NYSE, involve risks and
uncertainties, and are subject to change based on various important
factors. The following factors, among others, could cause actual
results or outcomes to differ materially from those expressed or
implied in any such forward-looking statements: the Company’s
ability to consummate a plan of reorganization; risks attendant to
the bankruptcy process, including the effects thereof on the
Company’s business and on the interests of various constituents,
the length of time that the Company might be required to operate in
bankruptcy and the continued availability of operating capital
during the pendency of such proceedings; risk associated with third
party motions in the bankruptcy case; risk associated with managing
any potential third party offer for the some or all of the Company;
increased costs to execute the reorganization; the severity,
magnitude and impact of the COVID-19 pandemic, including effects of
the pandemic and the effects of the U.S. government’s and other
businesses’ response to the pandemic, on the Company’s operations
and personnel, and on commercial activity and demand for the
Company’s products, economic conditions (including the impact of
COVID-19); the strength or weakness of the retail industry in
general and of apparel purchases in particular; the Company’s
ability to successfully manage its business initiatives; the
Company’s ability to successfully manage its real estate
relationships; other factors set forth in the Company’s periodic
filings with the U.S. Securities and Exchange Commission, or in
materials incorporated therein by reference. Although it is
believed that the expectations reflected in such forward-looking
statements are reasonable, no assurance can be given that such
expectations will prove to have been correct and persons reading
this release are therefore cautioned not to place undue reliance on
these forward-looking statements which speak only as at the date
hereof. The Company assumes no obligation to update or revise the
information contained in this release (whether as a result of new
information, future events or otherwise), except as required by
applicable law.
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version on businesswire.com: https://www.businesswire.com/news/home/20200510005033/en/
Joele Frank, Wilkinson Brimmer Katcher Leigh Parrish / Aaron
Palash / Viveca Tress 212-355-4449
Stage Stores (NYSE:SSI)
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