Eddie Bauer files for Chapter 11 bankruptcy protection

18 Jun '09

4 min read

The Company has secured a commitment from its existing revolving credit lenders, Bank of America, N.A., GE Capital Corporation and CIT Group/Business Credit, Inc. for so-called Debtor-in-Possession (DIP) financing of $90 million on an interim basis and $100 million based on final court order, which it believes will provide ample liquidity to meet its ongoing obligations during the sale process.

In April 2009, the Company negotiated an amendment with its senior term loan lenders that provided short-term relief on its loan covenants. The Company explored various paths for restructuring its balance sheet, but was ultimately unable to reach an agreement.

The Company has filed customary "First Day" motions seeking Bankruptcy Court approval of various types of relief designed to support its employees, customers and suppliers during the sale process, including motions to allow the Company to continue to pay suppliers under normal terms for goods and services; to pay its employees in the usual manner and to continue without disruption their primary benefits; and to continue the Company's customer programs including its gift card, merchandise return, Friends and other programs.

The Company's legal advisor is Latham & Watkins LLP; its financial advisor is Peter J. Solomon Company; and its restructuring advisor is Alvarez & Marsal. CCMP Capital's legal advisor is Weil, Gotshal & Manges LLP.

Statement of Neil Fiske, President and CEO, Eddie Bauer Holdings Inc:

Eddie Bauer Holdings Inc

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