Peekay Confirmation Hearing Will Determine Retailer's Destiny

Peekay Confirmation Hearing Will Determine Retailer's Destiny

WILMINGTON, Del. — A bankruptcy judge has approved a Nov. 15 confirmation hearing for Peekay Boutique’s Chapter 11 disclosure and plan, a fast-tracked process that was formed around a $30.7 million sale to senior lenders. 

Peekay, with 46 retail locations as well as its online operations, filed for bankruptcy protection in August, listing more than $72.6 million in debt.

Peekay was forced into bankruptcy after transitioning from a mom-and-pop-owned retailer into a heavily leveraged, investor-owned chain.

According to Albert Altro, Peekay’s recently appointed chief restructuring officer, the Chapter 11 filing for bankruptcy protection capped years of unsuccessful restructuring and sale efforts, including an attempted initial public stock offering and tentative sale agreements.

Under four banners — Lovers, Christals, ConRev and A Touch of Romance — the company operates the bulk of its stores nationwide, particularly in Washington state and Oregon. It also has affiliated ZJ Gifts stores in Texas, Colorado and Oklahoma.

Peekay’s senior lenders agreed to acquire the company as a stalking horse if no other offers arrived. Last week, no other offers were submitted and a planned auction was canceled.

“This was not a loan-to-own scenario by any stretch,” Peekay attorney Adam G. Landis, of Landis Rath & Cobb, told Law360. “They were somewhat of a reluctant buyer. From the company’s perspective, we were very glad to have a floor price with very few barriers to entry.”

Senior lenders, according to a confirmation schedule, would begin voting on the plan immediately with a Nov. 10 deadline, just five days before the confirmation hearing.

Under a settlement announced last month, holders of the Term A senior-most loans agreed to submit a credit bid purchase offer that would cancel $30 million of their current $35.5 million loan claim, according to Law360.

The lenders further agreed to provide an unsecured note up to $200,000, payable over four years, to unsecured creditors, as well as a $100,000, four-year note to the company. The lenders also would assume liability for $400,000 worth of outstanding gift cards.

Related:  

Copyright © 2024 Adnet Media. All Rights Reserved. XBIZ is a trademark of Adnet Media.
Reproduction in whole or in part in any form or medium without express written permission is prohibited.

More News

BasisDx Adds Expedited Results Option for 'Pro13' Home Testing Kit

PASS-certified home testing kit provider BasisDx has added a new option for expedited test results for its Pro13 kit.

Kiiroo, Pineapple Support Launch 'Empower Hour' Series on FeelHubX YouTube Channel

Kiiroo and Pineapple Support have teamed up to launch the “Empower Hour” series on the FeelHubX YouTube channel.

Kansas Law Firm Deploys Religion, Bunk Science While Recruiting Plaintiffs Under AV Law

Kansas-based personal injury law firm Mann Wyatt Tanksley is promoting debunked scientific theories and leveraging religious affiliation against the industry while it seeks potential plaintiffs for lawsuits against adult companies under the state’s age verification law.

UK Tech Secretary Lists Age Verification Among OSA Priorities

Peter Kyle, the U.K.’s Secretary of State for Science, Innovation and Technology, on Wednesday made public a draft version of his priorities for implementing the Online Safety Act (OSA), including age verification.

Orion Debuts 'Suck-O-Mat 3' Masturbator

Orion Wholesale has introduced the third edition of its Suck-O-Mat masturbator.

Biird Debuts 'Ohwii' Glass Dildo

Biird has introduced Ohwii, its new double-ended glass dildo.

Sportsheets Releases New Training Video for 'Edge' Line

Sportsheets has released its latest training video, titled "Edge Product Training," the third in a series hosted by Brand Ambassador Rin Musick.

Exsens Marks Its 10th Anniversary

Intimate wellness and body care brand Exsens is celebrating its 10-year anniversary.

Honey Play Box Debuts 'Trill' Vibrator

Honey Play Box has debuted its new Trill app-controlled vibrator, which joins Melody and Elektra in the company's Kegel toy collection.

10th Circuit Rejects Final FSC Appeal in Utah AV Case

The United States Court of Appeals for the 10th Circuit on Monday rejected a motion by Free Speech Coalition (FSC) requesting that the full court rehear its appeal in Free Speech Coalition v. Anderson, the industry trade association’s challenge to Utah’s age verification law.

Show More