Circuit City Stores, Inc. announced on Monday that it had received approval for its first day motions from the United States Bankruptcy Court for the Eastern District of Virginia in Richmond. The motions filed on the 10th by Circuit City as part of voluntary filing for reorganization relief under Chapter 11 of the United States Bankruptcy Code. Circuit City received court approval for a $1.1 billion debtor-in-possession ("DIP") revolving credit facility to supplement its working capital and provide additional liquidity while it works to reorganize the business.
This financing is being provided by the lenders of Circuit City's current asset-based credit facility and enables the company to pay vendors and other business partners in the ordinary course for goods and services received after the filing. Circuit City received authority to continue to make wage and salary payments and continue various benefits for
associates as well as honor customer programs, such as returns, exchanges and gift cards, and other pre-petition customer obligations.
"We are pleased to have obtained court approval for our first day motions, a critical first step in Circuit City's reorganization process," said James A. Marcum, vice chairman and acting president and chief executive officer of Circuit City Stores, Inc. "These approvals will help position us for a more successful holiday selling season and allow us to operate our business and serve our valued guests without interruption as we work to emerge from Chapter 11 as quickly as possible."
associates as well as honor customer programs, such as returns, exchanges and gift cards, and other pre-petition customer obligations.
"We are pleased to have obtained court approval for our first day motions, a critical first step in Circuit City's reorganization process," said James A. Marcum, vice chairman and acting president and chief executive officer of Circuit City Stores, Inc. "These approvals will help position us for a more successful holiday selling season and allow us to operate our business and serve our valued guests without interruption as we work to emerge from Chapter 11 as quickly as possible."
