Tuesday Morning Corporation Secures $25 Million of Additional Financing to Support Financial and Operational Reorganization
June 04 2020 - 8:30AM
Tuesday Morning Corporation (NASDAQ: TUES) today announced
that the Company has obtained a commitment from BRF Finance Co.,
LLC, an affiliate of B. Riley Financial, Inc. (NASDAQ:RILY) (“B.
Riley”), for $25 million of debtor-in-possession (“DIP”) financing
as required by the Company’s current $100-million DIP agreement
with its existing lender group. With this commitment, the Company
has secured commitments for a total of $125 million to support the
continuity of operations during Chapter 11 proceedings.
As previously announced, due to the immense strain
the COVID-19 pandemic and related store closures put on the
Company, Tuesday Morning is pursuing a financial and operational
reorganization designed to allow the Company to reduce its
outstanding liabilities and strengthen its overall financial
position.
On May 27, 2020, Tuesday Morning filed voluntary
petitions for protection under Chapter 11 of the Bankruptcy Code in
the United States Bankruptcy Court for the Northern District
of Texas – Dallas Division to pursue this reorganization. The
Company expects to emerge from Chapter 11 by early fall 2020.
Steve Becker, Chief Executive Officer, stated, “We
look forward to partnering with B. Riley going forward as we work
hard to reorganize the company so it is as strong as it can
possibly be. This additional capital is an important milestone as
it provides significant liquidity for us to continue operations
throughout the reorganization process. It also further validates
our plan to emerge as a healthier business and as one of the
leading home goods off-price retailers.”
The DIP financing with B. Riley Financial, Inc.
remains subject to a number of conditions, including Bankruptcy
Court approval.
Additional Information Court
filings and other documents related to the court-supervised process
are available at https://dm.epiq11.com/TuesdayMorning, or
by calling the Company’s claims agent, Epiq Corporate
Restructuring LLC, at (855) 917-3492 (or +1 (503) 520-4429 for
international calls) or by sending an email
to TuesdayMorningInfo@epiqglobal.com.
Haynes and Boone, LLP is serving as legal
advisor, Miller Buckfire, a Stifel company, is serving as
financial advisor, and AlixPartners, LLP is serving as
restructuring advisor to Tuesday Morning.
About Tuesday Morning Tuesday
Morning Corporation (NASDAQ: TUES) is one of the original
off-price retailers specializing in name-brand, high-quality
products for the home, including upscale home textiles, home
furnishings, housewares, gourmet food, toys and seasonal décor, at
prices generally below those found in boutique, specialty and
department stores, catalogs and on-line retailers. Based
in Dallas, Texas, the Company opened its first store in
1974 and currently operates 687 stores in 39 states. More
information and a list of store locations may be found on the
Company’s website at www.tuesdaymorning.com.
About B. Riley Financial, Inc. B.
Riley Financial (NASDAQ:RILY) provides collaborative financial
services tailored to fit the capital raising and business advisory
needs of public and private companies and high-net-worth
individuals. B. Riley operates through several wholly owned
subsidiaries which offer complementary end-to-end capabilities
spanning investment banking and institutional brokerage, private
wealth and investment management, corporate advisory,
restructuring, due diligence, forensic accounting and litigation
support, appraisal and valuation, and auction and liquidation
services. Certain registered affiliates of B. Riley originate and
underwrite senior secured loans for asset-rich companies. B. Riley
also makes proprietary investments in companies and assets with
attractive return profiles. BRF Finance Co., LLC is a subsidiary of
B. Riley Financial. For more information about B. Riley and its
affiliated companies, visit www.brileyfin.com.
Cautionary Statement Regarding
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the federal securities laws and
the Private Securities Litigation Reform Act of 1995, which are
based on management’s current expectations, estimates and
projections. Forward looking statements also include
statements regarding the Company’s plans with respect to the
Chapter 11 proceedings, the Company’s plan to continue its
operations while it works to complete the its proposed
reorganization, the Company’s debtor-in-possession financing and
other statements regarding the Company’s proposed reorganization,
strategy, future operations, performance and prospects. These
forward-looking statements are subject to risks and uncertainties
that could cause the Company’s actual results to differ materially
from the expectations expressed in the Company’s forward-looking
statements. These risks, uncertainties and events also
include, but are not limited to, the following: the Company’s
ability to obtain timely approval of the Bankruptcy Court with
respect to motions filed in the Chapter 11 proceedings, including
motions filed with respect to the proposed DIP facility with B.
Riley; pleadings filed that could protract the Chapter 11
proceedings; the Bankruptcy Court’s rulings in the Chapter 11
proceedings, and the outcome of the Chapter 11 proceedings
generally; the Company’s ability to comply with the restrictions
imposed by the terms and conditions of the Company’s DIP facility
with its existing lenders, including the Company’s ability to
maintain certain minimum liquidity requirements, complete the
proposed DIP facility with B. Riley and obtain approval of a plan
of reorganization or sale of all of its assets by agreed upon
deadlines; the length of time that the Company will operate under
Chapter 11 protection and the continued availability of operating
capital during the pendency of the Chapter 11 proceedings; the
Company’s ability to continue to operate its business during the
pendency of the Chapter 11 proceedings; employee attrition and the
Company’s ability to retain senior management and other key
personnel due to the distractions and uncertainties; the
effectiveness of the overall restructuring activities pursuant to
the Chapter 11 proceedings and any additional strategies the
Company may employ to address its liquidity and capital resources;
the actions and decisions of creditors and other third parties that
have an interest in the Chapter 11 proceedings; risks associated
with third parties seeking and obtaining authority to terminate or
shorten the Company’s exclusivity period to propose and confirm one
or more plans of reorganization, for the appointment of a Chapter
11 trustee or to convert the Chapter 11 proceeding to a Chapter 7
proceeding; increased legal and other professional costs necessary
to execute the Company’s restructuring; the Company’s ability to
maintain relationships with suppliers, customers, employees and
other third parties as a result of the Chapter 11 proceedings; the
trading price and volatility of the Company’s common stock and the
effects of the pending delisting from The Nasdaq Stock Market;
litigation and other risks inherent in a bankruptcy process; the
effects and length of the novel coronavirus pandemic; and the other
factors listed in the Company’s filings with the Securities and
Exchange Commission.
Except as may be required by law, the Company
disclaims any obligation to update any forward-looking statements
to reflect events or circumstances after the date on which the
statements were made or to reflect the occurrence of unanticipated
events. Investors are cautioned not to place undue reliance
on any forward-looking statements.
Media Contacts Allison McLarty
Edelman 646-270-6797
Ted McHugh Edelman
212-819-4875TuesdayMorning@edelman.com
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