Boyds has received a commitment from D.E. Shaw Laminar Lending, Inc. for up to $8 million in debtor-in-possession financing which, upon bankruptcy court approval, will provide funding for the company’s ongoing operations.
“After considering all available options, we have concluded that reorganization is the best course for Boyds,” said Jan Murley, Chief Executive Officer and Director. “With the burden of our debt leverage and weakness in several of our distribution channels, Boyds’ action will enable the company to realize the strong potential of our premium quality brand and core businesses.”
“At present we are working cooperatively with our lenders and holders of senior subordinated notes to develop a Reorganization Plan, which will address outstanding issues and provide a roadmap for the company’s profitability. We are negotiating the terms of a restructuring plan with our secured lenders and intend to continue these negotiations with other creditor constituencies in the near term. In the meantime, there are no short term liquidity issues, and we are hopeful that once the Plan is filed and accepted, we can exit from Chapter 11 quickly,” added Murley.
Boyds’ operations will not be impacted by the reorganization; it will continue to conduct its business in the usual manner. The company said that it is asking for Bankruptcy Court approval to, among other things, continue payment of pre-petition and post-petition wages, salaries, incentive plans, medical, disability, severance, vacation and other benefits. The company also said it will pay vendors, suppliers and other business partners under normal terms for goods and services they provide during the reorganization process.
“The dedication and hard work of our employees is critical to our success, and for that I thank them. We appreciate the support our vendors and customers have shown us in the past, and continue to ensure that Boyds remains a viable and important partner to them. We will continue to provide the high quality Boyds products for which our loyal and passionate consumers have come to know us. Our management team and I are committed to leading the company through this difficult time and towards a brighter future,” Jan Murley concluded.
Houlihan Lokey Howard & Zukin is the financial advisory firm for The Boyds Collection and Kirkland & Ellis, LLP is the legal counsel.
About The Boyds Collection, Ltd.
The Boyds Collection, Ltd. is a leading designer and manufacturer of unique, whimsical and “Folksy with Attitude(SM)” gifts and collectibles, known for their high quality and affordable pricing. The Company sells its products through a large network of retailers, as well as at Boyds Bear Country™ in Gettysburg, Pennsylvania and Pigeon Forge, Tennessee – “The world’s most humongous teddy bear store.” Founded in 1979, the Company was acquired by Kohlberg Kravis Roberts & Co. (KKR) in 1998. Information about Boyds can be found at www.boydsstuff.com
