Shopko said that its first-day motions to help facilitate continued operations while the company operates under Chapter 11 protection were approved by the U.S. Bankruptcy Court for the District of Nebraska.
As part of the court’s approval of first day motions, Shopko received authorization on a final basis from the court to provide employee wages, health care coverages and other benefits, including retirement benefits, without interruption, and pay vendors and suppliers for authorized goods and services provided on or after the filing date. Additionally, customer programs, including gift cards and loyalty programs, will be honored and continued.
The court’s approval also affirmed on an interim basis access to $480 million debtor-in-possession financing from certain of its prepetition secured lenders, led by Wells Fargo as administrative agent, to help fund and protect its operations during the Chapter 11 process. This incremental liquidity will ensure that suppliers and other business partners and vendors will be paid in a timely manner for authorized goods and services provided during the Chapter 11 process, in accordance with customary terms, the company said.
Shopko recently filed for Chapter 11 bankruptcy protection and that it would close 38 stores, relocate about 20 optical centers to freestanding locations, and conduct an auction process for its pharmacy business.