J.C. Penney Makes Payment As Market Awaits Chapter 11 Move

As many anticipate a chapter 11 bankruptcy announcement, J.C. Penney made an approximately $17 million interest payment that was due and payable on May 7 regarding the company’s senior secured term loan credit facility.

Under the credit and guaranty agreement governing the term loan facility, J.C. Penney had a grace period of five business days to make the interest payment before such non-payment would constitute an event of default, according to a filing with the United States Securities and Exchange Commission.

The company had entered into such grace period in order to evaluate certain strategic alternatives, it stated.