Frederick’s of Hollywood to emerge from Chapter 11

The U.S. Bankruptcy Court approved Frederick’s of Hollywood’s reorganization plan. The lingerie cataloger/retailer expects to emerge from Chapter 11 bankruptcy protection early next month.

The key elements of the plan include the conversion of significant debt to equity by the company’s lender group and general unsecured creditors; the provision of additional liquidity by members of the company’s lender group; a new revolving credit facility that will allow the company to devote significant cash to capital expenditures and marketing; the assumption of substantially all of the company’s current store leases; and the anticipated continuation of the company’s senior management team.

According to a company release, the unsecured creditors’ committee, the company’s secured lenders, and substantially all of the company’s landlords supported the reorganization plan.

Frederick’s has been operating under Chapter 11 since July 2000. As part of its ongoing turnaround, it has opened or remodeled more than 20 stores, introduced product lines, and rebuilt its Website.

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