francesca’s® Receives Court Approval of First Day Motions to Support Ongoing Operations

Rhea-AI Summary

Francesca's Holdings Corporation (FRAN) announced its voluntary reorganization under Chapter 11, with interim court approval for $15 million of a $25 million DIP financing facility. These measures allow the company to maintain operations while seeking interested buyers for its assets. A final hearing is set for January 4, 2021, to discuss the approval of bidding procedures for the sale. CEO Andrew Clarke emphasized that this process is aimed at stabilizing the company and enhancing its competitive stance in retail.

Positive

• Obtained interim approval for $15 million of DIP financing to support operations.
• Able to continue normal business operations during restructuring.
• Plans to enhance stability and competitiveness post-reorganization.

Negative

• Filed for voluntary Chapter 11 bankruptcy, indicating financial distress.

francesca’s^® Boutiques and E-commerce Continue to Provide Customers a Unique, Fun and Personalized Shopping Experience

Obtains Interim Approval to Access $15 Million of DIP Financing to Facilitate Sale Process While Continuing to Serve Customers in the Ordinary Course

HOUSTON, Dec. 09, 2020 (GLOBE NEWSWIRE) -- Francesca’s Holdings Corporation (Nasdaq: FRAN) today announced that all “First Day” motions presented to the U.S. Bankruptcy Court for the District of Delaware (the “Court”) on December 8, 2020, which were filed in connection with the commencement of the Company's voluntary reorganization cases, were approved on either an interim or final basis by the Court.

The approved First Day motions permit the Company to, among other things, continue use of its existing cash management system and customer programs, pay certain prepetition obligations of the Debtors’ employees, taxing authorities, critical vendors, and lienholders, and access $15 million of its $25 million debtor-in-possession financing facility. A final hearing on the First Day motions as well as the hearing to consider approval of the Company’s bidding procedures that will allow interested parties to submit binding offers to acquire substantially all of the Company’s assets is scheduled for January 4, 2021.

"With the Court's approval of our First Day motions, francesca’s is able to continue operations in the ordinary course and pursue a sales process to a new investor," said Andrew Clarke, Chief Executive Officer of francesca’s^®. "We intend to emerge from this process as a stable and competitive Company allowing us continue to focus on our omni-channel strategies, optimize our boutique fleet, broaden our customer reach with brand extensions and drive sustainable, profitable growth. Approval of these First Day motions helps provide the flexibility we need to complete this process quickly and efficiently," Clarke added.

francesca’s^® commenced its voluntary chapter 11 cases to reorganize under chapter 11 of the U.S. Bankruptcy Code on December 3, 2020. francesca’s^® has retained, subject to Bankruptcy Court approval, the services of O’Melveny & Myers LLP and Richards Layton & Finger, P.A. as bankruptcy counsel and FTI Consulting, Inc. and FTI Capital Advisors LLC as the Company’s financial advisor and investment banker.

Additional Information

Additional information about the proposed asset sale, as well as other documents related to the restructuring and reorganization proceedings, is available through francesca’s case website at https://cases.stretto.com/francescas

About Francesca's Holdings Corporation
francesca's^® is a specialty retailer that operates a nationwide-chain of boutiques providing customers a unique, fun and personalized shopping experience. The merchandise assortment is a diverse and balanced mix of apparel, jewelry, accessories and gifts. As of today, francesca's^® operates approximately 558 boutiques in 45 states throughout the United States and the District of Columbia and also serves its customers through francescas.com and its iOS mobile app. For additional information on francesca's^®, please visit www.francescas.com.

Company Contact:         
Cindy Thomassee
832-494-2240
IR@francescas.com

FAQ

What financing did Francesca's obtain during its bankruptcy?

Francesca's obtained interim approval for $15 million of debtor-in-possession (DIP) financing.

When is the final hearing for Francesca's asset sale procedures?

The final hearing for the asset sale procedures is scheduled for January 4, 2021.

What is the status of Francesca's business operations during bankruptcy?

Francesca's is allowed to continue operations in the ordinary course while pursuing a sales process.

What is the main purpose of Francesca's Chapter 11 filing?

The main purpose is to reorganize financially and seek a new investor to stabilize the company.