Tops’ Bankruptcy Objectives
Tops hopes to complete its bankruptcy process in roughly six months. During its first three months, it plans to focus on creditor negotiations. Then, if all goes well, it will implement its negotiated plan. Towards that end, it has agreed to some milestones:
- April 2, 2018: Entry of final orders approving its financing;
- May 7, 2018: Execution of a restructuring support agreement with key lenders;
- July 21, 2018: Filing of a disclosure statement and solicitation of a plan acceptable to its key lenders, with confirmation 60 days thereafter.
Financing to Support Its Operations
The company says it has sufficient liquidity to fund operations, and it plans to continue business as usual. It has been negotiating with an ad hoc committee of its senior secured noteholders regarding a “consensual deleveraging transaction.” (In English, Tops has asked its secured lenders to forgive some of its debt.) That committee will provide a $125 million loan to support the bankruptcy filing. And Bank of America, the company’s asset-based lender, will provide a $140 million, revolving credit facility.
In addition, the court has authorized Tops to pay up to $10 million to vendors for goods delivered postpetition and up to $5.3 million for employee wages. And C&S Wholesale Grocers, which procures most of the company’s for-resale goods, has agreed to provide Tops with an additional week of trade terms.