- Enters into commitment letter with CIBC for $25 million secured credit facility
SYMBOL: HIS (TSXV)
LAVAL, QC, Jan. 20, 2012 /CNW Telbec/ - Hart Stores Inc. (TSXV: HIS) announces that the Québec Superior Court today granted an Order authorizing Hart Stores to file a Plan of Arrangement under the Companies' Creditors Arrangement Act (Canada). The Plan of Arrangement calls for Hart Stores to make payments totaling $6 million over three years to the Monitor (RSM Richter Inc.) under the CCAA, for distribution to Hart Stores' creditors. Under the Plan of Arrangement, creditors may elect to receive their pro rata share of the $6 million, or a lump-sum payment equal to the lesser of the value of their claim or $1,000.
Hart Stores will call a meeting of creditors to vote on the Plan of Arrangement, expected to be held in February. If the Plan of Arrangement is approved by creditors at the meeting, it will be presented to the Québec Superior Court for ratification.
Today's Order also extended to March 14, 2012 the period during which all proceedings on the part of Hart Stores' creditors are stayed. This is a further extension of the stay period initially granted by the Superior Court on August 30, 2011. The Order also granted a concurrent extension to March 14, 2012 of the maturity date of Hart Stores' interim credit facility with Wells Fargo Capital Finance Corporation Canada.
Hart Stores is also pleased to announce that it has entered into a commitment letter with CIBC Asset-Based Lending for a secured credit facility of up to $25 million. The new credit facility is intended to replace Hart Stores' existing credit facility with Wells Fargo Capital Finance Corporation Canada, in order to fund the Company's operations upon completion of its financial restructuring under the CCAA.
The new credit facility with CIBC Asset-Based Lending is conditional upon numerous factors, including execution of appropriate legal documentation and registration of security, termination of Hart Stores' existing credit facility with Wells Fargo Capital Finance Corporation Canada, CIBC's satisfaction with the Plan of Arrangement and the other terms and conditions of Hart Stores' exit from CCAA proceedings, and the obtaining by Hart Stores of all necessary creditor and court approvals relating to the Plan of Arrangement on terms and conditions satisfactory to CIBC.
RSM Richter Inc. has been appointed Monitor pursuant to the Initial Order of the Québec Superior Court. All inquiries regarding the CCAA proceedings should be directed to the Monitor. Further information about Hart Stores' restructuring can be found on the Monitor's website at the following address: http://www.rsmrichter.com/Restructuring/Hart.aspx.
About Hart Stores Inc.:
Hart Stores Inc. operates a network of 88 mid-sized department stores of which 28 stores have been slated for closure in early 2012, under the Hart, Bargain Giant and Géant des Aubaines banners. The stores are located in secondary and tertiary markets throughout Eastern Canada where the Company has established a dominant position in many of the communities that it serves. The stores offer an extensive and differentiated selection of national and exclusive fashion apparel brands as well as family footwear, home furnishings, electronics, appliances, giftware, toys and seasonal goods.
Forward-Looking Statements and Disclaimer
Certain statements included in this press release may constitute "forward-looking statements" within the meaning of the Canadian securities legislation. Forward-looking statements are based on the best estimates available to Hart Stores at the time and involve known and unknown risks, uncertainties and other factors that may cause Hart Stores' actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. A description of the risks affecting Hart Stores' business and activities appears under the heading "Risks & Uncertainties" in Management's Discussion and Analysis on pages 18 to 20 of Hart Stores' 2011 Annual Report, which is available on SEDAR at www.sedar.com. No assurance can be given that any events anticipated by the forward-looking information in this press release will transpire or occur, or if any of them do so, what benefits that Hart Stores will derive therefrom. In particular, no assurance can be given as to the future financial performance of Hart Stores. Undue reliance should not be placed on these forward-looking statements, which are made only as of the date of this press release. Hart Stores disclaims any intention or obligation to update or revise any forward-looking statements in order to account for any new information or any other event.
For further information:
Hart Stores Inc.
Mr. Robert Harritt
Vice-President Finance and Chief Financial Officer
Hart Stores Inc.
(450) 661-4155, ext. 595
RSM Richter Inc. (Monitor)
Benoit Gingues, CA
Partner, RSM Richter Inc. (514) 934-3514
Stéphane De Broux, CA
Vice President, RSM Richter Inc. (514) 934-8621