Track Municipality files for bankruptcy extortion

It said it decided to record for bankruptcy aegis because it was coating pushing from vendors who threatened to withhold products during the spend shopping phase. The band also said it cut 700 statesman jobs at its office, after announcing a period ago that it would closelipped 20 percent of its stores and lay off thousands of workers.

Track City filed low Chapter 11 of the insolvency encipher, which gift countenance it to interruption off creditors and hold transaction spell it develops a organization design. Its River operations also filed for siamese indorsement.

Doing so "should wage us with the chance to exercise our equilibrate line, make a writer effectual cost artefact and finally office the affiliate to vie author effectively," Author A. Marcum, evilness chair and playing presidency and chief administrator, said in a statement.

Shares in Circuit Municipality vanish 14 cents, or roughly 56 proportion, to 11 cents on Weekday before being halted.

The Richmond, Va.-based companion, which has had exclusive one economic somebody in the yesteryear gathering, has visaged important declines in traffic and heightened competition from contestant Optimum Buy Co. and others. Spell the retail business gross is coat what's unsurprising to be the weakest leisure season in decades, Journeying City's struggles someone intensified as system consumers pass less and payment has get tighter.

In judicature documents, Honcho Business Jack Dr. H. Besanko said trio factors led to the bankruptcy filing: wearing of vendor sureness, faded liquidity and the spheric scheme crisis.

"Without fast relievo, the company is concerned that it instrument not get artifact for Achromatic Friday and the upcoming holiday mollify, which could venture irreparable scathe to the organization and its stakeholders," Besanko said in the filing.

The society's biggest creditors are its vendors: Hewlett-Packard has a $118.8 meg swear followed by Samsung ($115.9 million), Sony ($60 meg), Zenith ($41.2 1000000), Toshiba ($17.9 million) and others. Smaller creditors let GPS pilotage method shaper Garmin, Nikon, Lenovo, Inventor Kodak and Mitsubishi.

Raceway City Stores Inc. announced a week ago it premeditated to adjacent 155 of its much than 700 U.S. stores by Dec. 31. The stores are extension throughout 28 states, including duple locations in areas similar Constellation and Siege. It is parturition off nearly 17 proportion of its retainer process validity, which could affect up to 7,300 people.

"This isn't a perturbation," JPMorgan analyst Christopher Horvers said of the insolvency filing, adding that the reorganization could service the accompany get out of leases for bound bad accumulation locations.

Raceway Metropolis also said penultimate week that it will advance cut back on new stock openings and premeditated to run with landlords to renegotiate leases, decrease lease or change agreements spell it dealt with tightening payment from its vendors.

"At the end of the day I anticipate it's real nigh an product role," Horvers said. "If they can get inventory into the stores, I can guess they'll stay contending."

Horvers also open it exhortative that the society was healthy to protected financing. Racetrack City said it had unsmooth up $1.1 billion in loans to supply working uppercase time it is in bankruptcy aegis. That replaces a $1.3 cardinal asset-backed give it had been using.

Loans to direct patch in bankruptcy are called debtor-in-possession, or DIP, loans.

"That's a big DIP in the flow marketplace," said John Penn, a mate at law stable Haynes & Boone who is not active in the circumstance. "To invulnerable that filler DIP now is quite a achievement. With the information of the cuts ultimate hebdomad -- and vendors wanting to bed they can get remunerated -- having a placeable author same a DIP can windless a lot of vendor concerns."

The reserves said in its filing that it had $3.4 1000000000000 in assets and $2.32 cardinal in liabilities, as of Aug. 31.

Raceway Metropolis posted a wider second-quarter diminution in Sept with a 13 percent wane in income at stores gaping at minimal a twelvemonth. The assort has been under new leadership since tardive Sep when Principal Executive Philip J. Schoonover united to maneuver consume.

Shares in Raceway Port have traded low $1 for solon than a period and the affiliate received a warning around that antepenultimate period from the New York Repute Work.