RICHMOND, Va.–Adding to the list of retail bankruptcies, Circuit City Stores has filed a petition for reorganization relief under Chapter 11 in the United States bankruptcy court for the Eastern District of Virginia.
The company plans to continue operating the business without interruption as management focuses on developing and executing a comprehensive corporate restructuring plan.
In conjunction with the filing, Circuit City is seeking authority from the Bankruptcy Court that will enable it to continue operating its business and serving its customers. The requested approvals include requests for the authority to make wage and salary payments; continue benefits for employees; and honor customer programs such as returns, exchanges and gift cards.
Circuit City has also negotiated a commitment for a $1.1 billion debtor-in-possession revolving credit facility to supplement its working capital. The facility provides immediate liquidity while the retailer works to reorganize the business, and will enable it to pay vendors and other business partners for merchandise and services received after the filing.
Last week, the retailer set plans to shutter 155 stores.