SYRACUSE, N.Y.–(BUSINESS WIRE)–The Penn Traffic Company (OTC: PTFC) and its primary subsidiaries filed voluntary petitions for protection under Chapter 11 of the U.S. Bankruptcy Code on November 18, 2009.
In order to ensure sufficient liquidity to maintain ongoing operations in the face of current lender defaults, Penn Traffics board of directors determined that the interests of the companys creditors and other stakeholders would be best served by seeking Chapter 11 bankruptcy protection to facilitate an orderly sale of its stores and other assets with the consent of its senior secured lenders.
Our P&C, Quality and BiLo supermarkets remain open for business to serve our customers and communities, President and Chief Executive Officer Gregory J. Young said. We intend to continue to work closely with our vendor partners to provide the fresh products and good value that our customers have come to expect from our stores.
The company will continue to manage its properties and operate as debtors-in-possession under the jurisdiction of the U.S. Bankruptcy Court for the District of Delaware and in accordance with the applicable provisions of the Bankruptcy Code.
In connection with the petition, Penn Traffic filed a motion seeking the Bankruptcy Courts approval of, among other things, a consensual cash collateral arrangement with its senior secured lenders to allow it to have sufficient liquidity to maintain normal business operations during the sale process. The Company expects to present this arrangement to the Bankruptcy Court for approval at a court hearing anticipated for Thursday, November 19, 2009.
Source: The Penn Traffic Company