Crumbs Bake Shop Inc (OTCMKTS:CRMBQ) announced that all of the First Day Motions related to its voluntary Chapter 11 process and bidding procedures for the auction process have been approved by the United States Bankruptcy Court of New Jersey.
The First Motions allows Crumbs Bake Shop Inc (OTCMKTS:CRMBQ) to maintain its current operations while pursuing a sale through the Chapter 11 process.
The company has been granted access to debtor-in-possession (DIP) financing from Lemonis Fischer Acquisition Company to ensure that it would continue to meet its financial obligations such as paying the wages and benefits of employees during the Chapter 11 process. It also received authority to close certain locations.
Edward M. Slezak, CEO and General Counsel of Crumbs Bake Shop Inc (OTCMKTS:CRMBQ) said the approval of the First Day Motions is an important milestone in the company’s Chapter 11 process.
“We are confident that Crumbs is taking the right steps to protect the brand and position the company for long-term success,” said Slezak.
Crumbs Bake Shop aims to reopen select locations
According to Slezak, they are evaluating the retail strategy of Crumbs Bake Shop Inc (OTCMKTS:CRMBQ) with an objective to reopen select locations. He said the management team of the company plans to take time in the evaluation process and will continue their strategy to focus on licensing and franchising opportunities. He said they had success in signing licensees for Crumbs’ baked goods as well as introducing new products.
Sale transaction ensures future for Crumbs Bake Shop
According to Slezak, the management carefully evaluated opportunities to strengthen the financial position of Crumbs Bake Shop Inc (OTCMKTS:CRMBQ), and remained convinced that pursuing a sale transaction will ensure a strong future for its brand and business.
He is confident that Crumbs Bake Shop Inc (OTCMKTS:CRMBQ) will achieve the best possible outcome for its business and stakeholders by evaluating all offers through a court-supervised auction process.
Crumbs Bake Shop Inc (OTCMKTS:CRMBQ) filed a voluntary Chapter 11 petition to the U.S. Bankruptcy Court for the District of New Jersey to facilitate the sale of its business and to restructure its balance sheet last June 11.
The company entered an agreement with Lemonis Fischer Acquisition Company to provide an initial stalking horse bid during the court-supervised auction process. Crumbs Bake Shop Inc (OTCMKTS:CRMBQ) expects to complete the sale process in 60 days pending receipt of necessary approvals from the bankruptcy court.
Crumbs Bake Shop Inc (OTCMKTS:CRMBQ) plans to submit its sale transaction timeline to the court on July 24.