Ritz Camera seeks approval of bidding procedures; auction on Sept. 4

By Jim Witters

Wilmington, Del., July 9 - Ritz Camera & Image, LLC is seeking court approval of bidding procedures for the sale of substantially all of the company's assets, according to documents filed July 9 with the U.S. Bankruptcy Court for the District of Delaware.

"While the debtors believe their business, as being restructured ... is a very valuable business with great potential for continuing as a profitable business while sustaining its market position ... the business requires new capital from a new owner to realize the benefits of this potential," the motion states.

Under the terms of the debtor-in-possession financing facility, the company must sell its assets as a going concern or liquidate the business by Sept. 14.

The company plans to seek going-concern offers, liquidating bids and other bids and combinations of bids, according to the court filing.

The DIP facility also requires the company to execute documents with a stalking-horse bidder by Aug. 16.

As previously reported, the company plans to close 128 of its retail stores and market the remaining 137.

Bidding procedures

Under the proposed sale process:

• A hearing to approve the bid procedures is scheduled for 9:30 a.m. ET on July 30;

• The bidding deadline is 4 p.m. ET on Aug. 28;

• An auction, if needed, is scheduled for 10 a.m. ET on Sept. 4;

• The debtors, with the DIP lenders and the official committee of unsecured creditors, will determine how to conduct the auction if bids are received on differing packages of assets;

• The minimum bidding increment will be announced at the auction;

• The stalking horse would be entitled to a breakup fee of 2%; and

• The sale hearing will be no later than Sept. 10.

"The bidding procedures set for a flexible process by which the debtors will be soliciting bids on both a going-concern basis for their assets and bid on a non-going-concern basis, including bids for the right to act as agent on the liquidation of the debtors' inventory," the court documents state.

Ritz Camera & Image, a Beltsville, Md.-based specialty camera and image chain, filed for bankruptcy on June 22. Its Chapter 11 case number is 12-11868.

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