Fortunoff asks court to dismiss bankruptcy case

By Caroline Salls

Pittsburgh, Aug. 19 - FFJS, formerly known as Fortunoff, asked the U.S. Bankruptcy Court for the District of Delaware to dismiss its Chapter 11 bankruptcy case, according to a Monday court filing.

Since it closed the sale of substantially all of its assets, the company said it has been working with its official committee of unsecured creditors to wind up its affairs, including rejecting its real property and other unexpired leases and contracts that were not assumed and assigned under the sale and liquidating or recovering the few remaining assets not previously purchased.

FFJS said the sale proceeds were not enough to pay any portion of its obligations to its junior secured lenders.

To complete the wind down, the company said the term D lender agent has agreed to allow a gift and/or charge against the term D cash collateral to pay up to $850,000 of the wind-down costs.

While no distributions will be made to pre-bankruptcy creditors or equity holders, FFJS said the post-bankruptcy administrative expenses of winding down the estates will be paid in full.

Fortunoff, a Westbury, N.Y., fine jewelry and home furnishings retailer, filed for bankruptcy on Feb. 4, 2008. Its Chapter 11 case number is 08-10353.

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