Frisby Technologies, Inc. announced that it has filed a voluntary petition for Chapter 11 reorganization with the U.S. Bankruptcy Court for the Middle District of North Carolina.
In connection with the company’s Chapter 11 filing, the Company further announced that it has reached agreement with its secured creditor group to provide debtor-in-possession (DIP) financing. Upon court approval, the new funding will be available immediately on an interim basis to supplement the Company’s existing capital and help the company fulfill obligations associated with operating its business, including its payroll and employee-related expenses, and payments to suppliers and service providers for goods and services provided after today’s filing.
In conjunction with today’s petition for Chapter 11 reorganization, the Company will ask the Bankruptcy Court to consider a variety of “first day motions” to support its employees, suppliers, customers and other constituents. These include motions seeking court permission to continue payments for employee payroll and health benefits; obtain interim financing authority and use of cash collateral; and retain legal, financial and other professionals to support the company’s reorganization actions.
According to Mark Gillis, the Company’s recently appointed Chief Restructuring Officer, “Today’s action was a necessary first step in the process to reorganize the business and maximize value for all of the Company’s creditors. We are grateful to the secured lenders for providing the DIP financing that will enable the Company to continue to conduct business as usual as we carefully explore our strategic alternatives and develop a reorganization plan that is satisfactory to all parties with an interest in this case.”
Duncan R. Russell, President and Chief Operating Officer, added, “It is important for our customers, licensees and global business partners to know that today’s action was made in order to ensure that they continue to be able to order and we will still be able to supply the full range of COMFORTEMP(R) branded products, including our fabrics and nonwovens. It is our intention to do everything possible to preserve the value of our brand, retain our leadership status in the temperature-balancing materials market and emerge from bankruptcy as a stronger company.”
The Company’s principal legal advisor with regard to the Chapter 11 filing and related matters is Ivey, McClellan, Gatton, & Talcott LLP of Greensboro, NC.
