Updated 5-27-20 at 4:59 p.m.
CULLMAN, Ala. – Tuesday Morning Corporation on Wednesday announced it has filed voluntary petitions for protection under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Texas – Dallas Division. According to a media release from the company, the move is “in response to the immense strain the COVID-19 pandemic and related store closures have put on the business.”
The company will close approximately 230 of its 687 stores “to focus on high-performing locations and will do this with a phased approach. The store closure process will take place over the summer. The Company has requested bankruptcy court approval to close at least 132 locations in a first phase and, eventually, the Company’s distribution center in Phoenix that supports these stores.”
According to court documents, the list of 132 locations includes the Cullman store at Town Square Shopping Center, 1646 Town Square SW.
Drinkard Development Vice President of Administration and Development Jason Grimmett said he is aware of the bankruptcy filing, but is hopeful the Cullman store, which occupies property owned by Drinkard, can be saved.
“We received notification this morning that Tuesday Morning had filed Chapter 11 bankruptcy. Chapter 11 allows the entity filing the chance to basically reorganize and restructure their operations in an attempt to keep stores that perform good and to close underperforming stores,” said Grimmett. “We are optimistic that we will have an opportunity to restructure our lease with them in Cullman. They have been a part of Town Square for 10 years and we greatly value their presence in Cullman.”
A representative of the Cullman store told The Tribune, “We do not have any information at this time.”
Steve Becker, Chief Executive Officer, stated, “The prolonged and unexpected closures of our stores in response to COVID-19 has had severe consequences on our business. Prior to the pandemic, we were gaining momentum in our merchant organization, growing our vendor base and improving brands, assortment and value for our customers, while investing in our technology and corporate leadership team. However, the complete halt of store operations for two months put the Company in a financial position that can be effectively addressed only through a reorganization in Chapter 11.”
Becker continued, “We plan to emerge from Chapter 11 in a stronger position as a leading home goods off-price retailer, providing unmatched value to our customers. The commitment from our lenders to provide access to significant capital demonstrates faith in our value-driven business model and iconic brand. Looking ahead, we’ve been encouraged by very positive performance of the business as we continue to re-open our doors and welcome back our dedicated customers.”
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