Shane Co. announced that it has filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court in Denver.
The 38-year-old company, based in Centennial, Colo., said it plans to continue operating the business without interruption as management focuses on developing and executing a comprehensive restructuring plan.
Company attorney Caroline Fuller told JCK said it had secured “interim use of cash collateral.”
A company statement said, “In conjunction with today’s filing Shane Co. has filed a variety of first day motions to support its employees, vendors and customers; to obtain interim financing authority and maintain existing cash management programs; to retain legal, financial and other professionals; to support the Company’s reorganization case; and for other relief.”
The statement said the company suffered from “disappointing” holiday sales. It said the “Chapter 11 filing is being used to proactively address the company’s capital structure, while ensuring adequate inventory and operations by paying vendors, suppliers and other business partners for goods and services provided post-petition. In addition, the Company has sought Court authorization to continue honoring existing customer service programs and provide employee wages and salaries, including health benefits and accrued vacation without interruption.”
“The severity of this past holiday season dramatically impacted existing liquidity requiring the Company to seek this bankruptcy protection,” said Tom Shane, chief executive officer, the third generation in the Shane family to be involved in the jewelry business. “By taking this action, I can provide job security to my loyal employees. I know that we will emerge from this situation as a stronger and healthier company that will be well positioned to reach its full potential.”
The company listed both assets and debt of $100 million to $500 million in Chapter 11 documents filed Monday in U.S. Bankruptcy Court in Denver, according to media reports.
Shane Co. operates 23 stores in 14 states. It was founded as Western Stone and Metal.