Stein Mart Inc. announced that it and its subsidiaries have filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Middle District of Florida – Jacksonville Division. The company has filed customary motions with the Court that will authorize, upon Court approval, the company’s ability to maintain operations in the ordinary course of business, including, among other things, the payment of employee wages and benefits without interruption, payment of suppliers and vendors in the normal course of business, and the use of cash collateral. These motions are typical in the Chapter 11 process and the company anticipates that they will be approved shortly after the commencement of its case.
The company expects to close a significant portion, if not all, of its brick-and-mortar stores and has launched a store closing and liquidation process. It is evaluating any and all strategic alternatives, including the potential sale of its e-commerce business and related intellectual property.
“The combined effects of a challenging retail environment coupled with the impact of the coronavirus (COVID-19) pandemic have caused significant financial distress on our business,” said Hunt Hawkins, CEO and CFO of Stein Mart. “The company has determined that the best strategy to maximize value will be a liquidation of its assets pursuant to an organized going out of business sale. The company lacks sufficient liquidity to continue operating in the ordinary course of business. I would like to thank all of our employees for their dedication and support.”
