Hancock Fabrics filed with the U.S. Bankruptcy Court a motion for an order setting a date to conduct an auction of the Debtors’ interests in certain non-residential real property leases and a hearing date for approval of an auction; approving bid procedures and terms of auction; establishing cure amounts; authorizing the Debtors to enter into lease termination agreements; approving the abandonment of personal property; approving and authorizing the sale of leases to the highest or best bidder free and clear of all liens, interests, claims and encumbrances.
The motion explains, “Under the Agency Agreement, the Store Closing Sales for Closing Stores are to be completed by July 31, 2016, subject to further extension upon mutual agreement between Hancock and the Sale Agent. Upon completion of the Store Closing Sales, the Debtors will remain obligated under the Leases for those stores. The Debtors, in consultation with RCS Real Estate Advisors (‘RCS’), have determined that certain of the Leases for Closing Stores may have value that should be realized through an orderly sale and auction process for the benefit of creditors. Since being retained in December, RCS has been analyzing the Leases and marketing them to persons and entities that may have strategic interest in the Leases, as well as to the landlords for the Leases.”
The motion continues, “Essential to the relief requested is the dual track nature of the proposed auction process with the Store Closing Sales which are anticipated to be completed by July 31, 2016.”
The Debtors also filed a separate motion for entry of an order setting a date to conduct an auction of the Debtors’ interests in certain intellectual property assets and a hearing date for approval of the auction; approving bid procedures and terms of the auction; establishing cure amounts; approving and authorizing the sale of intellectual property to the highest or best bidder free and clear of all liens, interests, claims and encumbrances.
The deadline to submit qualified competing bids for both motions is June 16, 2016, and – if one or more qualified bids are received – a June 21, 2016 auction and June 30, 2016 sale hearing will follow. The Court scheduled a May 26, 2016 hearing to consider both the motions.
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