Update (1011ET): Despite expectations of an imminent filing, JC Penney announced Friday morning that it had made a $17 million interest payment that was due on May 7. JCP had entered the "grace period" after missing the payment. During that time, it "evaluated strategic alternatives" and, apparently, ultimately decided to buy itself more time.
Here's the key quote from the filing:
On May 14, 2020, J. C. Penney Company, Inc. and J. C. Penney Corporation, Inc. (“JCP” and, together with J. C. Penney Company, Inc., the “Company”) made the approximately $17 million interest payment (the “Interest Payment”) that was due and payable on May 7, 2020 with respect to JCP’s senior secured term loan credit facility (the “Term Loan Facility”). Under the credit and guaranty agreement governing the Term Loan Facility, the Company had a grace period of five business days to make the Interest Payment before such non-payment would constitute an “event of default” thereunder. The Company had entered into such grace period in order to evaluate certain strategic alternatives, none of which have been implemented at this time and which continue to be considered.
But why would the company make this payment if its planning on filing for bankruptcy protection in the coming days?
*.*.*
JC Penney shares have been halted Friday morning just minutes after the open as the company is widely expected to file for Chapter 11 bankruptcy protection.
*JC PENNEY IS HALTED FOR NEWS PENDING
— Tom Flatten The Curve Hearden (@followtheh) May 15, 2020
We have been closely following the trials and tribulations of JCP, Neiman Marcus...