Payless Shoesource bankruptcy plan approved by court, paving way … – Topeka Capital Journal

A St. Louis judge has accepted Payless Shoesources plan for reorganization, a move that will help the company achieve its goal of leaving bankruptcy by August with a significantly lighter debtload.

Payless spokeswoman Meghan Spreer said the company is not commenting on the plan until everything is finalized, but should have a statement within the next few weeks.

Chief Judge Kathy A. Surratt-States, U.S. Bankruptcy Court for the Eastern District of Missouri, approved the plan last week.

Payless entered bankruptcy in April with $838 million in debt. Senior lenders owed $506.3 million will receive a 91 percent equity stake in the company, while junior lenders, owed $145 million, will receive the remaining nine percent, according to bankruptcy documents.

General unsecured creditors will receive pennies on the dollar for their debt.

Many Topeka companies hold Payless debt, but most refused to discuss the impact it, saying they hoped to continue to do business with Payless.

Since the announcement, Payless has treated us professionally and fairly. We are hoping to continue a strong relationship with them going forward, said Paul Bossert, president of Premier Employment Solutions.

According to bankruptcy filings, Premier was owed $12,483, while another associated company, Premier Personnel Inc., was owed $7,363.

Amounts owed to Topeka businesses varied considerably, from just $150 owed to Harvesters of Topeka to $31,570 owed to Stacks LLC and $139,041 owed to ISS Facility Services of Topeka.

Bettis Asphalt &Construction was left with a bill of $23,300, confirmed Rich Eckert, the companys general counsel. The bill was for one job finished in December 2016. Eckert said the company probably will be paid $4,000 to $5,000 on the debt.

These were loading dock repairs out at their warehouse, he said. The part that burns us is that more than likely, they knew they were taking this bankruptcy while we were out there working, knowing that we would never get paid. Thats a hard pill to swallow.

Eckert said bankruptcies were more frequent during the recession and that, fortunately, its not something Bettis runs into frequently.

While some local companies werent owed dollars when Payless filed bankruptcy, they are missing the business they did with the company and are hopeful the reorganization sets Payless up for a successful future.

We didnt have any loss except for we arent continuing to print for them, said Janice Salsbury, bookkeeper for Capital Graphics. We have missed their business because they are a good client, friendly, easy to work with. Were sorry because its a major business in Topeka.

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Payless Shoesource bankruptcy plan approved by court, paving way ... - Topeka Capital Journal