Wet Seal to Proceed with B. Riley, Despite Versa’s Attractive Terms
Dow Jones & Company reported Wet Seal received initial approval from a bankruptcy judge January 20, 2015, to proceed with DIP financing from B. Riley, despite a last-minute offer from Versa Capital offering attractive financing terms.
Dow Jones also wrote that Judge Christopher Sontchi of the U.S. Bankruptcy Court in Wilmington, DE, said he was satisfied Wet Seal’s choice to continue with B. Riley was a sound business decision even though Versa had offered financing on better terms.
According to court documents filed January 19, 2015, Gregory L. Segall, chairman and CEO of Versa Capital Management, submitted a letter to The Wet Seal’s board of directors c/o the company’s president and CEO, Edmond Thomas, dated January 19, 2015, that states, among other points:
“With respect to the Plan Sponsorship Agreement:
The letter also said:
“With respect to the DIP Term Loan:
Regarding the company’s decision to choose B. Riley, Dow Jones added The Wet Seal’s lawyer, Michael Tuchin of Klee, Tuchin, Bogdanoff & Stern, said the company preferred to continue working with B. Riley, which had engaged in a long due diligence process and is familiar with the company’s “warts,” while Versa has only had access to public information and hadn’t engaged in the same due diligence.
To read the letter sumitted by Versa Capital Management, click here.
Previously on abfjournal: B. Riley, Great American Provide Wet Seal DIP Financing, January 19, 2015
To read the entire Dow Jones article, click here.