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<pre>Quality Stores, Inc. Files Voluntary Chapter 11
Petition Under U.S. Bankruptcy Code
</pre>
MUSKEGON, MI - November 1, 2001 announced today that it has commenced voluntary reorganization proceedings under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the Western District of Michigan. The Company intends to continue to maintain its business and operations.
Quality Stores intends to focus its operations on a core group of 178 stores and two distribution centers focused on markets in the eastern U.S., historically its strong markets. The Company anticipates that its cash collateral and cash flow from operations moving into its strongest selling season will provide adequate liquidity. “Quality Stores has made considerable progress in reducing its costs and streamlining its operations. A voluntary Chapter 11 petition provides us a process and framework within which we can continue to address the significant issues facing the Company,” said Peter Fitzsimmons, Quality Stores’ Chief Executive Officer.
On October 20, 2001, Quality Stores announced that a group of three bondholders filed an involuntary bankruptcy petition demanding payment for certain debt obligations. The Company also previously announced its intent to close a total of 133 stores and two distribution centers. “We acknowledge the hard work and dedication of all of our employees and regret the impact our decision will have on those who have worked loyally in our western markets,” Said Bill Waack, the Company’s President and Chief Operating Officer.
Quality Stores, Inc., operating stores under the names of Quality Farm & Fleet, Quality Farm & Country, County Post, and Central Tractor Farm & Country, is a specialty retailer targeting the ranch, farm, and “ruralpolitan” customer.
Stores feature an assortment of over 25,000 products from more than 1,200 vendors. Product categories include Agriculture, Animal Health, Feeds, Pet, Truck & Trailer, Home Improvement, Hardware, Electrical, Plumbing, Lawn & Garden, Energy, and Clothing.
<pre>QUALITY STORES, INC. RESPONDS TO
INVOLUNTARY BANKRUPTCY FILING BY BONDHOLDERS
</pre>
MUSKEGON, MI - October 22, 2001 Quality Stores, Inc., today announced that an involuntary petition under the United States Bankruptcy Code was filed in the United States Bankruptcy Court for the Western District of Michigan in Grand Rapids. The involuntary petition was filed by a group of holders of the 10 5/8% senior notes on Saturday, October 20, 2001. Under laws relating to an involuntary bankruptcy filing, the Company is permitted to operate its business in the ordinary course, unless the Court orders otherwise.
The Company said that it is evaluating its options as it determines how to continue with the financial and business restructuring that has been ongoing for several months. The Company also continues to work with legal and financial advisors specifically engaged to assist it in its restructuring efforts.
As part of the business restructuring, the Company also has announced that it intends to close 133 stores. Most of the stores to be closed are located west of the Mississippi River. 178 stores will continue to operate as normal east of the Mississippi River. The Company intends to concentrate its efforts going forward on core markets in the Midwest and East. Stores will remain open in the following states: Michigan, Ohio, Indiana, New York, Pennsylvania, New Jersey, Delaware, Maryland, Vermont, Massachusetts, Virginia, West Virginia, and Kentucky.
The Company said that it intends to continue to pay employees’ pre-petition and post-petition wages, salaries, and benefits without interruption.
Quality Stores, Inc. is a specialty retailer of farm and agriculture-related merchandise with headquarters in Muskegon, MI.
__________~from the web~_______________
Discussion of Stores Closing