A U.S. Bankruptcy Judge in Delaware has approved FAO Inc.’s reorganization plan, clearing the way for the toy cataloger and retailer to emerge from Chapter 11 bankruptcy protection.
The King of Prussia, PA company said will begin making paying creditors pursuant to the terms of its plan, which takes effect later this month.
FAO has received a commitment for up to $77 million in bank financing for operational expenses once the plan becomes effective. The bank financing includes a $67 million revolving credit facility being provided by a group of banks led by Fleet Retail Finance Inc. and a $10 million term loan being provided by Back Bay Capital Funding LLC.
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