Peekay Acquisition proposes plan based on sale and global settlement

By Caroline Salls

Pittsburgh, Oct. 5 – Peekay Acquisition, LLC filed its Chapter 11 plan and related disclosure statement on Oct. 4 with the U.S. Bankruptcy Court for the District of Delaware.

The company said it reached a global settlement with its term A lenders, the proposed purchaser of its assets and the official committee of unsecured creditors appointed for its Chapter 11 case.

Peekay said that settlement forms the foundation of the plan, which provides for the sale of substantially all of the company’s assets to TLA Acquisition Corp., subject to higher or otherwise better offers.

The plan also calls for the assumption of some liabilities as part of the asset purchase agreement and for the wind-down of the Peekay debtors’ estates.

Under the plan, administrative claims, priority tax claims, priority non-tax claims and other secured claims will be paid in full in cash.

Holders of term loan A claims will receive the value of a credit bid if the sale to TLA is completed. If not, these creditors will receive cash or other consideration from the sale of Peekay’s assets.

Holders of term loan B claims, trade vendor and seller note claims, general unsecured claims, intercompany claims, subordinated claims and interests will receive no recovery.

Ultimate parent and Chapter 11 debtor Peekay Boutiques, Inc. is a retailer of lingerie, women’s wellness and sexual health products based in Auburn, Wash. The company filed for bankruptcy on Aug. 10 under Chapter 11 case number 17-11722.

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