Rhodes, Inc. Receives Court Approval of Final Dip Order

Furniture World Magazine

Rhodes, Inc. reported that the bankruptcy court granted final approval of its $88 million debtor-in- possession (DIP) credit facility. The facility is being provided by a group of lenders led by Wells Fargo Retail Finance and Back Bay Capital Funding. The Company had received interim approval of the DIP facility pursuant to a "first day order" approved by the bankruptcy court on November 9, 2004. Rhodes filed a voluntary petition to restructure under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Northern District of Georgia on November 4, 2004. The DIP financing, combined with the Company's cash from operations, is expected to provide funding for the Company's operations during the Chapter 11 process, and will expire on May 4, 2006. The Company is in compliance with all of the terms and conditions of the DIP credit agreement. "This is an important milestone in enabling Rhodes to reorganize and emerge as a strong, viable furniture retailer," said Steven S. Fishman, CEO, CRO and President of Rhodes. Mr. Fishman continued, "Final approval of our DIP credit facility allows us to continue to serve our customers and honor our obligations to our suppliers and to our employees while we complete our reorganization." Rhodes, Inc., headquartered in Atlanta, Georgia, is one of the largest furniture retailers in the country, offering brand-name residential furniture to middle- and upper-middle-income customers through 63 stores located in 12 southern and midwestern states.