The Associated Press March 30, 2011, 9:27AM ET

Harry & David gets approval for $100M in financing

Fruit basket and gifts retailer Harry & David Holdings Inc. received court approval to access $100 million in financing as it reorganizes under Chapter 11 bankruptcy protection.

The U.S. bankruptcy Court for the District of Delaware approved the company's "first-day" motions that will allow the company to continue to operate normally as it reorganizes.

Harry & David filed for Chapter 11 bankruptcy protection Monday, after struggling to remain afloat during an uncertain economy and as competitors proliferated.

In addition to the $100 million debtor-in-possession financing, Harry & David can access a secondary $55 million loan provided by senior note holders.

The court also gave Harry & David approval to continue to pay employee salaries and benefits, as well as its suppliers for goods and services provided after the bankruptcy filing. Programs like its "fruit of the month club" will also continue and gift cards will be honored.

The next bankruptcy hearing for the privately held Medford, Ore., company will be April 27.


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