August 17, 2019

Press Release

Southeastern Grocers Commences Previously Announced Restructuring

Restructuring has 100% Support of Creditors and Interest Holders that Have Voted

| 3/28/2018
  • As Indicated in its Previous Restructuring Agreement Announcement, Company Commences Pre-Packaged Chapter 11 Cases to Efficiently Execute Restructuring
  • More than 580 of SEG's Iconic, Heritage Banners to Continue Operating in the Ordinary Course; Company Dedicated to Associates and Serving Customers and Communities
  • 2014 Revolving Credit Facility and Senior Secured Notes due February 2019 to be Fully Refinanced
  • All Senior PIK Toggle Notes due September 2018 to Convert to Equity
  • Exit Financing Fully Committed
  • All General Unsecured Claims, Including Supplier Partners and Trade Creditors, to be Paid in Full in Ordinary Course

JACKSONVILLE, Fla. --Southeastern Grocers ("SEG" or "the Company") today announced that, as contemplated under its previously announced Restructuring Support Agreement ("RSA"), it has commenced voluntary cases under Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the District of Delaware to implement the pre-packaged plan of reorganization.

As SEG announced on March 15, 2018, SEG entered into an RSA with a group of creditors collectively holding 80% of its 8.625%/9.375% Senior PIK Toggle Notes due September 2018 and its private equity sponsor regarding the terms of a comprehensive financial restructuring that will position SEG for long-term financial health. SEG will continue operating throughout this process, and its associates remain focused on exceeding the needs of customers and consistently delivering great service, quality and value in SEG's stores.

Anthony Hucker, President and Chief Executive Officer of SEG, said, "Today, with the support of our key stakeholders, we are taking the next step in the implementation of our financial restructuring plan. This pre-packaged, court-supervised financial restructuring process provides for a clear and expedited path to put SEG in the best position to serve our communities and succeed in the competitive retail market in which we do business."

Mr. Hucker continued, "Our operations will continue to thrive throughout the seven states we serve with more than 580 stores operating under the BI-LO, Fresco y Más, Harveys Supermarket and Winn-Dixie banners. We are extremely pleased that this process continues to proceed quickly and as planned. With each key milestone reached, we move closer to emerging and making Southeastern Grocers into a true success story for our associates, our customers and the communities we serve."

As previously announced, the restructuring process is expected to significantly strengthen SEG's balance sheet. The restructuring will decrease overall debt levels by over $500 million and maintain the Company's strong liquidity position under the new post-emergence Revolving Credit Facility. The significant reduction in debt will result in reduced interest expense, allowing SEG to invest more cash flow back into the business in the form of increased capital expenditures for store remodels and new stores. With a deleveraged balance sheet and an optimal store base, SEG will be able to focus its resources on store growth and financial vitality.

Holders of general unsecured claims, including supplier partners, contract counterparties, and all other trade creditors will receive payment in full on account of existing obligations in the ordinary course of business. SEG has secured 100% committed exit financing in the form of a senior secured six-year term loan facility in the original principal amount of $525 million and an asset-based lending (ABL) revolving credit facility.

SEG has filed a number of customary motions seeking court authorization to continue to support its business operations during the court-supervised restructuring process, including the continued payment of associate wages and benefits without interruption. SEG expects to receive court approval for all of these requests.

Additional information about the Company's restructuring efforts is available at www.segrocers.com/restructuring. Court documents and additional information can be found at a website administrated by the Company's claims agent, Prime Clerk, at http://cases.primeclerk.com/SEG.

Advisors

Weil, Gotshal & Manges LLP is serving as legal counsel, Evercore is serving as investment banker, and FTI Consulting Inc. is serving as restructuring advisor to Southeastern Grocers.

About Southeastern Grocers
Southeastern Grocers, LLC, (SEG) parent company and home of BI-LO, Fresco y Más, Harveys Supermarket and Winn-Dixie grocery stores, is one of the largest conventional supermarket companies in the U.S. SEG grocery stores, liquor stores and in-store pharmacies serve communities throughout the seven southeastern states of Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina and South Carolina. BI-LO, Fresco y Más, Harveys Supermarket and Winn-Dixie are well-known and well-respected regional brands with deep heritages, strong neighborhood ties, proud histories of giving back, talented and caring associates and strong commitments to providing the best possible quality and value to customers. For more information, visit www.bi-lo.com, www.frescoymas.com, www.harveyssupermarkets.com and www.winndixie.com.

Tags: Retail & Sales

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