January 15, 2009 / 10:16 PM / 10 years ago

UPDATE 1-Court approves Gottschalks first-day motions

NEW YORK, Jan 15 (Reuters) - Regional department store chain Gottschalks Inc GOTT.PK said it got bankruptcy court approval on Thursday to access credit and honor gift cards as well as to pay employees and vendors for goods and services received after its bankruptcy filing.

The company said all of its so-called first day motions, submitted on Thursday, were granted by the U.S. Bankruptcy Court for the District of Delaware.

Gottschalks said it received approval for a $125 million debtor-in-possession (DIP) revolving credit facility to supplement its working capital and provide additional liquidity as it seeks to reorganize.

The company also received approval to make wage and salary payments, continue employee benefits, and to honor customer returns, exchanges and gift cards.

“These approvals will ensure that we are able to operate on a normalized basis as we pursue options to create value for stakeholders, including a potential sale of the business,” said Jim Famalette, chief executive of Gottschalks, which runs 58 department stores and three specialty apparel stores in the western United States. (Reporting by Martinne Geller)

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