$60.8 million total ($35.5 million new money; $25.3 million FILO roll-up)
Case Snapshot
Chapter 11 Wind-Down and Liquidation Strategy
Filing posture and objectives. The debtors entered chapter 11 to execute a going-out-of-business strategy and monetize assets through inventory liquidation, lease sales, and real estate dispositions. The First Day Declaration stated the filing was designed to facilitate a wind-down and a value-maximizing sale of real estate and other assets while store closing sales continued across the chain. The press release announcing the filing emphasized store closing sales at all locations and a targeted process to sell leases and owned properties. Bloomberg and NPR reported that liquidation sales began across the entire fleet as the company pursued a full shutdown rather than a reorganization. Bloomberg described going-out-of-business sales beginning at all stores, and NPR noted the immediate start of liquidation sales following the closure announcement.
Debtor-in-possession financing. The debtors obtained a DIP package sized to fund a liquidation process rather than a long operating turnaround. The company stated that the facility totaled about $60.8 million, including $35.5 million in new-money term loans. The DIP Motion describes the facility as a multi-draw term loan with a $25.3 million roll-up of prepetition FILO debt, priced at SOFR plus 7.50% with a 1.00% SOFR floor and a 2.00% commitment fee and 2.00% exit fee. The initial draw was $20.5 million at the Interim DIP Order, with a $15.0 million final draw after final approval. Court filings also describe a minimum cash balance covenant of $15 million through May 31, 2024 and $10 million thereafter, with a rolling 13-week budget updated biweekly.
DIP Term
Detail
Total facility
$60.8 million (with $35.5 million of new money)
Structure
Multi-draw DIP term loan with $25.3 million FILO roll-up
Initial draw
$20.5 million (interim order)
Final draw
$15.0 million (after final order)
Pricing
SOFR + 7.50% with 1.00% floor (per court filings)
Fees
2.00% commitment fee and 2.00% exit fee (per court filings)
Liquidity covenant
Minimum cash balance of $15 million through May 31, 2024; $10 million thereafter (per court filings)
Bidding procedures and auction calendar. Court filings set a structured sale calendar tied to the DIP milestones. The Bidding Procedures Motion established late-April deadlines for indications of interest and objections, followed by a mid-May bid deadline and a late-May auction and sale hearing. These deadlines framed the lease and asset sales that later transferred large blocks of stores to other discount retailers.
Milestone
Date (per court filings)
Indication of interest deadline
April 29, 2024 at 4:00 p.m. ET
Bid procedures objection deadline
April 30, 2024 at 4:00 p.m. ET
Sale objection deadline
May 14, 2024 at 4:00 p.m. ET
Bid deadline
May 15, 2024 at 4:00 p.m. ET
Auction
May 21, 2024 at 10:00 a.m. ET
Auction objection deadline
May 22, 2024 at 4:00 p.m. ET
Sale hearing
May 23, 2024 at 10:00 a.m. ET
Major asset and lease transactions. The most visible outcomes were the transfers of store leases and selected assets to other retailers. Dollar Tree announced it had acquired designation rights for 170 leases across Arizona, California, Nevada, and Texas, along with the North American intellectual property for 99 Cents Only Stores and certain fixtures and equipment. The court approved the transfer in the Designation Rights Sale Order. CNN reported that the company planned to rebrand and reopen the sites as Dollar Tree stores. In a separate transaction, Ollie's Bargain Outlet and its affiliate OBO Ventures won approval for a $14.6 million purchase of 11 Texas locations, an acquisition that Retail Dive described as a stalking horse sale approved by the court. The Ollie's Sale Order included findings that the sale was in good faith and free and clear of liens under section 363(f).
Plan confirmation and creditor treatment. The debtors filed a Joint Chapter 11 Plan and Disclosure Statement on November 27, 2024. The plan was confirmed on January 24, 2025 and became effective on January 31, 2025, as reflected in the Notice of Effective Date filed in the case and on the claims agent case site. Court filings show the plan is liquidating in nature and provides for a liquidating trust, with META Advisors LLC named as liquidating trustee. The Confirmation Order also approved debtor releases, consensual third-party releases, and exculpation provisions that exclude fraud, gross negligence, or willful misconduct.
Class
Description
Status and voting (per court filings)
1
Other priority claims
Unimpaired
2
Other secured claims
Unimpaired
3
Prepetition ABL claims
Unimpaired
4
Senior notes claims
Impaired; accepted 100% by amount and number
5
General unsecured claims
Impaired; accepted 83.88% by amount and 91.16% by number
6
Intercompany claims
Impaired; deemed to reject
7
Intercompany interests
Impaired; deemed to reject
8
Equity interests
Impaired; deemed to reject
Claims administration and bar dates. Kroll Restructuring Administration LLC was appointed claims and noticing agent, and the company's case site has served as the public portal for notices and claim filings. The Notice of Effective Date set March 3, 2025 as the deadline for most administrative claims that accrued from June 1, 2024 through the effective date, excluding fee claims and certain settlement-related fees. The same notice provides that executory contracts and unexpired leases not assumed or rejected before confirmation were deemed rejected as of the effective date.
Lease rejection and assumption framework. The liquidation required a fast process to assume and assign valuable leases while rejecting the remainder. The Lease Rejection Procedures Motion and related court orders approved streamlined procedures for rejecting leases and executory contracts and for assuming and assigning selected leases to buyers. That framework supported the bulk transfer of lease rights to purchasers like Dollar Tree and Ollie's while allowing the debtors to reject nonperforming locations on an expedited schedule, a common dynamic in retail liquidations where real estate value is the primary asset class.
Business Overview and Footprint
Core business and formats. 99 Cents Only Stores operated as an extreme value retailer with a core proposition built around fixed or sub-dollar price points, supported by a mix of consumables, seasonal items, and general merchandise. The First Day Declaration describes the chain as operating under the 99 Cents Only Stores and The 99 Store brands and maintaining a Bargain Wholesale division that supplied third-party retail customers. The company reported an average store size of about 20,000 square feet and five distribution centers that served the store network.
Store footprint. Court filings list 371 stores spread across four states, with the largest concentration in California. The store base and distribution network were concentrated in the western U.S., making the company more exposed to West Coast labor and occupancy costs than most national dollar store peers.
State
Stores (per court filings)
California
265
Texas
46
Arizona
39
Nevada
21
Total
371
Founding and growth. The chain traces its origins to a single store opened on August 13, 1982 in Inglewood, California. It became a distinctive regional brand by using a fixed price point and emphasizing value in a mix of grocery, household, and seasonal categories. The company later went public in 1996 and remained a well-known Southern California retailer for decades. Fortune described the closure decision as ending a 42-year run for the brand.
Brand positioning. The chain's identity was closely tied to its 99-cent price point and a treasure-hunt assortment that mixed staples with opportunistic closeouts. Wikipedia describes the company as a fixed-price retailer that grew into a regional staple, particularly in Southern California, where the brand name itself became shorthand for extreme-value shopping. That positioning made pricing changes more visible to customers, and the shift away from sub-$1 items in later years disrupted a core element of the brand promise.
Year
Milestone
1982
First store opened in Inglewood, California
1996
IPO on the New York Stock Exchange
2012
Taken private by Ares Management and CPPIB
2024
Full chain closure announced and chapter 11 filing
Ownership History and Prepetition Capital Structure
2012 take-private transaction. 99 Cents Only Stores was acquired in 2012 by Ares Management and the Canada Pension Plan Investment Board at $22.00 per share, valuing the equity at approximately $1.6 billion. The transaction ended the company's public listing and left the Gold/Schiffer family with a significant minority stake, while founder David Gold continued as chairman emeritus. The capital structure at filing reflected years of leveraged ownership and a retail model increasingly constrained by inflation and margin pressures.
Funded debt at the petition date. The First Day Declaration lists about $456.9 million of funded debt, split across secured asset-based lending, FILO debt, and $350 million of senior notes. The funded debt profile was large relative to the liquidation value of an inventory-heavy, lease-based retailer, especially once store closures were announced. The combination of secured borrowing and senior notes limited flexibility in a liquidation and drove the need for a tightly controlled DIP budget.
Facility
Amount (per court filings)
2026 senior notes
$350.0 million
ABL revolver
$38.2 million
FILO term loan
$25.0 million
Letters of credit
$25.732858 million
PropCo promissory note
$18.0 million
Total funded debt
$456.932858 million
Collateral structure. The DIP Motion describes a split-lien structure in which the ABL lenders held first-priority liens on current assets and second-priority liens on certain fixed assets and equity interests. The senior notes held the inverse priority, with first liens on notes-priority collateral and second liens on ABL-priority collateral. This structure shaped the DIP negotiations and the eventual liquidation waterfall, particularly as inventory and lease proceeds were monetized.
Pricing model breakdown. Bankruptcy filings state that sub-$1 items fell below 50% of the product assortment by 2023, undermining the brand's core value proposition. The company faced resistance to price increases, leaving little room to offset inflation in freight, labor, and product costs. When a fixed price promise becomes difficult to sustain, the margin compression can be immediate, particularly in categories like grocery and consumables where price elasticity is high.
Cost structure and labor pressures. Court filings cite California minimum wage increases as a material driver of higher labor costs. With 265 of 371 stores in California, the chain's wage exposure was higher than peers with broader geographic footprints. At the same time, retail theft and shrink rose, reducing gross profit and forcing a higher level of loss prevention expense relative to revenue.
Transformation efforts and liquidity stress. Bankruptcy filings describe a 2023 transformation plan that included store upgrades, leadership changes, real estate streamlining, and workforce reductions. The plan did not restore liquidity, and by early 2024 the debtors faced vendor cash-on-delivery demands and landlord pay-or-quit notices. The board decided on April 4, 2024 to close all stores and pursue a DIP-backed wind-down. Fortune reported that S&P Global had expected the company to remain cash-flow negative for an extended period.
Industry context for extreme value retail. A Marketplace analysis of the discount sector described how inflation and higher wholesale costs put fixed-price models under pressure, forcing retailers to choose between raising prices or absorbing margin erosion. The report framed discount retail as an industry where small changes in unit economics can produce large cash flow swings, particularly for chains that depend on high-volume, low-margin sales and operate with heavy rent and labor costs. Those conditions align with court filings that show 99 Cents Only Stores shifting away from sub-$1 pricing while still carrying a California-heavy footprint. The chain's liquidation thus fits into a broader pattern of discount retailers trying to rebalance pricing and cost structures during a period of persistent inflation and elevated shrink. Marketplace characterized these pressures as widespread in the sector.
Court filings cite California wage increases as a material cost driver
Pricing model erosion
Filings report sub-$1 items below 50% of assortment by 2023
Liquidity deterioration
Vendor COD demands and landlord pay-or-quit notices in early 2024
Real Estate, Inventory, and Store Closure Execution
Real estate portfolio marketing. The liquidation strategy centered on monetizing a large lease and property portfolio. The company announced marketing of 377 real estate assets consisting of 333 leased locations and 44 owned properties. CoStar reported that the company began marketing leases for bankruptcy sale, highlighting the importance of the lease portfolio to the liquidation outcome. The process used Hilco Real Estate in collaboration with Jefferies to market the properties.
Inventory and real estate proceeds. Hilco Global's case study reported $245 million of retail inventory monetized and $168.5 million of real estate proceeds from 44 owned properties, with more than 200 leases sold within 75 days. Those figures, if realized across the portfolio, indicated substantial liquidity relative to the company's size and supported the liquidating plan's structure.
Dollar Tree designation rights. Dollar Tree completed a transaction for designation rights to 170 leases, along with the North American intellectual property and select fixtures and equipment. CNN reported the company planned to rebrand and reopen many of the sites as Dollar Tree locations, creating one of the largest single-buyer lease transfers in a recent retail liquidation.
Ollie's Texas acquisition. Ollie's Bargain Outlet announced it was the winning bidder in the bankruptcy auction for 11 Texas locations at a $14.6 million purchase price. Retail Dive noted that the transaction involved a mix of three owned properties and eight leased sites, and that the court approved the deal as part of the liquidation process.
Texas footprint changes. Local coverage in Texas reported that Dollar Tree paid more than $1.3 million to assume leases and that Dollar Tree and Ollie's together would control 18 former 99 Cents Only locations in the state. The regional concentration of the assets highlights how lease and real estate values were monetized market by market rather than through a single buyer for the full chain.
Liquidation outcome
Source
377 total real estate assets marketed (333 leases, 44 owned)
Professional advisors. The filing announcement listed a standard retail liquidation advisory stack. The debtors named Milbank LLP as legal counsel, Jefferies LLC as investment banker, and Alvarez & Marsal as restructuring advisor. The same announcement identified Hilco Global as liquidation support, while the real estate marketing process was run by Hilco Real Estate in collaboration with Jefferies. This structure reflects the operational intensity of a full-chain liquidation, where inventory disposition, lease transfers, and real estate sales need to proceed on parallel tracks.
CRO and liquidation execution. Hilco Global's case study reports that Chris Wells of Alvarez & Marsal was appointed chief restructuring officer and that Hilco monetized inventory and real estate proceeds during the wind-down. The CRO role is typical in large retail liquidations, providing centralized oversight of store-closing operations, vendor negotiations, and the implementation of the DIP budget and sale milestones.
Claims administration. Kroll Restructuring Administration LLC was appointed as claims and noticing agent and maintains the case site at cases.ra.kroll.com/99only. The claims agent handles notice distribution, claims intake, and the official claims register, which is essential for a case involving tens of thousands of potential claimants and lease counterparties.
Role
Advisor or firm
Debtors' counsel
Milbank LLP
Investment banker
Jefferies LLC
Restructuring advisor
Alvarez & Marsal
CRO
Chris Wells (Alvarez & Marsal)
Liquidation support
Hilco Global
Real estate advisor
Hilco Real Estate (with Jefferies)
Claims agent
Kroll Restructuring Administration LLC
Key Case Timeline
The case moved quickly from a public closure announcement to a court-supervised liquidation, with key milestones compressed into the first eight months. The timeline below combines public announcements, court milestones, and sale transactions to show how the wind-down progressed from April 2024 through the plan effective date.
Date
Event
August 13, 1982
First store opened in Inglewood, California source
January 2012
Ares Management and CPPIB completed the take-private transaction source
April 5, 2024
Closure of all stores announced; liquidation sales begin source
Bidding procedures and sale motion filed (court filings)
May 23-24, 2024
Sale orders entered for Dollar Tree and Ollie's transactions (court filings)
May 29, 2024
Dollar Tree completed the 170-lease transaction
The liquidation milestones show how rapidly the company moved from announcement to asset sales. The most complex work occurred in April and May 2024, when the debtors obtained DIP financing, launched the auction process, and executed the two most material lease transactions. The plan confirmation timeline in late 2024 and early 2025 reflects the time required to reconcile claims, document the liquidating trust, and finalize distributions after the core asset sales were complete.
Workforce and Stakeholder Impact
Employee impact. Bankruptcy filings list approximately 10,874 employees at the petition date, while Fortune reported that about 14,000 workers were expected to lose jobs as the stores closed. The difference likely reflects seasonal or part-time headcount and the timing of the measurement, but both figures point to a large workforce affected by the liquidation.
Liquidation cadence and store-level execution. Liquidation sales began on April 5, 2024, the same day the closure decision was announced, and continued through early June as the fleet closed. NPR reported the immediate start of liquidation sales, while Hilco Global later reported $245 million of inventory monetized during the wind-down. That result implies a rapid sell-through campaign that required coordinated markdowns, merchandise transfers, and store-level staffing as locations closed on a rolling basis.
Community footprint. The chain's footprint was concentrated in the western U.S., with heavy exposure to California and Texas. NPR noted that stores were spread across California, Arizona, Nevada, and Texas, and liquidation sales began immediately after the April 5 announcement. Wikipedia reports that all stores closed between April 5 and June 3, 2024, compressing the shutdown into a roughly two-month window.
Stakeholder dynamics. The plan structure shows how a liquidation case channels value to creditor classes rather than equity. The Confirmation Order indicates that secured claims and priority claims were left unimpaired, while senior notes and general unsecured claims were impaired but voting in favor. Equity interests were impaired and deemed to reject. The plan's liquidating trust structure suggests that proceeds from inventory, lease transfers, and real estate sales will be distributed as claims are reconciled over time.
Frequently Asked Questions
What is 99 Cents Only Stores and where did it operate'
99 Cents Only Stores was an extreme value retailer founded in Inglewood, California, with its first store opening in 1982. At the time of its chapter 11 filing, the chain operated 371 stores across California, Arizona, Nevada, and Texas.
When did the company file chapter 11 and where'
Number Holdings, Inc. and affiliated debtors filed chapter 11 on April 7, 2024 in the U.S. Bankruptcy Court for the District of Delaware.
Court filings list approximately $456.9 million of funded debt, including $350 million of senior notes, $38.2 million in ABL borrowings, $25 million of FILO debt, $25.7 million in letters of credit, and an $18 million PropCo promissory note.
What DIP financing did the debtors obtain'
The company announced a $60.8 million DIP facility with $35.5 million of new money. Court filings describe a multi-draw term loan with a $25.3 million FILO roll-up, priced at SOFR plus 7.50% with a 1.00% floor.
Court filings show the plan created a liquidating trust to administer remaining assets and distributions, with META Advisors LLC serving as liquidating trustee.
Who is the claims agent for 99 Cents Only Stores'
Kroll Restructuring Administration LLC serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.
close all 371 stores https://www.npr.org/2024/04/05/1243072754/99-cent-stores-close-california-arizona
assets of $1 billion to $10 billion https://www.bloomberg.com/news/articles/2024-04-08/99-cents-only-stores-goes-bankrupt-as-inflation-keeps-biting
a $60.8 million DIP facility https://www.prnewswire.com/news-releases/99-cents-only-stores-files-for-voluntary-chapter-11-protection-to-facilitate-wind-down-of-business-operations-and-pursue-value-maximizing-sale-of-its-real-estate-and-other-assets-302110101.html
confirmed the liquidating plan on January 24, 2025 https://www.law360.com/bankruptcy-authority/articles/2288520/discount-retailer-99-cents-confirms-ch-11-wind-down-plan
January 31, 2025 as the effective date https://cases.ra.kroll.com/99only/
acquired designation rights for 170 leases https://corporate.dollartree.com/news-media/press-releases/detail/267/dollar-tree-inc-completes-transaction-for-170-99-cents
rebrand and reopen the sites as Dollar Tree stores https://www.cnn.com/2024/05/29/business/dollar-tree-99-cents-only
a $14.6 million purchase https://www.globenewswire.com/news-release/2024/05/24/2887926/36273/en/Ollie-s-Bargain-Outlet-Winning-Bidder-in-Bankruptcy-Auction-to-Acquire-Eleven-Former-99-Cents-Only-Stores.html
August 13, 1982 in Inglewood, California https://en.wikipedia.org/wiki/99_Cents_Only_Stores
42-year run https://fortune.com/2024/04/05/99-cents-only-stores-closing-down-inflation-theft-shrink/
Ares Management and the Canada Pension Plan Investment Board https://www.prnewswire.com/news-releases/ares-management-canada-pension-plan-investment-board-and-goldschiffer-family-complete-acquisition-of-99-cent-only-stores-137289753.html
377 real estate assets https://www.nasdaq.com/press-release/99-cents-only-stores-announce-bankruptcy-sale-of-377-property-portfolio-through-hilco
marketing leases for bankruptcy sale https://www.costar.com/article/36198118/99-cents-only-files-for-chapter-11-begins-marketing-leases
more than $1.3 million to assume leases https://www.dallasnews.com/business/retail/2024/05/10/ollies-bargain-outlet-and-dollar-tree-buy-texas-99-cents-only-stores/
Hilco Global case study https://hilcoglobal.com/case-studies/99-cents-only-stores/
This article was researched and written with AI assistance, using court filings, public records, and news sources. AI-generated content can contain errors. Verify all information against primary sources before relying on it. This is not legal or financial advice. See the disclaimer.