Sam Ash traced its history to 1924 and operated a multi-channel platform built around three lines: brick-and-mortar retail, a dedicated e-commerce channel, and a wholesale business run through Samson Technologies. At filing, the debtors reported 42 retail stores and roughly 830 employees, with the store base concentrated in Florida, California, Texas, and New York. Those operating details appear in the First Day Declaration.
Management attributed the distress to COVID-era disruption, a lasting consumer shift toward online purchasing, weak post-pandemic sales trends, and a disappointing 2023 holiday season. The First Day Declaration also described mounting liquidity pressure, rent defaults, landlord threats and litigation, and defaults under the company's asset-based lending facility with Tiger Finance, LLC. Contemporary coverage echoed the same drivers, describing Sam Ash as a century-old retailer undone by financial distress tied to the pandemic and the migration of instrument sales online.
The retail wind-down began before the petition. The debtors started a store-closing and inventory-monetization process at 18 underperforming stores on March 1, 2024, then expanded it to all remaining retail locations on May 2, 2024, days before filing. That sequence is described in the First Day Declaration, and the public announcement that the company would close all 42 stores framed the closures as part of an effort to reposition the business around its non-store assets.
The going-out-of-business program ran in parallel with the chapter 11 sale process. Tiger Group described the store closing sales conducted across the remaining locations, while A&G Real Estate Partners marketed the store leases as the footprint was wound down, including reporting that the company planned to auction two remaining New Jersey stores. The store liquidation was a distinct track from the court-approved sale, which targeted the e-commerce platform, intellectual property, and the Samson wholesale business rather than a going-concern transfer of the stores, as reflected in the Sale Order.
As of the petition date, the debtors owed Tiger Finance not less than approximately $18.2 million under the prepetition asset-based facility, plus accrued costs and fees, and described a prepetition over-advance position with less than $1 million of available cash. That liquidity profile, set out in the First Day Declaration, drove the request for immediate DIP financing tied to a fast sale timeline. Tiger Finance occupied an unusually central role in the case, serving simultaneously as prepetition ABL lender, DIP lender and cash-collateral counterparty, and stalking horse bidder, a structure detailed in the DIP Motion.
The debtors sought a DIP facility of up to $20 million, with interim borrowings up to $18.125 million and a roll-up of the prepetition ABL balance into the DIP upon entry of the Interim DIP Order. The credit agreement priced loans at a 9.0 percent applicable margin over Term SOFR or the prime rate, with a rate floor and an additional 3.0 percent default rate, and carried a $300,000 commitment fee paid at effectiveness plus a $300,000 exit fee that would be forgiven absent an event of default. Those terms are described in the DIP Motion.
The financing package imposed tight cash governance. It tied availability to a 13-week approved budget with weekly variance testing, sales and collections minimums, and disbursement caps, and gave Tiger adequate protection through replacement liens, superpriority claims, and related protections while preserving a challenge process for parties in interest to contest the prepetition debt and liens. Those budget and adequate-protection mechanics appear in the DIP Motion. The motion also embedded the sale milestones in the financing terms, including final DIP approval by early June, a June 14 bid deadline, a June 20 auction if needed, and a targeted summer closing.
The court entered the Interim DIP Order shortly after the petition date and the Final DIP Order on June 5, 2024, ratifying the facility on a final basis. Law360 reported that the court approved the $20 million DIP over a U.S. Trustee objection. The Final DIP Order confirmed the roll-up of prepetition obligations into the DIP while preserving challenge rights, required collections and proceeds to be remitted to the DIP lender and applied first to prepetition obligations, and formalized the budget controls that governed liquidity for the remainder of the sale timeline.
The sale motion framed the chapter 11 strategy as an expedited section 363 process meant to preserve optionality, conserve liquidity, and avoid a forced liquidation, with Tiger Finance or an affiliate serving as the baseline stalking horse bidder for substantially all assets. The motion's framing and stalking horse structure appear in the Bidding Procedures Motion. On June 5, 2024, the court entered the Bidding Procedures Order, approving the procedures, a $150,000 break-up fee with administrative-expense treatment, contract-assumption procedures, and an auction schedule that set a June 14 bid deadline, a June 20 auction if needed, and sale hearings on June 21 or June 28 depending on whether an auction occurred.
Contemporary coverage reported that the court approved the sale process with a baseline bid and that the assets were set for auction with a stalking horse bidder. The June 20 auction produced a $15.2 million winning bid from Organizacion Gonher S.A. de C.V., a Mexico-based distributor and manufacturer, after competitive bidding against the Tiger stalking horse.
The Sale Order, entered June 28, 2024, approved the asset purchase agreement with Gonher or its designee and documented $15.2 million of cash consideration subject to specified adjustments, a $1.52 million deposit, a $750,000 escrow amount funded at closing, and the assumption of specified liabilities and cure costs. The order found the consideration fair and reasonable and the purchaser a good-faith buyer entitled to free-and-clear transfer, and it approved assumption and assignment of the transferred contracts listed on the order exhibits. The cash consideration was subject to working-capital and paid-time-off adjustments, with the escrow arrangements addressing potential post-closing true-ups under the purchase agreement.
The transaction closed quickly after approval. Law360 reported that Sam Ash sought approval of Gonher as the winning bidder, the debtors filed a notice that the sale to Gonher closed on July 19, 2024, and Capstone Partners later reported it advised on the sale.
The sale process drew friction over bid protections, cure amounts, and contract assumption. The U.S. Trustee filed a limited objection to the bidding-procedures package, arguing that the proposed bid-protection payments had not been shown to satisfy the standards for administrative-expense treatment and should not be elevated automatically over other estate claims. Contract counterparties objected to cure and adequate-assurance treatment, including a landlord objection and an Oracle limited objection contesting proposed cure amounts and assumption mechanics. The court approved the procedures and later the sale over those objections.
The Sale Order required cure costs for assumed contracts to be paid in cash at closing and provided that cure payments would not reduce the purchase consideration, while contemplating designated contracts and disputed cure amounts that could generate post-closing disputes. One such dispute followed. Blue Yonder, Inc. filed a motion to compel the purchaser to pay post-closing expenses under a designated contract while cure amounts were contested, noting that the debtors had listed a cure amount of $9,003.84 against Blue Yonder's asserted $554,861.74, and seeking $155,180.66 accrued through October 31, 2024 plus roughly $1,492.12 per day thereafter.
A reclamation and administrative-expense dispute with Hoshino was resolved by stipulation. A December 12, 2024 Hoshino stipulation allowed a $71,317.58 administrative-expense claim under section 546(c), noted that a separate $98,734.38 claim under section 503(b)(9) had already been paid, and allowed the balance of Hoshino's asserted claim as a general unsecured claim of $196,878.19.
The debtors pivoted quickly from the sale to a liquidation plan, filing an initial plan and disclosure statement in late May 2024, amending it through June, and filing a second amended joint plan of liquidation on August 8, 2024. The court entered findings of fact, conclusions of law, and the Confirmation Order on August 15, 2024, approving the disclosure statement and confirming the plan. Media coverage noted the court approved the liquidation plan over a U.S. Trustee objection.
Class treatment followed a standard liquidation waterfall. Secured tax claims, other secured claims, and priority claims were unimpaired and rendered whole, while Class 4 general unsecured claims were impaired and entitled to a pro rata share of net distributable proceeds. Intercompany claims were impaired with no distribution, and subordinated claims and equity interests were cancelled with no recovery. Class 4 was the only class entitled to vote, and Classes 1 through 3 were deemed to accept as unimpaired. That structure is set out in the Second Amended Plan and the Confirmation Order.
The plan created a liquidating trust on the effective date to hold remaining assets, pursue retained causes of action, reconcile claims, and make distributions, with the liquidating trustee selected jointly by the debtors and the creditors' committee and granted exclusive authority to object to and settle claims after the effective date. The plan also established a professional fee reserve, a claims reserve, and a wind-down and expense reserve. The plan supplement and liquidating trust agreement provided that trust assets vested automatically on the effective date for the benefit of allowed Class 4 creditors, that the trust existed purely for liquidation, and that trustee compensation was capped at $20,000 per month plus 6% of gross proceeds collected from retained causes of action, with court approval still required for larger settlements and claim allowances above stated thresholds.
The Confirmation Order approved the trust agreement and the plan's releases, settlements, exculpations, and injunctions, with the exculpation carving out actual fraud, willful misconduct, and gross negligence. The plan became effective on August 30, 2024, as reported in a post-confirmation report that marked the start of administrative-claim payments.
Claims reconciliation became the dominant activity once the sale closed and the plan went effective. A post-confirmation report for the quarter ended March 31, 2025 reflected cumulative administrative payments and zero distributions to general unsecured creditors as of that period. By early 2026, the trustee had moved further down the waterfall: a motion to extend deadlines stated that the liquidating trustee had already made an initial 9% distribution to creditors with allowed claims and sought additional time to reconcile claims and evaluate causes of action. The court granted that relief on March 6, 2026, entering an order extending the claims-objection deadline to August 31, 2026 and the case-closing deadline to November 30, 2026.
The register carried a heavy volume of filings. The trustee reported that 4,243 proofs of claim had been filed and pursued omnibus objections to clear duplicates. The Fourth Omnibus Objection, filed February 6, 2026, sought to disallow and expunge claims that duplicated other claims filed by the same creditors in the same amounts, and the court entered a supplemental order on April 15, 2026 expunging each scheduled duplicate while leaving the surviving claims allowed.
Professional retentions. The debtors retained Cole Schotz as bankruptcy counsel, Capstone Capital Markets as investment banker, A&G Realty Partners as real estate consultant, and SierraConstellation Partners for CRO and financial-advisory services, retentions reflected in the Cole Schotz, Capstone, A&G, and SierraConstellation retention orders. The creditors' committee retained Emerald Capital Advisors as financial advisor, whose final fee application sought $400,565.00 in compensation and $1,157.93 in expenses for work from May 24 through August 30, 2024. Emerald Capital Advisors later served as liquidating trustee carrying out the claims reconciliation and distributions.
The timeline below follows the major dates reflected in the First Day Declaration, Sale Order, Confirmation Order, and the deadline-extension order that reset the 2026 case-closing schedule.
| Date | Event |
|---|
| March 1, 2024 | Prepetition store-closing process started at 18 underperforming stores |
| May 2, 2024 | Closing process expanded to all 42 stores |
| May 8, 2024 | Chapter 11 petitions filed; First Day Declaration and DIP Motion filed |
| May 10, 2024 | Interim DIP Order entered |
| June 5, 2024 | Final DIP Order and Bidding Procedures Order entered |
| June 20, 2024 | Auction produced the $15.2 million Gonher bid |
| June 28, 2024 | Sale Order entered approving the Gonher transaction |
| July 19, 2024 | Sale to Gonher closed |
| August 8, 2024 | Second Amended Plan filed |
| August 15, 2024 | Confirmation Order entered |
| August 30, 2024 | Plan effective date |
| March 6, 2026 | Court extended claims-objection deadline to August 31, 2026 and case-closing deadline to November 30, 2026 |
| April 15, 2026 | Supplemental order expunged duplicate claims under the Fourth Omnibus Objection |
When did Sam Ash file chapter 11?
Sam Ash Music Corporation and its affiliates filed chapter 11 petitions on May 8, 2024 in the District of New Jersey, lead case 24-14727. The company filed for bankruptcy protection days after announcing it would close all stores.
Why did Sam Ash file for bankruptcy?
Management attributed the distress to COVID-era disruption, a lasting shift to online purchasing, weak post-pandemic sales, and a disappointing 2023 holiday season, compounded by rent defaults and defaults under the Tiger Finance ABL facility. Those causes are described in the First Day Declaration.
Who provided the DIP financing and what were the key terms?
Tiger Finance, LLC served as prepetition lender, DIP lender, and stalking horse bidder, and provided a facility of up to $20 million that rolled up roughly $18.2 million of prepetition ABL debt. Pricing ran at a 9.0 percent margin over Term SOFR or prime, with $300,000 commitment and exit fees, as described in the DIP Motion.
What assets were sold and who bought them?
The Sale Order approved a sale of the e-commerce operations, intellectual property, and the Samson Technologies wholesale business to Organizacion Gonher S.A. de C.V. for $15.2 million in cash plus assumed liabilities and cure costs. The retail stores were not transferred as a going concern; they were liquidated through store-closing sales.
What did the plan provide for unsecured creditors?
Class 4 general unsecured claims were impaired and entitled to a pro rata share of net distributable proceeds from the liquidating trust, while subordinated claims and equity interests were cancelled with no recovery. The class treatment is described in the Second Amended Plan.
What is the current status of distributions?
The liquidating trustee made an initial 9% distribution to holders of allowed claims, reported in a motion to extend deadlines that pushed the claims-objection deadline to August 31, 2026 and the case-closing deadline to November 30, 2026. Claims reconciliation, including omnibus objections to duplicate filings, remained active into 2026.
Who is the claims agent for Sam Ash Music Corporation?
Epiq serves as the claims and noticing agent and maintains the official claims register for the case, against which more than 4,200 proofs of claim were filed.
Read more chapter 11 retail liquidation coverage on the ElevenFlo blog.
