The case ran on cash collateral rather than new DIP financing after prepetition agent PNC Bank tightened borrowing-base availability and exercised cash dominion over daily receipts. A wholesaler supplying roughly 4,500 independent storefronts, True Value used the chapter 11 case to transfer its distribution platform to a rival operator and wind down the remaining estate through a third amended liquidation plan administered by Michael I. Goldberg as plan administrator.
True Value Company, L.L.C. (and affiliated debtors)
Court
U.S. Bankruptcy Court, District of Delaware
Case Number
24-12337
Judge
Hon. Karen B. Owens
Petition Date
October 14, 2024
Confirmation Date
April 17, 2025
Effective Date
April 25, 2025
Employees
~1,950
Primary Business
Hardware and home improvement wholesaler/distributor
Sale Transaction
363 sale to Do it Best Corp. for $153 million cash plus assumed liabilities
Plan Type
Liquidation plan with litigation trust distributions
503(b)(9) Bar Date
November 27, 2024
General Bar Date
December 5, 2024
Governmental Bar Date
April 14, 2025
Case Snapshot
Plan Path and Liquidation Structure
The chapter 11 strategy centered on a court-supervised 363 sale followed by a liquidation plan. The debtors filed the sale motion on the petition date and sought authority to use cash collateral, framing the case around a going-concern transfer that preserved vendor and retailer relationships. The court entered a sale order on November 13, 2024, and the debtors then pivoted to a plan process.
The initial plan and disclosure statement were filed in January 2025, amended in February, and superseded by a third amended plan on March 31, 2025. The plan is a liquidation framework: it allocates remaining value through reserves and a litigation trust and assigns different treatment to secured, priority, and unsecured constituencies. The confirmation order was entered April 17, 2025 and the plan became effective April 25, 2025, at which point a plan administrator took over the wind-down.
Plan treatment overview. The third amended plan classifies claims into secured, priority, unsecured, and equity classes and provides for pro rata distributions from litigation trust recoveries where applicable. Prepetition lender claims and general unsecured claims are impaired, while priority and other secured claims are unimpaired and paid in full in cash or otherwise treated as unimpaired. Intercompany claims and interests are resolved at the debtors' discretion, and subordinated claims and existing equity interests are canceled with no distribution.
Class
Status
Treatment summary
Class 1 - Other Priority Claims
Unimpaired
Paid in full in cash after the Effective Date or when allowed
Class 2 - Other Secured Claims
Unimpaired
Paid in full in cash, return of collateral, or other unimpaired treatment
Class 3 - Prepetition Lender Claims
Impaired
Distributions under plan settlement plus litigation trust interests
Class 4 - General Unsecured Claims
Impaired
Pro rata litigation trust GUC interests
Class 5 - Intercompany Claims
Debtors' discretion
Reinstated, canceled, or otherwise resolved
Class 6 - Intercompany Interests
Debtors' discretion
Reinstated, canceled, or otherwise resolved
Class 7 - Subordinated Claims
Impaired
Canceled with no distribution
Class 8 - Existing Interests
Impaired
Canceled with no distribution
Wholesale Platform and Independent Store Network
True Value operates as a hardware retailer and wholesaler whose business model is built around supplying independent hardware stores. The first day declaration describes a national distribution platform with approximately 75,000 products sourced from more than 2,000 suppliers and delivered to roughly 4,500 retail storefronts. The network includes core, strategic, e-commerce, international, secondary, and specialty accounts, with most sales tied to True Value-branded retailers.
The company reported 12 leased distribution centers and a paint manufacturing plant in Cary, Illinois. Net-lease REIT W. P. Carey disclosed True Value's chapter 11 filing in its third-quarter 2024 results, identifying True Value as a tenant. As of the petition date, it employed about 1,950 workers, including unionized employees represented by Teamsters locals. Court filings also indicated that member stores are independently owned and not part of the chapter 11 cases, except for one company-owned location in Palatine, Illinois. The filing emphasized that the wholesale platform would continue to serve retailer demand during the sale process, with the goal of maintaining supply continuity for independently owned stores.
Local coverage described True Value as a Chicago-based company with a long operating history, and other reporting called it a hardware chain that would pursue a court-supervised sale. Those reports align with the debtors' characterization of the business as a supply-chain platform rather than a traditional big-box retailer, with stores owned by local operators that rely on True Value for inventory and branded programs.
Demand Normalization and Lender Cash Dominion
Management attributed the filing to a combination of post-pandemic demand normalization, supply chain disruptions, and a tightening of lender controls. The first day declaration and disclosure statement stated that sales fell below pre-pandemic levels after a period of elevated demand and that the company faced cost pressures related to inventory availability and fulfillment. Those conditions fed into a liquidity squeeze at a time when the company relied on asset-based borrowing to fund seasonal working capital needs. Law360 reported at filing that the company had been squeezed by the economy and lender tightening, a characterization that aligned with management's own account.
The first day declaration described a shift in lender posture that materially constrained cash availability. The prepetition lenders tightened borrowing base availability and exercised cash dominion, sweeping daily cash receipts and requiring lender consent for disbursements. The combination of lower sales and restricted liquidity reduced working capital and limited operational flexibility, prompting the company to pursue a going-concern sale rather than an extended stand-alone restructuring.
Capital Structure and PNC Cash Collateral
True Value entered chapter 11 with a secured credit facility that included a term loan and an asset-based revolving facility. The facility was secured by substantially all assets, and PNC Bank served as administrative agent, as detailed in the cash collateral motion and the first day declaration. The debtors also had letter of credit exposure and a secured commercial card program. The debt stack and collateral package shaped the restructuring, which relied on cash collateral rather than new DIP financing.
Obligation
Amount
Notes
Secured credit facility
Approx. $238.2 million funded
Includes term loan and ABL revolver secured by substantially all assets
Term loan
$18.75 million outstanding
Part of prepetition credit facility
ABL revolver
Up to $300 million (borrowing base)
Commitments reduced to $300 million in September 2024
Letters of credit
$11.31 million outstanding
Issued under the credit facility
PNC commercial card program
Up to $25 million
Secured by first-priority lien on collateral
The interim cash collateral order approved an eight-week budget with weekly variance reporting and provided a carve-out for statutory fees and professional fees. Adequate protection included replacement liens and superpriority claims to the extent of diminution in value. The final cash collateral order approved a negotiated term sheet that included reporting covenants and a condition tied to the asset purchase agreement, under which the buyer agreed to provide up to an additional $10 million to ensure lender recoveries reached a specified threshold. The negotiated resolution funded the chapter 11 case and moved up the sale after days of lender talks, averting a liquidation.
The cash collateral structure influenced the pace of the sale process and the plan timeline. Interest payments accrued at non-default rates, and the debtors' operating budgets were tied to a court-approved framework that required periodic reporting. The lender protections in the cash collateral orders also shaped plan negotiations, including the settlement structure embedded in the third amended plan for prepetition lender claims.
363 Sale to Do it Best
The sale process was structured around a stalking horse agreement with Do it Best Corp., a competitor in the hardware distribution market. The sale motion described the transaction as a going-concern transfer intended to preserve the wholesale platform and protect retailer supply chains. The company publicly announced a sale agreement with a purchase price of $153 million, and coverage of the filing highlighted the plan to sell the business to a rival through chapter 11. The debtors retained Skadden, Arps, Slate, Meagher & Flom as lead counsel and Houlihan Lokey as investment banker and financial advisor.
Local reporting noted that the sale needed to generate at least about $163 million to satisfy prepetition lender recovery thresholds, and the sale order incorporated a condition under which the buyer would contribute additional funds to meet that benchmark. Secured lenders holding roughly $238.2 million in claims objected that the stalking-horse sale undervalued the business, alleging a shortfall of more than $100 million on their claims before a court-approved resolution cleared the path to confirmation. A later bankruptcy deal cleared the path for the transaction, and press coverage described the sale as a transfer to a rival operator. As the sale progressed, vendors including Black & Decker filed reclamation notices seeking the return of goods shipped before the petition, with Black & Decker alone claiming at least $4.36 million in inventory received by the debtors.
The sale agreement contemplated a cash purchase price, assumed liabilities, and a cap on assumed payables. The stalking horse bidder posted a deposit that was applied to the purchase price at closing. Bid protections included a break-up fee and expense reimbursement, and the sale order found the buyer to be a good-faith purchaser under section 363(m). The order authorized transfer of substantially all assets free and clear of liens, claims, and interests, subject to a cure process for assumed executory contracts and unexpired leases.
Sale Term
Detail
Buyer
Do it Best Corp.
Purchase price
$153 million cash plus assumed liabilities
Assumed payables
Capped at $45 million
Deposit
$15.3 million applied to purchase price at closing
Bid protections
Break-up fee and expense reimbursement as superpriority administrative expense
Sale order
Entered November 13, 2024; good-faith purchaser finding
The structure allowed the debtors to complete the sale while leaving behind legacy liabilities and claims for resolution under the plan. Contract assumption and assignment procedures were embedded in the bid protections order and sale order. After closing, the court approved procedures for True Value to reject leases and contracts it did not assign to the buyer. The plan addressed the distribution of remaining value after the sale closed and the reconciliation of post-sale claims.
Confirmation, Bar Dates, and the Goldberg Wind-Down
The confirmation order was entered April 17, 2025, and the plan went effective April 25, 2025. Law360 reported that a Delaware bankruptcy judge approved the post-sale plan following the $153 million asset sale. The Notice of Effective Date also set post-confirmation deadlines for administrative claims and professional fees, and it established a post-confirmation rejection damages bar date. Following effectiveness, the plan administrator assumed responsibility for claim reconciliation, litigation trust administration, and plan implementation.
Michael I. Goldberg was named as the plan administrator. The plan administrator's role includes overseeing distributions, administering reserves, and pursuing litigation trust recoveries for the benefit of creditor constituencies. Court filings after confirmation show the plan administrator continuing to handle claim objections and claim reconciliation under the confirmed plan framework. Separately, the debtors moved to appoint an authorized representative for retiree benefits under section 1114, naming James P. Carroll to administer vested and unvested retiree obligations, and the confirmed plan embedded a related retiree settlement and trust. The wind-down also closed True Value's south Kansas City distribution center in April 2025, eliminating roughly 50 jobs with terminations beginning April 8, 2025.
Bar date procedures were established early in the case. The bar date order set a November 27, 2024 deadline for section 503(b)(9) claims, a December 5, 2024 general bar date for non-governmental prepetition claims, and an April 14, 2025 governmental bar date for public entities. Post-confirmation deadlines followed: a May 25, 2025 administrative claims bar date, a May 28, 2025 rejection damages bar date, and a June 9, 2025 professional fee claims bar date. The claims agent managed notice and receipt of claims.
The bar date order also established a notice package, a publication notice requirement, and an amended schedules bar date that runs 21 days from notice of any schedule amendments. For 503(b)(9) claims, the order required proof of delivery and invoice documentation for goods delivered in the 20 days before the petition date.
Key Timeline
Date
Event
2024-10-14
Chapter 11 petitions and first day declaration filed
2024-10-15
Cash collateral motion filed
2024-10-18
Interim cash collateral order entered
2024-11-01
Bar date order entered
2024-11-04
Final cash collateral order entered
2024-11-04
Bid protections and assignment procedures order entered
2024-11-13
Sale order entered for Do it Best transaction
2024-11-27
503(b)(9) bar date
2024-12-05
General bar date
2025-01-21
Initial plan and disclosure statement filed
2025-02-12
Second amended plan and disclosure statement filed
2025-03-31
Third amended plan filed
2025-04-14
Governmental bar date
2025-04-17
Confirmation order entered
2025-04-25
Plan Effective Date
2025-04-28
Notice of Effective Date filed
2025-05-25
Administrative claims bar date
2025-05-28
Post-confirmation rejection damages bar date
2025-06-09
Professional claims bar date
Frequently Asked Questions
What prompted True Value's chapter 11 filing?
Court filings cite post-pandemic demand normalization, supply chain disruptions, and tightened borrowing base availability as key drivers. Lenders exercised cash dominion and required consent for disbursements, which reduced working capital and pushed the company toward a sale-centered restructuring.
What is the status of the Do it Best transaction?
The transaction was structured as a 363 sale to Do it Best Corp. The company announced a sale agreement and a purchase price of $153 million, and the court entered a sale order on November 13, 2024. Coverage of the filing also highlighted the plan to sell the business to a rival operator.
Are independent True Value stores part of the bankruptcy?
The first day declaration indicates that member stores are independently owned and are not debtors in the chapter 11 cases, with one company-owned store in Palatine, Illinois as an exception. The debtors presented the case as a restructuring of the wholesale platform rather than the independent retail stores.
When were the plan confirmation and effective dates?
The court entered the confirmation order on April 17, 2025, and the plan became effective on April 25, 2025. Those dates are reflected in the Notice of Effective Date filed in late April 2025.
What were the key bar dates for claims?
The 503(b)(9) bar date was November 27, 2024, the general bar date was December 5, 2024, and the governmental bar date was April 14, 2025. Post-confirmation deadlines included a May 25, 2025 administrative claims bar date, a June 9, 2025 professional claims bar date, and a May 28, 2025 rejection damages bar date.
How does the plan treat creditor classes?
Priority and other secured claims are unimpaired and paid in full in cash or otherwise treated as unimpaired. Prepetition lender claims and general unsecured claims are impaired and receive litigation trust interests and related distributions, while subordinated claims and existing equity interests are canceled with no distribution.
Who is the plan administrator?
Michael I. Goldberg serves as the plan administrator and is responsible for implementing the confirmed plan, administering reserves, and overseeing claim reconciliation and litigation trust activities.
Who is the claims agent for True Value Company?
Omni Agent Solutions serves as the claims and noticing agent. It administered the claims deadlines set in the bar date order, including the December 5, 2024 general bar date and the November 27, 2024 section 503(b)(9) deadline.
Ask our AI chat to review the True Value docket, including the key filings, orders, and deadlines behind this case. For docket monitoring and AI research access, see ElevenFlo pricing.
reported at filing https://www.law360.com/bankruptcy-authority/articles/1890265/true-value-hammered-by-economy-lenders-tight-screws
funded the chapter 11 case and moved up the sale https://www.law360.com/bankruptcy-authority/articles/2253592/true-value-hammers-out-deal-to-fund-ch-11-speed-up-sale
objected that the stalking-horse sale undervalued the business https://www.glennagre.com/headlines/glenn-agre-secures-major-win-for-true-value-in-chapter-11-dispute/
filed reclamation notices seeking the return of goods https://hardwareretailing.com/vendors-seek-return-of-goods-or-payment-from-true-value-courts-list-exec-bonuses-and-payouts/
approved procedures for True Value to reject leases and contracts https://www.law360.com/bankruptcy-authority/articles/2262805/true-value-can-reject-leases-following-153m-ch-11-sale
Delaware bankruptcy judge approved the post-sale plan https://www.law360.com/articles/2322786/true-value-gets-ok-for-post-sale-ch-11-plan
south Kansas City distribution center in April 2025 https://www.kshb.com/news/local-news/true-value-hardware-moves-forward-with-closing-south-kansas-city-facility-50-jobs-impacted
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.