UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 8-K

 

 

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): February 5, 2021

 

FRANCESCA’S HOLDINGS CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

 

    Delaware    
001-35239   (State or Other Jurisdiction of Incorporation)   20-8874704
(Commission File Number)       (I.R.S. Employer Identification No.)
         

8760 Clay Road,

Houston, Texas

     

 

77080

 (Address of Principal Executive Offices)       (Zip Code)

 

(713) 864-1358

(Registrant’s Telephone Number, Including Area Code)

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock, par value $.01 per share   FRAN*   The Nasdaq Stock Market LLC*

 

* As previously disclosed, the Company’s common stock was suspended from trading on The Nasdaq Stock Market (“Nasdaq”) at the opening of business on December 15, 2020 and Nasdaq has commenced proceedings to delist and deregister the Company’s common stock from Nasdaq.

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company o

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

 

 

 

 

 

 

Item 5.02Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

(b) On February 8, 2021, Ms. Marie Toulantis resigned from her position as a Class I director of the Board of Directors (the “Board”) of Francesca’s Holdings Corporation (the “Company”) and Mr. Richard Emmett resigned from his position as a Class II director of the Board, in each case, effective immediately. The resignation of Ms. Toulantis and Mr. Emmett was not the result of a disagreement with the Company or on any matter relating to the Company’s operations, policies or practices.

 

Item 7.01Regulation FD Disclosure.

 

As previously reported, on December 3, 2020, the Company and each of its subsidiaries (together with the Company, the “Debtors”) commenced voluntary cases (the “Chapter 11 Cases”) for relief under chapter 11 of title 11 of the United States Code, §§ 101-1532, et seq. in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Chapter 11 Cases are being jointly administered under the caption In re: Francesca's Holdings Corporation, et al., Case No. 20-13076 (BLS). 

 

On February 5, 2021, the Debtors filed with the Bankruptcy Court their monthly operating report for the period beginning December 3, 2020 and ending January 2, 2021 (the “Monthly Operating Report”). This Current Report on Form 8-K, including the exhibit hereto (the “Form 8-K”), will not be deemed an admission as to the materiality of any information disclosed herein. The Monthly Operating Report and other documents filed with the Bankruptcy Court are available for review and free of charge online at https://cases.stretto.com/francescas. Documents and other information available on such website are not part of this Form 8-K and are not deemed to be incorporated by reference in this Form 8-K.

 

A copy of the Monthly Operating Report is furnished as Exhibit 99.1 to this report and is incorporated herein by reference. This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

 

Cautionary Statement Regarding the Monthly Operating Report

 

The Company cautions investors and potential investors not to place undue reliance upon the information contained in the Monthly Operating Report, which was not prepared for the purpose of providing the basis for an investment decision relating to any of the securities of the Company. The Monthly Operating Report is limited in scope, covers a limited time period and has been prepared solely for the purpose of complying with the reporting requirements of the Bankruptcy Court. The Monthly Operating Report was not audited or reviewed by independent accountants, was not prepared in accordance with generally accepted accounting principles, is in a format prescribed by applicable bankruptcy laws or rules, and is subject to future adjustment and reconciliation. There can be no assurance that, from the perspective of an investor or potential investor in the Company’s securities, the Monthly Operating Report is complete. Results and projections set forth in the Monthly Operating Report should not be viewed as indicative of future results.

  

Cautionary Statement Regarding Forward-Looking Information

 

Certain statements in the Monthly Operating Report are "forward-looking statements" made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Such forward-looking statements reflect the Company’s current expectations or beliefs concerning future events and are subject to various risks and uncertainties that may cause actual results to differ materially from those that are expected. These risks and uncertainties include, but are not limited to, the following: risks attendant to the bankruptcy process, including the Company’s ability to obtain court approval from the Bankruptcy Court with respect to motions or other requests made to the Bankruptcy Court throughout the course of the Chapter 11 Cases, the effects of the Chapter 11 Cases, including increased legal and other professional costs incurred in connection with the Company’s recently completed asset sale, on the Company’s liquidity (including the availability of operating capital during the pendency of the Chapter 11 Cases), results of operations or business prospects during the Chapter 11 Cases; the length of time that the Company will operate under Chapter 11 protection; risks associated with third-party motions in the Chapter 11 Cases and the Company’s ability to realize proceeds from remaining assets; Bankruptcy Court rulings in the Chapter 11 Cases and the outcome of the Chapter 11 Cases in general; risks associated with the Company’s planned closing of boutiques in connection with the Company’s recently completed asset sale; and risks related to the trading of the Company’s common stock on the OTC Pink Market and impacts from the impending delisting of the Company’s common stock from the Nasdaq Stock Market LLC. For additional information regarding these and other risks and uncertainties that could cause actual results to differ materially from those contained in the Company’s forward-looking statements, please refer to "Risk Factors" in the Company’s Annual Report on Form 10-K for the year ended February 2, 2020 filed with the Securities and Exchange Commission on May 1, 2020. The Company undertakes no obligation to publicly update or revise any forward-looking statement.

 

 

 

 

Item 9.01Financial Statements and Exhibits.

 

(d)  Exhibits

 

Exhibit No.   Description
99.1   Monthly Operating Report

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  FRANCESCA’S HOLDINGS CORPORATION
       
Date: February 8, 2021 By: /s/ Anthony Saccullo
    Anthony Saccullo
    Chief Wind-down Officer

 

 

 

 

 

Exhibit 99.1

 

UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al.Debtors Reporting Period: December 3, 2020 - January 2, 2021

 

MONTHLY OPERATING REPORT

Reporting Period: December 3, 2020 - January 2, 2021

 

REQUIRED DOCUMENTS Form No. Document
Attached
Explanation
Attached

Affidavit/
Supplement
Attached

Schedule of Cash Receipts and Disbursements MOR-1 X X  
Bank Account Balances, Debtor Statement with Respect to Bank Account Reconciliations MOR-la X X See Attestation
Schedule of Professional Fees and Expenses Paid MOR-lb X    
Copies of bank statements       See Attestation
Cash disbursements journals       See Attestation
Statement of Operations by Legal Entity MOR-2 X X  
Balance Sheet by Legal Entity MOR-3 X X  
Status of Postpetition Taxes       See Attestation
Summary of Unpaid Postpetition Debts MOR-4 X    
Accounts Receivable Reconciliation and Aging MOR-5 X    
Debtor Questionnaire MOR-5 X    
Opening Balance Sheet by Legal Entity Exhibit A X    
Disbursements by Legal Entity Exhibit B X    

 

 

 

I declare under penalty of perjury (28 U.S.C. Section 1746) that this report and the attached documents are true and correct to the best of my knowledge and belief.

 

    02/05/2021  

Signature of Debtor

Cindy Thomassee1

Chief Financial Officer of Francesca’s Holdings Corporation, et al.

  Date  

 

 

1 As of January 30, 2021, Cindy Thomassee is no longer an officer of the Debtors; however, she has signed the December Monthly Operating Report as the financial information included herein relates to the period prior to her resignation.

 

Page 1 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al.Debtors Reporting Period: December 3, 2020 - January 2, 2021

 

Notes to the Monthly Operating Report (“MOR”)

Reporting Period: December 3, 2020 - January 2, 2021

 

General:

 

The Debtors filed for relief under chapter 11 of title 11 of the United States Code, §§ 101-1532, et seq. (the “Bankruptcy Code”) on December 3, 2020 (the “Petition Date”). Per agreement with the Office of the United States Trustee for the District of Delaware (the “U.S. Trustee”), the Debtors have prepared this monthly operating report on a fiscal month basis (this “MOR”) for the period from December 3, 2020 through January 2, 2021. In addition, the U.S. Trustee has agreed to extend the Debtors’ deadline to file this MOR to February 5, 2021.

 

The financial information contained herein is unaudited, limited in scope, covers a limited time period, and has been prepared solely for the purpose of complying with the monthly reporting requirements applicable in these chapter 11 cases. This MOR is not prepared in accordance with GAAP and does not include all of the information and footnotes required thereby. Additionally, certain transactions that would be required to be included in GAAP financial statements are not reflected in this MOR. There can be no assurance that the financial information presented herein is complete, and readers are strongly cautioned not to place reliance on this MOR, which was not prepared for the purpose of providing the basis for an investment decision relating to the Debtors. The unaudited financial statements have been derived from the books and records of the Debtors. The information furnished in this MOR includes certain normal recurring adjustments, but may not include all the adjustments that would typically be made for the quarterly and annual consolidated financial statements in accordance with GAAP. Furthermore, the monthly financial information contained herein has not been subjected to the same level of accounting review and testing that the Debtors apply in the preparation of its annual financial information in accordance with GAAP. Upon the application of such procedures, the Debtors believe that the financial information may be subject to change, and these changes could be material. The financial information contained herein is presented on a preliminary and unaudited basis and remains subject to future adjustment (which may be material) and reconciliation. However, the Debtors are not required to publicly update this MOR to reflect more current facts or estimates, or upon the occurrence of future events, including if the facts, estimates, or assumptions upon which this MOR is based change.

 

Notes to MOR-1:

 

Cash is received and disbursed by the Debtors as described in the Debtors' Motion for Entry of Interim and Final Orders (I) Authorizing Continued Use of the Debtors' Existing Cash Management System, Corporate Credit Card Program and Bank Accounts; (II) Waiving Certain United States Trustee Requirements; (III) Extending Time to Comply with Section 345(b) of the Bankruptcy Code; (IV) Authorizing Continued Performance of Intercompany Transactions; and (V) Granting Related Relief [D.I. 29] and is consistent with the Debtors’ historical cash management practices. Cash receipts and disbursements reflected herein include activity from December 3, 2020 to January 2, 2021. Cash receipts and disbursements were derived from the bank statements and accounting system. Cash receipts and disbursements related to intercompany transfers among the Debtors such as cash concentration account sweeps and expense reimbursements, are excluded from total cash receipts and disbursements set forth in MOR-1. Cash receipts and disbursements include certain intercompany expense transactions.

 

Notes to MOR-la:

 

Amounts listed are the bank balances as of the close of business on January 2, 2021. Copies of the bank statements were not included with this MOR due to the voluminous nature of the statements and are available upon reasonable request in writing to counsel for the Debtors.

 

Page 2 of 15

 

 

Notes to MOR-2 and MOR-3:

 

This MOR has been prepared on a legal entity basis for the Debtors.

 

As a result of the Debtors’ chapter 11 filings, the payment of prepetition indebtedness is subject to compromise or other treatment under a plan of reorganization. The amounts currently classified as liabilities subject to compromise may be subject to future adjustments depending on Bankruptcy Court actions, payments pursuant to Bankruptcy Court order, further developments with respect to, among other things, the reconciliation and adjudication of claims, determinations of the secured status of certain claims, the value of any collateral securing such claims, rejection of executory contracts, or other events. The determination of how liabilities will ultimately be settled and treated cannot be made until the Bankruptcy Court approves a chapter 11 plan of reorganization. Accordingly, the ultimate amount of such liabilities is not determinable at this time. No assurance can be given as to the value, if any, that may be ascribed to the Debtors' various prepetition liabilities and other securities.

 

Page 3 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al.Debtors Reporting Period: December 3, 2020 - January 2, 2021

 

MOR-1
Schedule of Cash Receipts and Disbursements

Reporting Period: December 3, 2020 - January 2, 2021
($
’s in USD)

 

                   Cumulative[1] 
#  FCI   FSC   FHC   FLLC   12/3/20 Ͳ 1/2/21 
1        Receipts                         
2        Credit Card and Cash Receipts  $49,506,259   $-   $-   $         -   $49,506,259 
3        Inventory Liquidation   -    -    -    -    - 
4        Federal Tax Refund   -    -    -    -    - 
5            Total Receipts   49,506,259    -    -    -    49,506,259 
6        Operating Disbursements                         
7        Payroll & Taxes   4,810,077    1,004,574    -    -    5,814,651 
8        Rent   4,948,936    106,565    -    -    5,055,501 
9        Inventory   -    6,398,530    -    -    6,398,530 
10       Sales Tax   2,538,279    -    -    -    2,538,279 
11       Merchant Fees   65,545    -    -    -    65,545 
12       Employee Benefits   76,619    434,895    -    -    511,514 
13       Marketing   -    293,740    -    -    293,740 
14       Professional/Computer Services   -    1,028,108    -    -    1,028,108 
15       Other A/P   959,569    1,447,210    42    -    2,406,821 
16           Total Operating Disbursements   13,399,025    10,713,623    42    -    24,112,691 
17           Net Cash Flow from Operations  $36,107,234   $(10,713,623)  $(42)  $-   $25,393,569 
18       Non-Operating Disbursements / (Receipts)                         
19       Debt Service   -    -    -    -    - 
20       State Taxes   2,209    -    -    -    2,209 
21       Federal Taxes   -    -    -    -    - 
22       CapEx   -              -    - 
23       Tenant Allowance   -    -    -    -    - 
24           Total Non-Operating Disbursements / (Receipts)   2,209    -    -    -    2,209 
25           Net Cash Flow Before Restructuring  $36,105,025   $(10,713,623)  $(42)  $-   $25,391,360 
26       Restructuring Related Disbursements                         
27       Professional Fees[2]   -    3,247,000    -    -    3,247,000 
28       Credit Card Program Deposits   -    -    -    -    - 
29       Utility Deposit   205,000    -    -    -    205,000 
30       503(b)(9) and Critical Vendor Payments   -         -         - 
31       KEIP/KERP   -    -    -    -    - 
32       UST Fees   -    275,000    -    .    275,000 
33       DIP Fees & Interest-Term   -    -    -    -    - 
34       DIP Fees & Interest-Revolver   -    300,000    -    -    300,000 
35       Prepetition Term Loan Repayment   -    -    -    -    - 
36       Cure Costs   -    -    -    -    - 
37       Other   -    -    -    -    - 
38           Total Restructuring Related Disbursements   205,000    3,822,000    -    -    4,027,000 
39           Net Cash Flow  $35,900,025   $(14,535,623)  $(42)  $-   $21,364,360 
                          
40           Beginning Cash Balance  $7,158,003   $1,648,914   $19,798    -   $8,826,715 
41       Net Cash Flow   35,900,025    (14,535,623)   (42)   -    21,364,360 
42       Borrowings   -    28,800,000    -    -    28,800,000 
43       Repayments[3]   (47,117,717)   -    -    -    (47,117,717)
44       Intercompany   10,600,000    (10,600,000)   -    -    - 
45           Ending Cash Balance  $6,540,311   $ 5,313,291   $19,756   $-   $11,873,358 

 

Footnotes:

 

[1] Cash balance represents book balance, which is net of outstanding checks and may differ from bank balance due to the timing of items being posted to the Debtors' bank accounts.
[2] Professional fees include $100,000 Debtor-in-Possession (“DIP”) fee to Tiger Group, $100,000 prepayment to A&G Realty Partners LLC, and $200,000 in legal prepayments to the stalking horse bidder. Remaining $2.847M paid into the professional fee carve out escrow per terms of the DIP financing agreement.
[3] Repayments includes collections held by DIP lender. These amounts are shown as restricted cash on the Balance Sheet.

 

Page 4 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

MOR-la

Bank Account Balances, Debtor Statement with Respect to Bank Account Reconciliations

Reporting Period: December 3, 2020 - January 2, 2021

($’s in USD)

  

#   Debtor Entity  Account Number
(Last 4 Digits)
   Bank  Account Type  For the Period Ended
1/2/2021[1]
 
1   Francesca's Collections, Inc.   9049   Chase  Depository  $  428,296 
2   Francesca's Collections, Inc.   5974   Wells Fargo  Checking   1,554,476 
3   Francesca's Collections, Inc.   5309   Bank of America  Depository   943,114 
4   Francesca's Collections, Inc.   5744   Regions  Depository   238,897 
5   Francesca's Collections, Inc.   9450   Citizens  Depository   254,109 
6   Francesca's Collections, Inc.   4465   BB&T  Depository   48,778 
7   Francesca's Collections, Inc.   3154   PNC  Depository   294,152 
8   Francesca's Collections, Inc.   4758   Fifth Third  Depository   149,848 
9   Francesca's Collections, Inc.   8807   US BANK  Depository   187,412 
10   Francesca's Collections, Inc.   2091   IBC  Depository   11,046 
11   Francesca's Collections, Inc.   0085   Pinnacle Bank  Depository   20,333 
12   Francesca's Collections, Inc.   4128   Community First Nat'I  Depository   14,350 
13   Francesca's Collections, Inc.   0596   First Citizens Bank  Depository   88,799 
14   Francesca's Collections, Inc.   8962   Chase  Passthrough   - 
15   Francesca's Collections, Inc.   4644   Chase  Checking   1,094,560 
16   Francesca's Collections, Inc.   4669   Chase  Checking   - 
17   Francesca's Collections, Inc.   5990   Wells Fargo  Depository   420,278 
18   Francesca's Holdings Corporation   9350   Chase  Checking   19,756 
19   Francesca's Services Corporation   8238   Chase  Checking   5,313,291 
20   Francesca's Collections, Inc.   3265   Chase  Checking/Depository   398,861 
21   Francesca's Collections, Inc.   4651   Chase  Depository   - 
22           Cash and Cash Equivalents at Financial Institutions  $11,480,355 
23   Francesca's Collections, Inc.       Petty Cash Held at Boutiques   393,003 
24           Reported Cash and Cash Equivalents at 1/2/2021  $11,873,358 
25   Francesca's Collections, Inc.   7861   Chase  Certificate of Deposit[2]   214,510 

 

Footnotes:

[1] Cash balance represents book balance, which is net of outstanding checks and may differ from bank balance due to the timing of items being posted to the Debtors' bank accounts.

[2] Certificate of Deposit included in restricted cash on Debtors' Balance Sheet.

 

Page 5 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

MOR-la

Debtor Attestation to with Respect to Bank Account Reconciliations, Bank Statements and

Open/Closed Bank Accounts

Reporting Period: December 3, 2020 - January 2, 2021

 

Bank Account Reconciliations & Cash Disbursement Journal

 

The Debtors affirm that bank account reconciliations are prepared for all open and active bank accounts on a monthly basis. The Debtors affirm that within their financial accounting systems, check registers and/or disbursement journals are maintained for each disbursement account.

 

Bank Statement

 

The Debtors affirm that bank statements for all open and active bank accounts are retained by the Debtors.

 

Open/Closed Bank Accounts

 

The Debtors did not open or close any bank accounts during December.

 

      02/05/2021  
Cindy Thomassee2   Date  
Chief Financial Officer of Francesca’s Holdings Corporation, et al.    

 

 

 

2 As of January 30, 2021, Cindy Thomassee is no longer an officer of the Debtors; however, she has signed the December Monthly Operating Report as the financial information included herein relates to the period prior to her resignation.

  

Page 6 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

MOR-lb

Schedule of Professional Fees and Expenses Paid

Reporting Period: December 3, 2020 - January 2, 2021

($’s in USD)

 

There were no payments made to bankruptcy professionals between December 3, 2020 and January 2, 2021.

 

Page 7 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

MOR-2

Statement of Operations by Legal Entity

Reporting Period: December 3, 2020 - January 2, 2021

($’s in USD)

 

Category  FCI   FSC   FHC   FLLC   Consolidated 
1 Net sales  $46,034,503   $42,520   $-   $-   $46,077,02 
2 Cost of goods sold and occupancy costs  26,722,869         -    -    3 26,722,869 
3 Gross profit   19,311,634    42,520    -    -    19,354,154 
4 Selling, general and administrative expenses   7,572,604    3,333,844    42    -    10,906,490 
5 (Loss) income from operations   11,739,030    (3,291,324)   (42)   -    8,447,664 
6 Restructuring (expenses)[1]   -    (3,754,222)    -    -    (3,754,222)
7 Asset impairment charges[2]   (31,879,221)   (288)   -    -    (31,879,510)
8 Interest income (expense)   -         -    -    (137,649)
9 Other income (expense)   16,022    (254,334)   -    -    (238,312)
10 (Loss) income before income tax expense   (20,124,169)   (7,437,819)   (42)   -    (27,562,029)
11 Income tax expense   (6,166,701)   -    -    -    (6,166,701)
12 Net (loss) income  $     (13,957,468)   $(7,437,819)  $(42)  $-   $(21,395,328)

 

Footnotes:

 

[1] Restructuring expenses include $3.45M of restructuring professional fees and a $300K DIP financing fee.

[2] Asset impairment charges include $28.1M of lease right-of-use asset impairment and $3.8M of property, plant, and equipment asset impairment associated with January close stores.

 

Page 8 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

MOR-3
Balance Sheet by Legal Entity

Reporting Period: December 3, 2020 - January 2, 2021
($
’s in USD)

 

Balance Sheet at 01/02/2021

 

# Category  FCI   FSC   FHC   FLLC   Eliminations   Consolidated 
  Assets                              
  Current Assets                              
1 Cash and cash equivalents  $6,540,311   $5,313,291   $19,756   $-   $-   $11,873,358 
2 Accounts receivable   17,831,345    239,492,890    -    -    (237,914,230)   19,410,006 
3 Inventories   26,591,794    (77,081)   -    -    (2,233,609)   24,281,104 
4 Prepaid expenses and other current assets   7,012,754    25,966,341    -    -    -    32,979,095 
5 Total Current Assets   57,976,204    270,695,441    19,756    -    (240,147,839)   88,543,562 
6 Operating lease right-of-use assets, net   118,926,429    3,927,417    -    -    -    122,853,846 
7 Property and equipment, net   26,240,460    3,680,137    -    -    -    29,920,597 
8 Other assets, Net   125,252    1,611,871    202,315,652    -         204,052,775 
9 Total Assets  $203,268,345   $279,914,866   $202,335,408   $-   $(240,147,839)  $445,370,780 
  Liabilities And Stockholders' Eauitv                              
  Current Liabilities                              
10 Accounts payable  $245,303,651   $20,592,913   $857,028   $-   $(237,914,230)  $28,839,362 
11 Accrued liabilities   8,701,428    4,965,502    -    -    -    13,666,930 
12 Current portion of long-term debt   -    -    -    -    -    - 
13 Current portion of operating lease liabilities   107,414,454    1,021,461    -    -    -    108,435,915 
14 Total Current Liabilities   361,419,533    26,579,877    857,028    -    (237,914,230)   150,942,207 
15 Operating lease liabilities   136,355,279    3,211,950    -    -         139,567,229 
16 Long-term debt, net        9,323,154    -    -         9,323,154 
17 Other liabilities   (202,240,947)   40,347,094    162,486,232    -    (520,322)   72,058 
18 Total Liabilities   295,533,866    79,462,074    163,343,260    -    (238,434,552)   299,904,647 
19 Preferred Stock   -    -    -    -    -    - 
  Stockholders' Eauitv                              
20 Common stock   -    1    39,474    -    (2)   39,473 
21 APIC   -    8,609,538    113,223,502    -    (8,609,537)   113,223,503 
22 Retained earnings   (92,265,521)   191,843,253    85,750,555    -    6,896,252    192,224,540 
23 Treasury stock   -    -    (160,021,383)   -    -    (160,021,383)
24 Total Stockholders'Equity   (92,265,521)   200,452,792    38,992,148    -    (1,713,287)   145,466,133 
25 Total Liabilities And Stockholders' Equity  $203,268,345   $279,914,866   $202,335,408   $-   $(240,147,839)  $445,370,780 

 

Page 9 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

Debtor Attestation with Respect to Postpetition Taxes

Reporting Period: December 3, 2020 - January 2, 2021

 

 

Cindy Thomassee hereby declares under penalty of perjury:

 

I am the Chief Financial Officer of Francesca’s Holdings Corp., et al., the above captioned debtors and debtors in possession (collectively the "Debtors"). I am familiar with the Debtors’ day-to-day operations, business affairs, and books and records. I am authorized to submit this statement on behalf of the Debtors.

 

All statements in this statement are based on my personal knowledge, my review of the relevant documents, my discussions with other employees of the Debtors, or my opinion based upon my experience and knowledge of the Debtors' operations and financial condition. If I were called upon to testify, I could and would testify to each of the facts set forth herein based on such personal knowledge, review of documents, discussions with other employees of the Debtors or opinion.

 

To the best of my knowledge, information and belief, and except as otherwise set forth in the MOR, all of the Debtors have filed all the necessary federal, state and local tax returns, or extensions related there to, and have timely made (or are in the process of remediating any immaterial late filings or prepayments) all related required postpetition tax payments, which are not subject to dispute or reconciliation, and are current.

 

    02/05/2021 
Cindy Thomassee3   Date 
Chief Financial Officer of Francesca’s Holdings Corporation, et al.     

 

 

 

3 As of January 30, 2021, Cindy Thomassee is no longer an officer of the Debtors; however, she has signed the December Monthly Operating Report as the financial information included herein relates to the period prior to her resignation.

 

Page 10 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

MOR-4
Summary of Unpaid Postpetition Debts

Reporting Period: December 3, 2020 - January 2, 2021
($
’s in USD)

 

           Days past Due       
#   Accounts Payable  Current   0-30 Days   31 - 60 Days   61 - 90 Days   >91 Days   Total 
 1   Combined Debtors[1][2]  $1,644,841   $208,753   $-   $-   $-   $1,853,594 

  

Footnotes:

 

[1] The postpetition accounts payable represents open and outstanding trade vendor invoices that have been entered into the Debtors’ accounts payable system.

[2] This summary does not include accruals or intercompany payables.

 

Page 11 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

MOR-5
Accounts Receivable Reconciliation and Aging

Reporting Period: December 3, 2020 - January 2, 2021
($
’s in USD)

Accounts Receivable Reconciliation

 

    Reconciliation  Beginning
Accounts
Receivable
   Change in
Accounts
Receivable
   Ending
Accounts
Receivable
 
 1   Total Accounts Receivable[1][2]  $10,783,714   $8,626,291   $19,410,006 

 

 

Accounts Receivable Aging

 

       Days Past Due             
  #      Aging  Current   0-30 Days   31 - 60 Days   61 - 90 Days   91+ Days   Total   Uncollectible   AR (Net) 
2 Sales Receivables  $3,521,667   $-   $-   $-   $-   $3,521,667   $-   $3,521,667 
3 Insurance Receivables   -    -    -    -    110,351    110,351    -    110,351 
4 Income Tax Receivables   14,005,541    -    -    -    -    14,005,541    -    14,005,541 
5  Employee Receivables   -    494    -    -    2,151    2,645    -    2,645 
6  Landlord Receivables   -    -    -    7,897    -    7,897    -    7,897 
7 Vendor Credit Receivables   1,761,904    -    -    -    -    1,761,904    -    1,761,904 
8 Total Accounts Receivable[1][2]  $19,289,112   $494   $-   $7,897   $112,502   $19,410,006   $-   $19,410,006 

 

Footnotes:

[1] Amounts are aged from the due date and shown on a gross basis before any adjustment for estimated bad debts and other uncollectable amounts.

[2] This summary does not include any accrued fees, discounts or intercompany receivables.

 

Page 12 of 15

 

  

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

 

MOR-5
DEBTOR QUESTIONNAIRE

Reporting Period: December 3, 2020 - January 2, 2021

 

Must be completed each month Yes No
1.     Have any assets been sold or transferred outside the normal course of business this reporting period? If yes, provide an explanation below.   X
2.     Have any funds been disbursed from any account other than a debtor in possession account this reporting period? If yes, provide an explanation below.   X

3.       

Have all postpetition tax returns been timely filed? If no, provide an explanation below.

X  
4.        Are workers compensation, general liability and other necessary insurance coverages in effect? If no, provide an explanation below. X  
5.     Has any bank account been opened during the reporting period? If yes, provide documentation identifying the opened account(s). If an investment account has been opened provide the required documentation pursuant to the Delaware Local Rule 4001-3.   X

 

Page 13 of 15

 

 

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

  

Exhibit A
Balance Sheet by Legal Entity

Reporting Period: December 3, 2020 - January 2, 2021
($
’s in USD)

 

Opening Balance Sheet at 12/03/2020

 

#     Category  FCI   FSC   FHC   FLLC   Eliminations   Consolidated 
  Assets                              
  Current Assets                              
Cash and cash equivalents  $7,158,003   $1,648,914   $19,798   $-   $-   $8,826,715 
2 Accounts receivable   10,719,938    214,664,735    -    -    (214,600,960)   10,783,714 
3 Inventories   46,705,793    1,560,760    -    -.    (6,530,967)   41,735,586 
4 Prepaid expenses and other current assets   2,453,610    13,448,974    -    -    -    15,902,584 
5 Total Current Assets   67,037,345    231,323,383    19,798    -    (221,131,927)   77,248,599 
Operating lease right-of-use assets, net   146,626,533    3,946,899    -.    -.    -    150,573,432 
7 Property and equipment, net   31,214,215    3,819,887    -    -    -    35,034,101 
8 Other assets, Net   120,252    1,944,209    202,315,652    -    (202,315,652)   2,064,460 
9 Total Assets  $244,998,345   $241,034,377   $202,335,450   $-   $(423,447,579)  $264,920,593 
  Liabilities And Stockholders' Equity                              
  Current Liabilities                              
10 Accounts payable  $51,640,070   $26,981,239   $162,851,380   $-   $(215,121,282)  $26,351,406 
11 Accrued liabilities   5,636,061    4,760,958    -    -    -.    11,397,020 
12 Current portion of long-term debt             -    -    -    - 
13 Current portion of operating lease liabilities   107,325,948    1,021,461    -    -    -    108,347,410 
14  Total Current Liabilities   165,602,079    32,763,659    162,851,380    -    (215,121,282)   146,095,835 
15 Operating lease liabilities   136,355,279    3,231,432    -    -    -    139,586,711 
16 Long-term debt, net   -    14,200,357    -    -    -    14,200,357 
17 Other liabilities   -    -    493,821    -    -    493,821 
18 Total Liabilities   301,957,358    50,195,448    163,345,201    .    (215,121,282)   300,376,724 
19 Preferred Stock   -    -         -    -    - 
  Stockholders' Equity                              
20 Common stock   -    1    39,474    -    (2)   39,473 
21 APIC        8,609,538    113,221,561    -    (8,609,537)   113,221,562 
22 Retained earnings   (56,959,014)   182,229,390    85,750,597    -.    (199,716,758)   11,304,216 
23 Treasury stock   -    -    (160,021,383)   -    -    (160,021,383)
24  Total Stockholders' Equity   (56,959,014)   190,838,929    38,990,249    -    (208,326,297)   (35,456,132)
25 Total Liabilities And Stockholders' Equity  $244,998,345   $241,034,377   $202,335,450   $-   $(423,447,579)  $264,920,593 

 

Page 14 of 15

 

  

In re: Case No. 20-13076 (BLS)
Francesca’s Holdings Corporation, et al. Reporting Period: December 3, 2020 - January 2, 2021
Debtors  

  

Exhibit B

Disbursements by Legal Entity

Reporting Period: December 3, 2020 - January 2, 2021

($’s in USD)

 

#   Debtor Name  Abbreviation   Case Number  Disbursements1 
 1   Francesca's Holdings Corporation   FHC   20-13076  $42 
 2   Francesca's, LLC   FLLC   20-13077   - 
 3   Francesca's Collections, Inc.   FCI   20-13078   13,606,234 
 4  Francesca's Services Corporation   FSC   20-13079   14,535,623 
 5  Total          $28,141,900 

 

Footnotes:

1 Includes disbursements made December 3, 2020 - January 2, 2021.

 

Page 15 of 15