Body Central Corp. is going out of business, closing its remaining stores this weekend after failing to find additional capital, an attorney for the company said Friday.
The Jacksonville-based fashion retailer earlier this week said it was facing severe liquidity issues that could force it to file for a Chapter 11 bankruptcy reorganization.
Instead, it entered into an Assignment for the Benefit of Creditors with a firm that handles liquidation and workouts for troubled firms.
The Assignment for the Benefit of Creditors is an alternative to a federal court bankruptcy filing, essentially a “state court bankruptcy liquidation,” said Gardner Davis, an attorney for Foley & Lardner in Jacksonville who represented Body Central in its efforts to reorganize.
The stores will be holding going-out-of-business sales this weekend but are expected to close by Sunday night, Davis said.
“This is a great tragedy because the company has 2,500 loyal, hard-working employees who are losing their jobs,” he said.
Body Central turned its business over to Michael Moecker & Associates, a Hollywood, Fla., firm that specializes in workout situations, to handle the liquidation. Proceeds from the liquidation will be turned over to creditors