Bed Bath & Beyond gets loan default notice from JPMorgan

© Reuters. FILE PHOTO: A person exits a Bed Bath & Beyond store in Manhattan, New York City, U.S., June 29, 2022. REUTERS/Andrew Kelly/File Photo

(Reuters) -Bed Bath & Beyond Inc has received a notice of acceleration and default interest for its loans from JPMorgan Chase (NYSE:) Bank N.A., a regulatory filing showed on Thursday.

Shares of the company slumped more than 22% to $2.52 in afternoon trading. 

The bank has determined to exercise rights such that all outstanding loans under credit facilities and other obligations of Bed Bath & Beyond (NASDAQ:) under its amended credit agreement are due and payable immediately.

The struggling home goods retailer said it does not have sufficient resources to repay the amount at this time, adding that it will consider all strategic alternatives, including restructuring its debt under the U.S. Bankruptcy Code.

Bed Bath & Beyond earlier this month said it was exploring a range of options to address its plunging sales that included declaring bankruptcy.

The company was also considering skipping debt payments due on Feb. 1, a source had told Reuters.

All of the outstanding loans and obligations under the credit facilities would bear interest at an additional default rate of 2% per annum, starting Jan. 25, as a result of continuing defaults, Bed Bath & Beyond said.

The company has also been in talks with prospective buyers and lenders to keep its business afloat, CNBC reported earlier in January.

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