Friedman's jewelry company emerges from bankruptcy

<p>Friedman's Incorporated has emerged from Chapter Eleven bankruptcy less than a year after filing.</p><p>The jewelry retailer based in Savannah announced yesterday that its reorganization plan became effective December ninth.</p><p>The company filed for bankruptcy January 14th.</p><p>The filing followed charges of fraud by the Securities and Exchange Commission and the company's later announcement that its audited financial statements for 2001 and 2002 were incorrect.</p><p>Friedman's settled the S-E-C charge in late November by agreeing to pay two (m) million dollars to a fund aimed at preventing fraud. The company also has replaced all its senior management.</p><p>Friedman's outstanding common stock was canceled as part of the court-approved reorganization plan approved by the U.S. Bankruptcy Court in November. The cancellation eliminates any control over the company by those stockholders.</p><p>Court documents show that Friedman's has become a private company that is owned in part by Harbert Management Corporation, which invests in struggling companies.</p><p>The company said in a news release yesterday that Friedman's was obligated with 149 million dollars in secured debt upon emerging from Chapter Eleven.</p><p>The release says most of the debt has been eliminated or refinanced by C-I-T Group Incorporated -- which approved Friedman's with 125 million dollars in financing.</p><p>Earlier this month, Friedman's announced it would emerge from bankruptcy with 424 stores. The company plans to close 51 of those after the Christmas season.</p><p>Friedman's has four stores in Savannah and one in Garden City. It's NOT known whether any of the five stores will be among the closings.</p>