Harry & David laid off nearly 100 full-time, salaried employees throughout its company on Friday, according to sources close to the company who asked to remain anonymous.
A Harry & David spokeswoman confirmed there were layoffs, but declined to say exactly how many or what departments were affected.
"As part of our ongoing effort to recapitalize our business, it is necessary to continue to reduce costs and streamline operations," said Cassandra Bujarski, of Sard Verbinnen & Co., a New York public-relations firm. "We had to make some very tough choices, including implementing a reduction in force today across all divisions of the company. With these efforts, we believe we are better positioned to continue to revitalize Harry & David."
Several sources told the Mail Tribune the cuts came in creative services, finance and inventory control. One area not hit, according to sources, was information technology.
The company has a satellite operation in Hebron, Ohio, and operated 122 Harry & David stores in 38 states at the end of the most recent quarter.
At least one store closed recently, in Arizona, when its lease expired.
Harry & David recently reported it would likely miss its $7 million March 1 interest payment on its bonds, which would lead to default and force the company into Chapter 11 reorganization.
Al Kennedy, a partner at Portland law firm Tonkon Torp, said layoffs are common as companies prepare for bankruptcy.
"The bondholders and lenders are pushing for payroll cuts as part of the negotiations that precede filing," Kennedy said. "At this point, creditors are pushing hard for streamlined operation."
Reach reporter Greg Stiles at 541-776-4463 or e-mail email@example.com.