Harry & David Files for Chapter 11 Bankruptcy

Gail Oskin/WireImage(MEDFORD, Ore.) -- Harry & David Holdings Inc., a retailer known for its gift baskets, Fruit of the Month Club and gourmet treats, announced Monday it has filed for Chapter 11 bankruptcy protection.

The Medford, Oregon-based company said it reached an agreement with about 81 percent of its senior noteholders on a reorganization plan that will get rid of the majority of the company's debt.  The noteholders also vowed to support a $55 million rights offering that will provide the company with the adequate amount of equity financing to come out of the bankruptcy.

Despite the bankruptcy filing, Harry & David said it will continue to conduct business online and at its stores nationwide.

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Future of Harry and David in Doubt

Photo Courtesy - Getty Images(MEDFORD, Ore.) -- After suffering major losses during the past year, gourmet food distributor Harry and David says it is unsure what it will take to continue to be successful and says the company now faces an uncertain future.

Harry and David previously announced more than $57 million in losses during the past year and now the company says it will take major restructuring to try to bounce back. The company is also keeping expectations in check, saying in a statement, "There can be no assurance that our efforts to obtain new capital and restructure our obligations will be successful, and therefore, there is substantial doubt as to our ability to continue."

Harry and David's public relations firm in New York says the company is continuing to operate, and look at all options in order to continue to be successful.

Copyright 2011 ABC News Radio