Rite Aid Corporation (NYSE:RAD) filed for Chapter 11 bankruptcy protection in New Jersey and said it would begin restructuring to reduce its debt. Elixir Insurance is not included in the Chapter 11 process.

Rite Aid is evaluating its store portfolio, and in connection with the court-supervised process, the company will close additional underperforming stores.

Rite Aid also said lenders agreed to provide $3.45 billion in new funding to "provide sufficient liquidity" as it embarks on its restructuring plan.

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Rite Aid also appointed Jeffrey Stein as Chief Executive Officer, Chief Restructuring Officer, and a member of the company's Board of Directors, effective immediately.

He succeeds Elizabeth ("Busy") Burr, who has served as Interim CEO since January 2023. Ms. Burr will continue as a Director on the company's board.

The drug retailer is grappling with over a thousand consolidated federal lawsuits in Ohio and numerous similar state lawsuits.

During its most recent Q1, revenue fell to $5.6 billion, down from $6.01 billion in the year-ago period. Net losses widened to $306.7 million, compared to a net loss of $110.2 million a year ago.

Rite Aid warned investors it expects to lose between $650 million and $680 million for FY24.

Price Action: RAD shares closed at $0.65 on Friday.