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Bed Bath & Beyond has entered into a vendor consignment agreement with Hilco Global’s ReStore Capital, an investment management company.
Under the agreement, ReStore Capital will buy up to $120 million in merchandise from Bed Bath’s key suppliers to boost inventory levels.
The home goods retailer has been unable to improve its inventory levels after relationships with its vendors soured.

Customers carry bags from Bed Bath & Beyond store on April 10, 2013 in Los Angeles, California.
Kevork Djansezian | Getty Images News | Getty Images

Bed Bath & Beyond announced Wednesday it is working with Hilco Global to get merchandise back on its shelves in the company’s latest effort to stay alive and avoid bankruptcy. 
The home goods retailer has entered into a vendor consignment program with ReStore Capital, an investment manager under Hilco that provides “creative financing solutions” to struggling companies. 

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Under the agreement, ReStore Capital will purchase up to $120 million, on a revolving basis at any given time, of pre-arranged merchandise from Bed Bath’s key suppliers to boost inventory levels at its namesake chain and Buybuy Baby. 
Bed Bath has been struggling to stock its shelves after its vendors tightened their credit terms, cut limits and required prepayments before agreeing to fulfill orders, the company has said previously. 
CEO Sue Gove said the company remains “relentless” in its attempts to overcome its operational and financial challenges.
“Our new vendor consignment program enables us to increase our inventory position in top items that customers are buying and improve the customer experience. This capital-light solution can allow us to strengthen merchandise availability and better fulfill demand,” Gove said in a news release. 
“We are doing what we must to sustain our business immediately and unlock our true value over the long-term – for all stakeholders.”

Gove noted the support the company has seen from its top suppliers and said it demonstrates Bed Bath’s “potential for sustainable improvement.” 
“We know the performance and value of our business today is not representative of our full potential,” Gove continued. “Our entire organization is focused on expanding and accelerating improvement.” 
Bed Bath has been exhausting all efforts to stay out of bankruptcy court after a series of dismal quarters plunged the company into the red and exhausted its cash flow. 
Last week, the company reported preliminary results for its fiscal fourth quarter. It reported net sales of roughly $1.2 billion and comparable store sales declining in the range of 40% to 50%. The company noted negative operating losses have continued, although it noted it hasn’t depleted its free cash flow.
The company reported $2.05 billion in revenue for the fiscal fourth quarter of 2021.
In February, it announced what was then-believed to be a Hail Mary stock offering that was expected to infuse more than $1 billion in equity into the company but it ultimately only raised $360 million, the company said. 
On March 30, Bed Bath announced another stock offering of $300 million and warned it would likely need to file for bankruptcy protection if it doesn’t work out.
The two offerings have diluted Bed Bath’s stock, which has been on a steady decline and hampered its fundraising efforts. The company’s shares have been trading around 35 cents. Its market value is $151.5 million, as of Tuesday’s close. More

Mortgage applications to purchase a home dropped 4% last week compared with the previous week.
New listings were down 20% year over year in March, according to Realtor.com, and total inventory was about half of what it was in March 2019, pre-pandemic.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased to 6.40% from 6.45%

A “For Sale” sign outside a house in Albany, California, on Tuesday, May 31, 2022.
David Paul Morris | Bloomberg | Getty Images

Mortgage rates fell last week, but demand for home loans didn’t move higher as a result. Other aspects of today’s housing market are outweighing the benefit of lower mortgage rates right now, namely a lack of supply.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.40% from 6.45%, with points falling to 0.59 from 0.62 (including the origination fee) for loans with a 20% down payment. It had been over 7% just a month ago.

Mortgage applications to purchase a home, however, dropped 4% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Demand was 35% lower than the same week one year ago.
“Spring has arrived, but the housing market is missing the customary burst in listings and purchase activity that typically mark the season. After four weeks of increasing purchase application activity, volume declined a bit this week even with another small drop in mortgage rates,” said Mike Fratantoni, MBA’s chief economist.
New listings were down 20% year over year in March, according to Realtor.com, and total inventory was about half of what it was in March 2019, pre-Covid pandemic.
“Although the mortgage rate for conforming balance loans declined by five basis points over the week to 6.40%, the mortgage rate for jumbo loans increased by nine basis points to 6.36%,” added Fratantoni. “While we have seen relative weakness at the high end of the housing market in recent months, the divergence in rates suggests that banks may be tightening credit in response to recent challenges, preserving balance sheet capacity as deposit balances have declined.”
Most jumbo loans are held on bank balance sheets.

Demand for Federal Housing Administration and Department of Veterans Affairs loans, which are favored by lower-income borrowers due to low down payment requirements, declined more than those for conventional loans. While there is strong demand from first-time homebuyers, with millennials hitting their peak buying age, affordability is still a challenge right now.
Applications to refinance a home loan also dropped, down 5% for the week and 59% lower than the same week a year ago. The refinance share of mortgage activity decreased to 28.6% of total applications from 29.1% the previous week. Rates are 150 basis points higher than they were at the same time last year, so there are precious few borrowers who can now benefit from a refinance. More

General Motors pulled ahead of Ford Motor to become the country’s second-best seller of electric vehicles during the first quarter.
GM on Monday said it sold 20,670 EVs during the first three months of the year. Ford, which was No. 2 last year, reported EV sales Tuesday of 10,866 over the same time frame.
GM still significantly trails Tesla in EV sales, though both GM and Ford have said they plan to overtake Tesla in EV sales in the years ahead.

DETROIT — General Motors pulled ahead of Ford Motor to become the country’s second-best seller of all-electric vehicles during the first quarter, trailing only industry leader Tesla.
GM on Monday said it sold 20,670 EVs during the first three months of the year. Ford, which was No. 2 last year, on Tuesday reported EV sales of 10,866 over the same time frame.

Motor Intelligence reports Ford’s EV sales during the first quarter dropped its ranking to fifth in the U.S. Hyundai Motor, which includes Kia, and Volkswagen also pulled ahead of Ford, according to the auto industry data firm.
Ford’s drop in rankings and sales was largely due to production down times at two of its North American plants that produce electric vehicles. Sales of its Mustang Mach-E fell 19.7% during the quarter, as it retooled a factory in Mexico to double its production capacity to 210,000 of the EVs per year. Ford also lost about five production weeks of its F-150 Lightning pickup due to a battery fire, which led to factory downtime and a small recall.
GM still significantly trails Tesla in EV sales. Motor Intelligence estimates Tesla, which does not report sales by region, sold 161,630 EVs in the U.S. during the first quarter.

Both GM and Ford have said they plan to overtake Tesla in EV sales in the years ahead. However, Elon Musk’s company is targeting significant expansion of its own EV production. Tesla previously said it expects to produce 20 million electric vehicles per year by 2030.
A majority of GM’s EV sales were of its Chevrolet Bolt models that start under $30,000. The cars feature older battery technology, called Ultium, than that of its newer, more expensive EVs, such as the GMC Hummer and Cadillac Lyriq.

GM confirmed Monday that it expects to build 50,000 EVs in the first half of 2023 and “double that” in the second half of the year, as Lyriq production ramps up and shipments of the electric version of the Chevrolet Silverado pickup begin later this spring.

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Ford is expanding production of its EVs as well, including plans, which it reconfirmed Tuesday, to expand production of the F-150 Lightning at a Michigan plant to an annual production run rate of 150,000 this year.
Ford has said it plans to achieve annual production capacity of 2 million EVs globally by 2026. GM has said it will hit that same threshold a year earlier.
— CNBC’s Phil LeBeau contributed to this report. More

Cuba will likely face more lawsuits over billions of dollars’ worth of unpaid commercial debts from the 1980s after a decision by a UK High Court judge.
The judge ruled mostly in favor of a fund that is seeking $72 million in principal and past due interest from Cuba.
The loans were granted to Cuba by European commercial banks in the 1980s, when Fidel Castro ruled the Caribbean nation, and were denominated in German Deutschmarks

A woman walks past a graffiti of the Cuban flag in Havana, on May 31, 2022.
Yamil Lage | AFP | Getty Images

Cuba will likely face more — and costlier — lawsuits over billions of dollars’ worth of unpaid commercial debts from the 1980s after a decision Tuesday by a UK High Court judge.
The judge ruled mostly in favor of CRF1, originally called the Cuba Recovery Fund. The fund filed suit against Cuba and its previous central bank, Banco Nacional de Cuba, in 2020 for roughly $72 million in principal and past due interest on two loans it now owns.

The loans were granted to Cuba by European commercial banks in the 1980s, when Fidel Castro ruled the Caribbean nation, and were denominated in German Deutschmarks, a currency that no longer exists.
Justice Sara Cockerill, who delivered Tuesday’s decision, oversaw a trial that started in late January and lasted two weeks and was beset by intrigue and chaos outside the UK High Court.  
That trial was about four issues: whether CRF could sue in the UK; whether the debts were properly transferred to the investment fund; whether the central bank could be sued; and whether the Cuban government was a guarantor on the debt and could be sued as well.
The judge ruled in favor of CRF on three of four of the issues. She said the High Court has jurisdiction, the debt was properly assigned to CRF, and that the former central bank is responsible.
Yet she ruled that Cuba itself is not a guarantor of the debt, a win for the communist nation.

David Charters, the CRF1 chair, described Cuba’s win as temporary, and based on a technicality. He said the fund on Tuesday filed once again with ICBC Standard Bank, the debt’s custodian, to have Cuba assigned as the guarantor. He said BNC has 28 days to respond and believes CRF will prevail.
“BNC was the Central Bank of Cuba and remains responsible for managing these unpaid Cuban debts,” he said. “Cuba won a technical point in this judgement which we have already remedied, and we do not expect this issue to impact the eventual final outcome, which is a complete victory for CRF.”
Lawyers for CRF said the fund can now proceed to a trial to determine whether it can recover “the sovereign debt that in unequivocally owns.

What the ruling means 

This trial was seen as a test case. CRF owns more than $1 billion in face value of Cuba’s defaulted debt. If CRF were to win on this small slice of Cuba’s total outstanding commercial debt, estimated at $7 billion, it could lead to lawsuits from CRF other debt holders.
The judge said Cuba’s description of CRF as a vulture fund “was not persuasive,” as the fund had made repeated attempts to settle with the Cuban government.
The judge also went to great lengths in the written judgement to emphasize that Cuba had withdrawn an accusation of bribery against one of CRF’s officers, Jeet Gordhandas. The judge said Gordhandas “has been damaged” as a result of the accusation.
If Cuba is ever to reenter the international capital markets, it will have to settle many outstanding debts.
“Cuba owes money, lots of money, to CRF, to governments, to companies, and $1.9 billion in 5,913 certified claims” to U.S. entities whose assets were seized during Fidel Castro’s communist revolution, said John Kavulich, longtime head of the U.S.-Cuba Trade and Economic Council. “Successive governments of Cuba have not been absolved by the decision of the court.”
The judge’s ruling also revealed more about the behind-the-scenes negotiations the fund attempted over the years. In March of 2021, the fund offered Cuba a zero-coupon instrument, with no principal payments for five years. In November of 2017, CRF offered to exchange “the balance of commercial debt for licenses, concessions and/or permits for large investment projects, in accordance with the priorities established in the portfolio of opportunities published by the Cuban government.”
Charters, the CRF chairman, said the fund would still prefer a negotiated solution rather than litigation.
“CRF remains committed to finding a solution with Cuba that has zero impact on its budget for at least 5 years, recognizing the difficult economic situation the country is facing,” he said. “We believe that a mutually beneficial solution can be reached through constructive dialogue and cooperation.”
Cuban officials declined to comment despite repeated requests. The Cuban government did publish an article in its state-run newspaper, Granma, with the headline: “Republic of Cuba wins lawsuit in London: CRF is not a creditor of the Cuban State.”
However, the article goes on to acknowledge that Banco Nacional de Cuba will be subject to litigation. More

Johnson & Johnson said it would pay an $8.9 billion settlement over claims that its talc-based baby powder caused cancer.
The company ended sales of the powder as it faced thousands of lawsuits over the alleged health hazards.
J&J continued to dismiss the claims, despite its proposed settlement.

Containers of Johnson’s baby powder made by Johnson and Johnson are displayed on a shelf on July 13, 2018 in San Francisco, California.
Justin Sullivan | Getty Images

Johnson & Johnson on Tuesday said it will pay $8.9 billion over the next 25 years to settle allegations that the company’s baby powder and other talc products caused cancer.
The company announced the proposed settlement in a securities filing. J&J’s subsidiary LTL Management also refiled for Chapter 11 bankruptcy protection after its first attempt was thwarted, the filing said.

More than 60,000 claimants have committed to support the proposed resolution, which would require approval in bankruptcy court, the filing added.
“Resolving this matter through the proposed reorganization plan is both more equitable and more efficient, allows claimants to be compensated in a timely manner, and enables the Company to remain focused on our commitment to profoundly and positively impact health for humanity,” said Erik Haas, J&J’s worldwide vice president of litigation, in a statement.
But J&J still pushed back on the talc allegations. 
“The Company continues to believe that these claims are specious and lack scientific merit,” Haas added.
The company ended sales of its talc-based baby powder globally this year after it faced thousands of lawsuits from customers claiming its talc products caused cancer due to contamination with the carcinogen asbestos.

J&J spun off LTL management in October 2021 in a bid to reduce its losses from litigation and settlement. The company funneled its talc lawsuits to the subsidiary and immediately filed for bankruptcy protection.
A judge affirmed J&J’s ability to use the Chapter 11 strategy in February 2022.
But the U.S. Court of Appeals for the 3rd Circuit overturned the ruling in January this year, saying neither LTL nor J&J had a legitimate need for bankruptcy protection because they were not in “financial distress.”
Leigh O’Dell, one of the lead attorneys representing plaintiffs in the talc lawsuits, told CNBC at the time that the ruling was another step toward ending J&J’s “attempted abuse of the bankruptcy system.”
O’Dell on Tuesday said in a statement to CNBC that J&J is “seeking an extremely deep discount on justice and is not really offering anything other than another bankruptcy and more delay, delay, and delay.
“This new filing should be viewed as a shameful attempt to run out the clock on people dying of cancer and convince some lawyers to give up,” she said.
Mikal Watts, one of the plaintiff lawyers who negotiated the proposed settlement, said J&J committed to “fairly compensate these deserving women” who have battled cancer due to the talc products. “Our job is to get our clients fairly paid for their injuries, and this settlement is the culmination of a job well done.”
J&J said last month it would take the case to the Supreme Court.
The company paid $7.4 billion in litigation expenses between 2020 and 2021, according to an annual filing. The company said talc litigation was a primary diver of legal costs during those years. More

The Department of Justice charged Charlie Javice, founder of college financial-planning platform Frank, with defrauding JPMorgan Chase of $175 million. 
Javice, 31, is accused of “falsely and dramatically” inflating the number of customers Frank actually had in a scheme to “fraudulently induce” JPMorgan to acquire the startup.
The Securities and Exchange Commission also sued Javice in connection with the alleged scheme. 

Charlie Javice, Founder/CEO of Frank, which is a college financial aid start-up.
Source: JP Morgan

The Justice Department on Tuesday criminally charged Charlie Javice, founder of college financial-planning platform Frank, with defrauding JPMorgan Chase out of $175 million. 
Javice, 31, is accused of “falsely and dramatically” inflating the number of customers Frank actually had in a scheme to “fraudulently induce” the bank to acquire the startup in 2021, federal prosecutors in Manhattan said. She stood to gain more than $45 million from the alleged deception, they added. 

The one-time rising tech star — who was once named as one of Forbes’ 30 Under 30 — was arrested Monday night in New Jersey and is expected in Manhattan federal court Tuesday afternoon.
She faces four counts. They are one count of conspiracy to commit bank and wire fraud, one count of wire fraud affecting a financial institution, one count of bank fraud, and one count of securities fraud. Three of the charges each carry a maximum sentence of 30 years in prison. 
“This arrest should warn entrepreneurs who lie to advance their businesses that their lies will catch up to them, and this Office will hold them accountable for putting their greed above the law,” Damian Williams, U.S. Attorney for the Southern District of New York, said in a statement.
The Securities and Exchange Commission on Tuesday also sued Javice for fraud in connection with the alleged scheme. 
“Charlie denies the allegations,” a spokesperson for her attorney, Alex Spiro, told CNBC. Spiro had no additional comments, the spokesperson said.

JPMorgan did not immediately respond to a request for comment. The bank’s CEO, Jamie Dimon, in January called the acquisition of Frank a “huge mistake.”
The charges come months after JPMorgan filed a lawsuit against Javice alleging she duped the bank into believing Frank had more than 4 million customers. In reality, the startup had fewer than 300,000, JPMorgan said in its suit. 
Javice used a data science professor to invent millions of fake accounts after JPMorgan pressed for confirmation of Frank’s customer base, the bank alleged. The suit included emails between the professor and Javice, including when the entrepreneur asked, “Will the fake emails look real with an eye check or better to use unique ID?” 
JPMorgan only discovered the discrepancy when 70% of emails sent to a batch of about 400,000 Frank customers bounced back, according to the bank. It shut down the startup in January. 
Javice in February filed a counterclaim, saying it was “implausible” that JPMorgan “was led to believe Frank had 4.25 million registered users when its website publicly claimed the company had helped more than 350,000 people access financial aid.” More

Virgin Orbit’s outgoing Chief Operating Officer Tony Gingiss had some choice words for company leadership in a companywide email.
Gingiss’ email appears to call out Virgin Orbit CEO Dan Hart, although not by name, and offers an apology to employees that they “have not heard from the person who should be saying it.”
Virgin Orbit filed for Chapter 11 bankruptcy protection on Tuesday. The company noted in a securities filing that Gingiss was laid off as one of the 675 positions eliminated.

The modified 747 aircraft “Cosmic Girl” lifts off from Mojave Air and Space Port in California carrying a LauncherOne rocket on June 30, 2021.
Virgin Orbit

With Virgin Orbit now under bankruptcy protection, departing Chief Operating Officer Tony Gingiss had some choice words for the company’s leadership, as well as a lengthy and detailed apology to its employees.
“You deserved better than this!” Gingiss wrote in a companywide email on Monday, which was obtained by CNBC.

“You have been part of something audacious, challenging, and fulfilling [but] … You simply did not have the leadership or opportunity to demonstrate to the world what you can fully do and how this product could be an enduring force in the market,” Gingiss said.

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Virgin Orbit filed for Chapter 11 bankruptcy protection on Tuesday after ceasing operations last week. The company noted in a securities filing that Gingiss was laid off as one of the 675 positions eliminated.
Gingiss’ email appears to call out Virgin Orbit CEO Dan Hart, although not by name, and offers an apology to employees that they “have not heard from the person who should be saying it.”
“I’m sorry that I was not able to convince our leader and board to take a different path to give us more time to figure things out,” Gingiss said in the email.
A Virgin Orbit spokesperson did not immediately respond to CNBC’s request for comment.

Read the full email from Gingiss:

Dear Virgin Orbit and Virgin Orbit National Systems current and former employees,
Like many of you, today is my last day at Virgin Orbit. The last 26 months I spent as your COO have a lot positives for me including; learning how we build our rocket, working with a multi-talented team to do so, successfully launching 3 rockets and delivering our Customers into orbit, making new friends and colleagues, and experiencing a challenging and team-building Spaceport Cornwall first launch campaign to name a few.  Thank you for everything you gave to me personally and to the dream of Virgin Orbit.  I appreciate it and, I appreciate you!  That said, we are at a crossroads and I wanted to say…
You deserved better than this!
I don’t say this lightly as I know the current situation is emotionally, mentally and financially challenging for many of us.  You have been part of something audacious, challenging, and fulfilling … you created an entirely new air-launch system that has a unique, responsive, anywhere (including Spaceport Cornwall), anytime, unwarned capability that there is definitely a market for, and demonstrated it worked 4 (almost 5) times! You simply did not have the leadership or opportunity to demonstrate to the world what you can fully do and how this product could be an enduring force in the market.
I want to say something to you, that you have not heard from the person who should be saying it, so I will … I’m sorry and I apologize:
· I’m sorry that I was not able to help us avoid this outcome
· I’m sorry we didn’t act sooner and avoid surprising you and so many of our supporters and customers with this abrupt finale
· I’m sorry that we didn’t prioritize our people and financial resources better
· I’m sorry that you have to bear the burden of being out of a job, one that I know many of you loved and that fed you both literally and figuratively
· And for me, I’m sorry that I was not able to convince our leader and board to take a different path to give us more time to figure things out
· I’m sorry and I apologize, plain and simple … you deserved better!
We ended up where we are despite my best efforts to affect our path forward.
This chapter is now done, but our book is not finished. I know what a talented team you are as most of you were part of my Engineering and Operations team and the rest of you worked so closely with us, as our partners, to do the amazing things we have done.  I know what good people you are and how big of an impact you have made and will continue to make.  Please take away all of the good experience, knowledge, memories, skills, and relationships that you have gained at VO.  Go boldly onto your next adventure and bring that special you that you brought to Virgin Orbit.  While we did not succeed in the endeavor of making Virgin Orbit a force in the industry we must use this event to spread the ripple of our talents, dreams, creativity and energy into the industries and world to make them a better place.  In this way, on some level, it will all be worth it.
It has been my fortune and privilege to be your COO and colleague.  I wish you the best in whatever your next chapter is. I stand here ready and willing to help in any way I can; a shoulder to cry on (but I’ll tell you to shake it off ;-), a hand to help, a recommendation to give, a drink to share, another adventure to have … whatever.  Reach out to me if I can help in some way and God-speed in whatever path you choose to take.
“Second star to the right, and straight on ’til morning!”
Per ardua ad astra …
With my best regards and until we meet again!
Tony More

About 5,000 white-collar workers at General Motors opted to participate in a buyout program that was announced last month.
GM CFO Paul Jacobson said Tuesday the automaker expects to take a roughly $1 billion charge during the quarter as a result of the program.
GM CEO Mary Barra last month said if not enough employees participated in the program, the automaker may have needed to resort to layoffs.

A GMC pickup truck is displayed for sale on a lot at a General Motors dealership on January 05, 2023 in Austin, Texas.
Brandon Bell | Getty Images

DETROIT – About 5,000 white-collar workers at General Motors opted to participate in a buyout program that was announced last month to lower the automaker’s global head count and fixed costs.
GM CFO Paul Jacobson said Tuesday the company expects to take a roughly $1 billion charge during the quarter as a result of the program. The head count reduction was part of GM’s plans to cut $2 billion in structural costs by the end of 2024.

Jacobson said the opt-in rate for the “Voluntary Separation Program” was in line with company expectations, and puts GM “in a position” to avoid layoffs.
“I think we’re in a position where we’re going to be able to do that,” he said Tuesday during a BofA Securities conference.
GM expects the majority of employees who participated in the program to leave the company by the end of June, according to a spokesman.
GM CEO Mary Barra last month said if not enough employees participated in the program, involuntary actions would need to be taken.
The buyouts were offered to a majority of the company’s 58,000 U.S. white-collar employees. To qualify for the program, salaried employees needed to have worked at the company for five years as of June 30 this year. For executive-level employees, the qualification was two years worked.

“This was a tool to get us to really accelerate the attrition curve; got a pretty quick payback,” Jacobson said.
GM announced the $2 billion cost-cutting program in January, saying between 30% and 50% of the savings were expected during 2023. At the time, executives said they were planning head count reductions through attrition rather than layoffs.
Jacobson said Tuesday that GM will likely now come in on the “higher end” of that percentage range for 2023. “We feel like we’ve gotten off to a really good start on it,” he said.
GM last month said it expected to take a pretax charge of up to $1.5 billion related to the buyouts, according to a public filing. The majority of the charges are expected to be all cash and occur during the first half of the year, the company said.
GM is “working through” the full extent of the charges, Jacobson said, and may see costs spill over into the second quarter.
The company will offer additional details about the buyout program during its first-quarter earnings call on April 25, Jacobson said.
Shares of the company were down about 2% in midday trading. More