KNOXVILLE, Tenn (WVLT) -- Goody's has begun the process of closing its Knoxville, Tennessee, distribution and corporate offices by laying off most of its associates.

VolunteerTV.com broke the story around 9:45 a.m. after a Goody's manager with knowledge of the situation told us he had been told he and his entire staff are being fired today.

That manager said most other departments are doing the same, and a small number of people will be retained to help with the liquidation, then be out of a job too.

According to a termination letter obtained by WVLT-TV, 572 employees work at the Goody's corporate office and the distribution center. An exact number of layoff was not released by the company, but sources say "most" will be laid off today.

Goody's held meetings at the corporate offices on Parkside Drive at 9, 10, and 11 am on Monday. After the meeting, many employees could be seen leaving the company property.

The termination letter says terminated employees did not have to leave right after the meeting, but their company badges would be deactivated tonight.

Volunteer TV News crews were twice escorted off the property while trying to interview affected workers.

Goody's spokesperson Joanna Gager says on her corporate answering machine that she is on maternity leave and her voice mail would not accept messages. Repeated attempts to contact Gager since liquidation was announced on Friday have been unsuccessful.

According to an employee termination letter obtained by WVLT-TV, Goody's plans to file for Chapter 7 bankruptcy in U.S. Bankruptcy Court in Delaware on Tuesday, January 13th. Chapter 7 governs the process of liquidation.

The first terminations were to begin today, or within fourteen days, according to the letter. The termination letter says all employees will learn their termination date within 14 days. Our source says most people would be terminated today.

The entire facility closure, according to the letter, won't be complete until at least March 16th, 2009, and a small numbers of employees will remain employed until that date.

No severance payments are being handed out, and all medical, dental, life and disability benefits end Monday night at midnight.

"We have made every effort to stabilize and preserve the business, but unfortunately, as announced today Goody's has determined that it is not able to continue operations and is beginning the orderly discontinuation of operations," according to CEO Paul White's letter.

"We wish we could have provided you more notice but it has become obvious only in the past few days that our efforts at preserving our business have failed," White continued.

Goody's Family Clothing operates 287 department stores across the U.S., mostly in the southeast. The company employed about ten thousand workers at the end of 2008.

Stay connected to Volunteer TV News and VolunteerTV.com for continued coverage of this developing news story.