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Centric moved quickly from first-day stabilization into plan prosecution, filing the Third Amended Joint Chapter 11 Plan on July 24 and then the Fifth Amended Joint Chapter 11 Plan on September 18 source filing source filing. The restructuring followed the RSA economics previewed at filing: the $275 million DIP revolver and $160 million DIP term loan would convert into exit financing, first-lien term lenders would receive exit debt plus 30% of reorganized equity, and second-lien term lenders would receive 70% of reorganized equity source filing.
The court entered findings, conclusions, and an order confirming the Fifth Amended Joint Chapter 11 Plan on September 21, after a docket that included landlord, contract-counterparty, insurer, logistics, and technology-company objections around confirmation and assumption issues source filing. For restructuring professionals, the confirmation order locked in a lender-owned recapitalization less than five months after filing, turning a pandemic-driven liquidity case into an exit-financing and post-confirmation claims-administration matter.
Centric Brands Inc. filed Chapter 11 in the Southern District of New York with Ropes & Gray as debtor counsel, reporting $1.856 billion of assets and $2.014 billion of liabilities as of March 31, 2020, and board authority to enter a restructuring support agreement with consenting creditors and shareholders source filing. CFO Anurup Pruthi described the business as a global lifestyle brand collective across kidswear, accessories, and men's and women's apparel, managing more than 100 licensed and owned brands including Calvin Klein, Tommy Hilfiger, Under Armour, Kate Spade, Michael Kors, Disney, Marvel, Nickelodeon, Hudson, Robert Graham, SWIMS, and Zac Posen; major customers included Walmart, Macy's, Kohl's, TJX, Costco, Nordstrom, Ross, Target, JCPenney, and Amazon source filing.
The filing was driven by the COVID-19 shock: all U.S. stores temporarily closed beginning March 19, 2020, fiscal 2020 net sales losses were projected to exceed $700 million, and the company had furloughed about 1,346 employees plus cut about 660 jobs by April 1 from a U.S. workforce of roughly 2,119 source filing. CRO Joseph Sciametta said the cases launched around an RSA, $435 million of proposed DIP financing, and a transaction expected to reduce more than $700 million of prepetition debt source filing.
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