Home / Knowledge / News / Apparel/Garments / American Apparel secures new credit line
American Apparel secures new credit line
14
Mar '12
American Apparel Inc, a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel, announced it has replaced its existing $75 million senior credit facility that was due to expire in July 2012 with a three year $80 million Senior Credit Facility with Crystal Financial LLC as Administrative Agent and Salus Capital Partners, LLC as Documentation Agent.

In addition, the Company has amended and extended the maturity of its second lien credit facility with Lion Capital, LLP and affiliates.

These actions, when taken together, will provide the Company with additional borrowing capacity and financial flexibility as it continues to build upon recent positive momentum in its business.

The Credit Facility is composed of a $30 million term loan with the balance of the commitment being provided as revolving credit. Borrowings are at 900 basis points over the LIBOR rate and are secured by substantially all of the assets of the Company. The Credit Facility matures on March 13, 2015.

The Company has also extended the maturity date of the Second Lien Loan by two years to December 31, 2015, and has negotiated an easing of the minimum EBITDA financial covenant of the Second Lien Loan. In addition, the Company has agreed that with respect to interest accruing from and after September 1, 2012, it will pay a minimum of 5% of each interest payment on outstanding principal under the Second Lien Loan in cash.

In connection with the extension, the Company agreed that if it fails to maintain specified minimum quarterly EBITDA targets as defined in the extension amendment the exercise price of Lion's outstanding warrants will be reduced by $0.25. The Company also extended the maturity of the warrants by four years.

Comment of Dov Charney, Chairman and CEO of American Apparel, Inc.
"These financial agreements, coupled with improved financial performance, will provide added flexibility in delivering upon our operating plan for 2012 and beyond. We have made steady progress in building sales and improving our financial performance in the past year; securing the refinancing of our debt should provide our stakeholders with confidence about our ability to continue our momentum and deliver upon our commitments. We have significant goals for our 2012 performance and so far we are off to a good start.

Crystal Financial has significant retail experience, understands our business and has an appreciation of the significance of the recent improvements in our operating performance. We are fortunate to have them as a new business partner. Also, the vote of confidence and support from Lion Capital by way of the loan extension and other accommodations is also significant. We truly value their partnership."

Comment of Stephen Krawchuk, Managing Director of Crystal Financial LLC
"American Apparel has made great strides over the past year in improving its overall financial performance and we are pleased to be in a position to provide them with the financial flexibility needed to continue to build upon that momentum. The transactions announced today will provide an immediate benefit to American Apparel and we look forward to a long and mutually beneficial relationship with the Company."


Must ReadView All

Apparel/Garments | On 26th Sep 2017

US raises annual AGOA quota for textiles

The US Committee for the Implementation of Textile Agreements has...

Textiles | On 26th Sep 2017

Thrace-LINQ expanding Dorchester County operations

Thrace-LINQ, a global supplier of fabrics for the textile industry,...

Courtesy: Levis

Fashion | On 26th Sep 2017

Google unveils smart denim jacket with Levi Strauss

Ending the months-long wait, Google has unveiled its smart denim...

Interviews View All

Yashiki Gumber
Sahiba Fabrics

Fabric does not restrict us from fashion trends

Karan Suratwala
Key Textile Accessories Private Limited

Chinese imports are destroying the supply chain

Giovanni Pizzamiglio, Paolo Crespi & Riccardo Robustelli
Epson, For.Tex & F.lli Robustelli

‘The percentage share of printing in the global textile market is pretty...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Steve Cole
Xerium Technologies

Steve Cole of Xerium Technologies discusses the industry. Xerium is the...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

September 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
75.5%
No
12.2%
Skip
12.2%

Total Votes: 49

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
63.3%
No
24.5%
Skip
12.2%

Total Votes: 49

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.8%
No
6.1%
Skip
6.1%

Total Votes: 49

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
71.4%
No
10.2%
Skip
18.4%

Total Votes: 49


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search