Shares of American Apparel Inc. got a boost Friday after the firm said lenders granted it a three-month extension on debt due to mature next month, and that the retailer has seen promising holiday sales.
According to a filing with the Securities and Exchange Commission dated Friday, the Los Angeles-based firm received an extension of its credit facilities with lender SOF Investments, which now have a maturity date of April 20. The debt was due on Jan. 18.
“We are pleased to have secured these extensions to our loan maturities given the current difficulties in the credit markets,” said chairman and chief executive officer Dov Charney. “Our business has remained encouraging during the holiday season.”
Charney added the extension will give the company time to pursue longer-term agreements with its lenders or consider financing alternatives.
For the third quarter ended Sept. 30, the company listed total liabilities at $196.3 million.
The amendment to the SOF deal permits the company to raise additional equity and enter into up to $15 million worth of lease-buyback transactions, as well as increase its unsecured indebtedness. If the credit agreement is further extended, the company’s capital expenditures are limited to $9.3 million in the first quarter of 2009 and about $8.5 million over the rest of the year.
In order to secure the extension, American Apparel paid SOF a fee of $2.6 million and issued the lender warrants to buy one million shares of company stock at $3 a share. If the company fails to raise $16 million in financing by March 13, SOF is entitled to warrants to purchase another two million shares at the same price.
The company has a separate credit agreement with Bank of America that could become due March 21, 2009, if the SOF agreement is neither extended nor renewed.
American Apparel stock surged nearly 40 percent in midday trading Friday before closing at $2.30, up 3.1 percent.
@margotrobbie steps out onto the red carpet wearing @miumiu. The actress is nominated for “Outstanding Performance by a Female Actor in a Leading Role” in “I, Tonya” at the #SagAwards. (📷: Stewart Cook) #wwdfashion
For @massimogiorgetti of @msgm, the Nineties are his favorite decade. “They had a huge impact on my personal growth. What I like of the Nineties is that they are not so precise in terms of style as other decades…there was actually a bit of everything,” he said. As seen on MSGM’s Spring 2018 show: tie-dye and a bit of grunge, two styles that are synonymous with the decade #wwdfashion #wwddecades (📷: @kukukuba)
Breaking News: @hedislimane joins @celine as its new artistic, creative and image director. One of fashion’s preeminent image-makers and trendsetters, Slimane is to join the LVMH brand on Feb. 1 and unveil his first fashion proposition for men and women next September during Paris Fashion Week. It marks a major homecoming for Slimane, who cemented his reputation – and influenced men’s tailoring for more than a decade – as the designer of Dior Homme between 2000 and 2007. He went on to reinvent and ignite the house of Yves Saint Laurent, which he rechristened Saint Laurent, between 2012 and 2016 – all the while maintaining a close relationship with the Arnault family, which controls LVMH and Dior. Read the full exclusive story on WWD.com. Link in bio. #wwdnews #wwdfashion
“Personally I believe the Eighties have been the richest and more vivacious period for international fashion,” Giorgio Armani said when asked what his favorite decade of fashion is. It was a moment of disruption and experimentation and only thinking back to the first years of that decade is always an emotion for me, for what they have meant to me and my work.” The influence is clear in @giorgioarmani spring 2018 collection, pictured here, which was full of bright colors and unexpected prints. Read more about which decades designers loved most on WWD.com #wwdfashion #wwddecades (📷: @aitorrosasphoto)
For Lady Gaga’s only Italian show on her “Joanne World Tour,” the singer wore a range of @versace_official outfits. The standout piece: this custom-made bodysuit inspired by the brand’s spring 2018 collection. #wwdfashion (RG: @ladygaga)
@_camillaruth_ is expanding on the wellness-craze concept with @westbourne – a new NYC restaurant that’s both a healthy-minded café as well as a business that gives back to the community. Marcus works with the Robin Hood foundation to give back to The Door, a non-profit providing youth development services, and also hires employees through The Door. Read our full interview with Marcus on giving back through food on WWD.com. #wwdeye (📷: @lexieblacklock)