Specialty chain Dots has filed a voluntary Chapter 11 petition for bankruptcy court protection.
The petition was filed in a Newark bankruptcy court under the corporate name Dots LLC. The company said it will pursue a restructuring plan that includes the sale of the company as a going concern. The petition also estimated $50 million to $100 million in assets, and $100 million to $500 million in liabilities.
Dots has secured a commitment of $36 million in debtor-in-possession financing from Salus Capital, its existing lender. The retail chain has also shuttered more than 30 underperforming stores, and will continue to evaluate the possibility of additional store closures over the next few months. The company, which targets the women ages 25 to 35 in the value price distribution channel, has 1,250 full-time employees and 2,250 part-time staffers.
Lisa Rhodes, the retail chain’s chief executive officer, said in a statement filed with the bankruptcy court that “prior management instituted a number of new merchandising strategies and operational tactics that resulted in a downturn in store traffic and overall financial performance” in the fourth quarter of 2011, and that the chain’s financial issues were exacerbated by “adverse economic conditions,” as well as a burdensome lease portfolio.
Rhodes said the new management team, hired in the second half of 2012, has instituted a repositioning strategy, and that the retailer is still in turnaround mode. While Irving Place Capital, which acquired the company in 2011, has “devoted significant resources to fund the company’s operations and cash needs,” Dots continues to face hurdles regarding meeting cash and noncash obligations, she said.
The ceo added that Dots’ liquidity became strained in October when some vendors and factors either shortened the time frame for payment for goods or began demanding payment upon delivery.
Dots hired consulting firm PwC and legal counsel Lowenstein Sandler in December to evaluate strategic options, including the sale of the company.
For the fiscal year ended Jan. 31, 2013, Rhodes said Dots posted $338.8 million in sales, versus $346.2 million in the same 2012 period. That compares with the $293.7 million sales estimate for the year ending Jan. 31, 2014.
The top 10 unsecured creditors are Robert A. Glick, Chagrin Falls, Ohio, noteholder in the amount of $14.1 million; CIT Group, New York, $1.7 million; Wells Fargo, Woburn, Mass., $1.1 million; Hana Financial Inc., Los Angeles, $929,901.88; Heart & Hips, Vernon, Calif., $831.131.51; Rosenthal & Rosenthal, New York, $698,790.28; Merchant Business Credit, New York, $544,810.36; Finance One Inc., Los Angeles, $533.227.76; Jacmel Jewelry Inc., Long Island City, N.Y., $495,278.15, and Land N Sea, New York, $426,634.24.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast