By  on August 30, 2019

Barneys New York has fervently touted its $217 million in debtor-in-possession financing arrangement as its ticket out of bankruptcy, but top creditors including Prada USA Corp. and Chloé aren’t convinced the terms won’t simply push the retailer into liquidation.

On Friday, the official unsecured creditors’ committee sounded alarm bells over what it characterized as “predatory” terms of the financing by Brigade Capital Management LP and B. Riley Financial Inc. They took aim at the various fees and interest payments involved in the arrangement, especially an “enhancement fee” of 37.5 percent of any sale proceeds that would be left over after paying off the DIP loans and other costs.

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