Gymboree

Gymboree Corp. on Sunday said it struck an agreement with lenders that will send the children’s retailer to court to restructure under Chapter 11 bankruptcy.

“We expect to move through this process quickly and emerge as a stronger organization that is better positioned in today’s evolving retail landscape, with the right size store footprint and greater financial flexibility to invest in Gymboree’s long-term growth,” said Gymboree ceo and president Daniel Griesemer in a statement.

The company had 1,281 stores as of April 29. The majority, 582 doors, are comprised of the company’s namesake store with the balance comprised of Gymboree’s outlets, Janie and Jack and Crazy 8.

Chief financial officer Andrew North plans to step down for what the company said are personal reasons, staying on as a consultant for an unspecified amount of time. Liyuan Woo, the former cfo of Bebe and current AlixPartners director, will serve as interim cfo.

The bankruptcy filing was largely expected after the company said earlier in the year it would not be making an interest payment due at the beginning of June. The missed payment triggered a ratings downgrade from Moody’s Investors Service, which lowered the company’s corporate family rating to “Ca.” That followed action taken by S&P Global Ratings on Gymboree’s corporate credit rating from “CC” to “D.”

The San Francisco-based retailer, which was acquired by private equity firm Bain Capital in 2010 for $1.8 billion, said the restructuring process would allow it to trim more than $900 million in debt.

The agreement with lenders includes as much as $308.5 million of debtor-in-possession financing, including $35 million in new money from existing lenders.

The company listed assets of $755 million in its bankruptcy petition, along with debt totaling $1.4 billion.

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