Gymboree amended plan of reorganization confirmed by bankruptcy court

By Caroline Salls

Pittsburgh, Sept. 7 – Gymboree Corp.’s amended plan of reorganization was confirmed Thursday by the U.S. Bankruptcy Court for the Eastern District of Virginia.

As previously reported, the company filed bankruptcy to implement an agreement reached with a majority of its term loan lenders on the terms of a comprehensive financial restructuring and recapitalization.

The pre-negotiated restructuring includes a roughly $1 billion reduction in debt, an infusion of up to $115 million of new money through both a term loan debtor-in-possession financing facility and an up to $80 million fully backstopped rights offering and a rationalization of the company’s retail footprint.

Term loan lenders who contribute their share of the new-money DIP term loan facility and the rights offering will obtain the benefit of a $70 million DIP term loan facility roll-up and ultimately share in newly issued common shares.

Additional new Gymboree common shares will be distributed to the consenting term loan lenders who have agreed to backstop the rights offering.

Non-participating term loan lenders will also receive their share of new Gymboree common shares.

Holders of general unsecured claims will receive a share of $4.5 million in cash.

Holders of critical trade claims necessary to the reorganized company’s business plan will be paid in full in cash.

All existing interests in Gymboree will be extinguished.

Gymboree, a children’s apparel specialty retailer based in San Francisco, filed for bankruptcy on June 11. The Chapter 11 case number is 17-32986.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.