By guest author Samantha McDonald from Footwear News
J.Jill Inc. has managed to avoid filing for bankruptcy.
The struggling womenswear retailer announced late last night that it has obtained the necessary consents from its term loan lenders to move forward with an out-of-court restructuring transaction. According to a statement, the agreement not only frees the company from its financial covenants, but also extends certain debt maturities and provides its business with additional liquidity to continue operations amid the coronavirus pandemic.
With the deal, J.Jill is able to defer certain debt payments to 2024 and waive all existing non-compliance with the terms of its credit facilities. It has also been granted a financial covenant holiday until the fourth quarter of 2021 and received a new cash infusion of USD 15 million in the form of a junior term loan. It is expected to close on or about Sept. 30.
“The transaction provides J.Jill with the financial flexibility to continue to meet its obligations to its vendors in full and continue to execute on its business plan,” the company added in a press release.