Item 1.01 Entry into a Material Definitive Agreement.
The information included in Item 1.03 herein is incorporated by reference in
this Item 1.01.
Item 1.02 Termination of a Material Definitive Agreement.
Prepetition Indebtedness
Pursuant to the Plan, on the Effective Date, the obligations of the Debtors
under (a) that certain First Lien Credit Agreement, dated as of October 29, 2018
(as amended by (i) that certain Amendment No. 1 and Waiver to Credit Agreement,
dated as of April 17, 2019, (ii) that certain Amendment No. 2 and Waiver to
Credit Agreement, dated as of April 20, 2020 and (iii) that certain Amendment
No. 3 and Waiver to Credit Agreement, dated as of May 11, 2020), by and among
the Company (f/k/a Differential Brands Group Inc.), as borrower, the lenders
from time to time party thereto, the First Lien Revolving Agent, the First Lien
Term Loan Agent and HPS Investment Partners, LLC, as documentation agent,
(b) that certain Second Lien Credit Agreement dated as of October 29, 2018 (as
amended, by (i) that certain Amendment No. 1 and Waiver to Credit Agreement,
dated as of April 17, 2019, (ii) that certain Amendment No. 2 and Waiver to
Credit Agreement, dated as of April 20, 2020 and (iii) that certain Amendment
No. 3 and Waiver to Credit Agreement, dated as of May 11, 2020) by and among the
Company (f/k/a Differential Brands Group Inc.), as borrower, the lenders party
thereto, and U.S. Bank National Association, as administrative agent and
collateral agent, (c) all contracts, instruments, indentures, and other
agreements or documents created in connection with those certain Convertible
Promissory Notes, dated October 29, 2018, issued by the Company to funds managed
by GSO Capital Partners LP and funds managed by Blackstone Tactical
Opportunities Advisors L.L.C., (d) all contracts, instruments, indentures, and
other agreements or documents created in connection with those certain
Subordinated Convertible Promissory Notes, dated January 28, 2016, issued by the
Company pursuant to that certain Rollover Agreement, dated as of September 8,
2015 among Joe's Jeans Inc. and each of the noteholders party thereto, (d) that
certain Amended and Restated Purchase and Sale Agreement, dated May 20, 2020,
among the Company, as Servicer, certain subsidiaries of the Company, as
Originators and Spring Funding, LLC, as Buyer, and (e) that certain Amended and
Restated Receivables Purchase Agreement, dated May 20, 2020, among Spring
Funding, LLC, as Seller, the Company, as initial Servicer, certain purchasers
party thereto, PNC Bank, National Association as Administrative Agent, and PNC
Capital Markets LLC, as Structuring Agent, were released and discharged.
Equity Interests
In accordance with the Plan and Confirmation Order, on the Effective Date, all
shares of Centric Brands Inc.'s common stock issued and outstanding immediately
prior to the Effective Date, and any rights of any holder in respect thereof,
were deemed cancelled, discharged and of no further force or effect.
. . .
Item 1.03 Bankruptcy or Receivership.
The information set forth in the explanatory note is incorporated by reference
into this Item 1.03.
New Exit Facilities
On the Effective Date, Reorganized Centric entered into that certain new exit
term credit agreement (a) by and among Reorganized Centric, as borrower, Ares
Capital Corporation as administrative agent (the "Administrative Agent"), ACF
Finco I LP as revolving agent and collateral agent (the "Collateral Agent"), HPS
Investment Partners, LLC as documentation agent, and the lenders from time to
time party thereto (as so executed and delivered, the "Exit First Lien Credit
Agreement"), (b) the Collateral Agreement, among Reorganized Centric and certain
of Reorganized Centric's subsidiaries as Grantors (as defined therein) and the
Collateral Agent and (c) the Guaranty Agreement among Reorganized Centric,
certain of Reorganized Centric's subsidiaries as Guarantors (as defined therein)
and the Administrative Agent, which Exit First Lien Credit Agreement established
(a) a senior secured revolving credit facility (the "Exit Revolving Facility")
in an aggregate committed amount of up to $275,000,000.00 (the loans thereunder,
the "Exit Revolving Loans") and (b) a senior secured first lien term loan
facility ("Exit Term Facility") in an aggregate principal amount of
$824,923,865.50 (the loans thereunder, the "Exit Term Loans").
Reorganized Centric will use the proceeds of the Exit Term Loans to fund fees,
costs and expenses incurred in connection with the Exit First Lien Credit
Agreement and the Transactions and to finance the repayment, redemption or
discharge of, and termination of all obligations and commitments under certain
indebtedness of the Debtors. Reorganized Centric will use the proceeds of the
Exit Revolving Loans for working capital needs and other general corporate
purposes.
New Receivables Facility
On the Effective Date, Reorganized Centric entered into a two-year trade
receivables securitization facility (with an option to extend) pursuant to
(a) that certain Receivables Credit Agreement among Spring Funding II, LLC, a
Delaware limited liability company ("Spring Funding II"), as Borrower,
Reorganized Centric, as Master Servicer, Centric Commercial Funding LP, as the
Initial Lender, the other Lenders from time to time party thereto and U.S. Bank,
National Association, as Administrative Agent (the "Agent"), (b) the Purchase
and Sale Agreement among Spring Funding II, as buyer, Reorganized Centric as
Master Servicer, and the Sellers (as defined therein) party thereto, (c) the
Canadian Purchase and Sale Agreement, among Spring Funding II, as buyer, the
Company, as Master Servicer, and Centric Canada Apparel & Accessories ULC as
Canadian seller, and (d) the Performance Guaranty, dated on or around the date
hereof, by and between Reorganized Centric, as performance guarantor and the
. . .
Item 2.03 Creation of Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information in Item 1.03 is incorporated by reference into this Item 2.03.
Item 3.02 Unregistered Sales of Equity Securities.
Pursuant to the Plan and following the cancellation of Centric Brands Inc.'s
outstanding common stock described in this Current Report, on the Effective
Date, Reorganized Centric issued new common membership interests (the
"Interests") to holders of allowed First Lien Term Loan Claims and Second Lien
Secured Claims. The issuance of the Units was exempt
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from registration under the Securities Act pursuant to section 1145 of the
Bankruptcy Code or another exemption from registration.
Item 3.03 Material Modification to the Rights of Security Holders.
The information in Item 1.03, Item 5.01 and Item 5.03 is incorporated by
reference into this Item 3.03.
Item 5.01 Changes in Control of Registrant.
On the Effective Date, pursuant to the Plan, all equity interests in Centric
Brands Inc. outstanding immediately prior to the Effective Date were cancelled,
discharged, and of no force and effect. On the Effective Date, pursuant to the
Plan, Reorganized Centric issued the Interests to holders of holders of allowed
First Lien Term Loan Claims and Second Lien Secured Claims.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Pursuant to and in accordance with the Plan, on the Effective Date, Marjorie
Bowen, Sherman K. Edmiston III, Patrick J. Bartels, William Sweedler, Matthew
Eby, Glenn Krevlin, Walter McLallen, and Kent Savage ceased to be directors of
the Company (collectively, the "Departing Directors"). Each of the Departing
Directors' decision to resign was not related to a disagreement with the Company
over any financial reporting, internal control, accounting or auditing matters.
Mitchell Goldstein, Randall Kessler, Vikas Keswani, Kelley Morrell, Robert
Petrini, Jason Rabin, and Andrew Sagat were designated as members of the Board
of Managers of Reorganized Centric on the Effective Date.
Item 5.03 Amendments to Articles of Incorporation or Bylaws
On the Effective Date, in connection with the implementation of the Plan and
pursuant to the Plan, the Company converted from a corporation to a limited
liability company by filing a Certificate of Conversion and Certificate of
Formation with the Secretary of State of the State of Delaware and adopted a
Limited Liability Company Agreement.
Item 8.01 Other Events
Deregistration of Common Stock
In conjunction with its emergence from bankruptcy, Reorganized Centric intends
to file post-effective amendments to all of the Company's currently effective
Registration Statements on Form S-8 and to promptly file a Form 15 with the
Securities and Exchange Commission (the "SEC") to deregister its securities
under Section 12(g) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and suspend each its reporting obligations under Sections 13(a)
and 15(d) of the Exchange Act. Upon the filing of the Form 15, Reorganized
Centric's obligation to file periodic and current reports with the SEC,
including Forms 10-K, 10-Q and 8-K, will be immediately suspended.
Press Release
On the Effective Date, Reorganized Centric issued a press release announcing its
emergence from the restructuring process and successful consummation of the
Plan. A copy of the press release is attached hereto as Exhibit 99.1 and is
incorporated by reference into this Item 8.01.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following exhibits are filed with this report:
Exhibit
Number Description
99.1 Press Release of Centric Brands, LLC--------------------------------------------------------------------------------
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CENTRIC BRANDS INC. 
