American Apparel reached an agreement with creditors for a $90 million asset-based revolving credit facility. The company noted in its Q2/15 news release on financial results that Capital One Business Credit assigned its rights and obligations as a lender to a syndicate of lenders that included certain of the company’s existing creditors, including funds associated with Standard General, Monarch Alternative Capital, Coliseum Capital and Goldman Sachs Asset Management, and was replaced by Wilmington Trust, as administrative agent.

Additionally, on August 17, 2015, the Capital One credit facility was amended pursuant to an amended credit agreement among the company, the new syndicate of lenders and Wilmington Trust.

In connection with this amendment, the syndicate of lenders received certain amendment and closing fees and reimbursement of closing expenses. The covenant violations existing at June 30, 2015 were waived under the Wilmington Trust credit facility.

The Wilmington Trust credit facility provides for a $90 million asset-based revolving credit facility and matures on April, 4, 2018, subject to a January 15, 2018 maturity in limited circumstances. Borrowings under the Wilmington Trust Credit Facility are subject to specified borrowing base requirements which is increased by $15 million, but such $15 million increase cannot increase the borrowing base above $60 million. Amounts repaid under the Wilmington Trust credit facility cannot be re-borrowed.

Borrowings currently outstanding under the Capital One credit facility will continue under the Wilmington Trust credit facility and bear interest at a LIBOR based rate plus 5.0% or a rate based on the prime rate plus 4.0%. New borrowings under the Wilmington Trust credit facility bear interest at a LIBOR based rate plus 7.0% or a rate based on the prime rate plus 6.0%.

American Apparel reported Q2/15 sales were down 17.2% to $134.4 million from $162.4 million in Q2/14. The net loss for Q2/15 was $19.4 million compared to a net loss of $16.2 million in Q2/14. As of June 30, 2015, the company had $6.9 million in cash, $38.4 million outstanding on its $50 million asset-based revolver with Capital One.

The company said it incurred losses from operations and negative cash flows from operating activities for the six months ended June 30, 2015 and such losses might continue for the remainder of 2015. Based upon the trends occurring in the company’s current operations, together with the company’s current expectations and projections for the next four fiscal quarters, the company said it believes that it may not have sufficient liquidity necessary to sustain operations for the next twelve months. These factors, among others, raise substantial doubt that the company will be able to continue as a going concern.

Access the full Q2/15 report here.