Former American Apparel receives extension to avoid competing plans

By Caroline Salls

Pittsburgh, Feb. 6 – APP Winddown, LLC, formerly American Apparel, LLC, received a fourth extension of its exclusive periods for filing and soliciting votes on a Chapter 11 plan, according to an order filed Tuesday with the U.S. Bankruptcy Court for the District of Delaware.

APP’s exclusive plan-filing period was extended to May 14 from Jan. 12 and the solicitation period through July 14 from March 14.

The company said it recently obtained court approval of a settlement with its pre-bankruptcy lenders that resolved various inter-creditor disputes.

With that resolution in place, APP said it is negotiating a Chapter 11 plan that is based on the lender settlement and a January 2017 settlement with its official committee of unsecured creditors and a litigation trustee.

“The debtors are optimistic that, in the coming weeks, they will be able to propose, and ultimately confirm, a Chapter 11 plan in these cases,” the motion said.

“The requested extension will maintain the status quo and permit the debtors to seek confirmation of the contemplated plan without the interruption or costs attendant to any competing plan process.”

American Apparel is a Los Angeles-based manufacturer, distributor and retailer of branded fashion basic apparel. The company filed for bankruptcy on Nov. 14, 2016 under Chapter 11 case number 16-12551.

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