As reported by TribLive, GNC Holdings, Inc. reached a last-minute deal with creditors that allows it to avoid bankruptcy for at least 30 days but no more than 90 days under a deal announced on May 15, the Pennsylvania-based health and wellness company said. 
GNC was facing a May 16 deadline to pay down debt to under $50 million or be forced to accept lenders taking a stake in the company. CEO Ken Martindale said that the company was negotiating with its creditors and all options were on the table, including filing for protection from creditors under Chapter 11 of the bankruptcy code.
The agreement filed with the federal Securities and Exchange Commission states that lenders holding more than 25 percent of the company’s debt could accelerate payments as of June 15.
If GNC has less than $100 million in liquidity as of June 15, it could be forced into accelerated payment, according to the agreement. Otherwise, GNC will have until Aug. 10, or a later unspecified date, to pay down its outstanding debt from February 2018.
Martindale had told analysts in a call explaining its $200 million loss in the first quarter of the year that the company has suffered from the effects of the COVID19-caused shutdowns of many of its stores and it could not make the payments as due.
The agreement places a $66 million cap on GNC’s ability to borrow from a revolving line of credit. GNC said it will continue to explore its options to refinance and restructure its debt.
For more information, visit https://www.gnc.com/.
