Belk has entered into a Restructuring Support Agreement (the "RSA") with its majority owner, Sycamore Partners, a private equity firm specializing in consumer, retail and distribution investments, and holders of over 75% of its first lien term loan debt and holders of 100% of its second lien term loan debt on a plan to recapitalize the business, significantly reduce debt by approximately $450 million, and extend maturities on all term loans to July 2025. Under the terms of the RSA, Sycamore Partners will retain majority control of Belk. The retailer has received financing commitments for $225 million in new capital from Sycamore Partners, leading global investment firms KKR and Blackstone Credit, and certain existing first lien term lenders (the "Ad Hoc First Lien Lender Group"). Pursuant to the RSA, members of an ad hoc crossover lender group led by KKR Credit and Blackstone Credit (the "Ad Hoc Crossover Lender Group") and other participating lenders will acquire a minority ownership in Belk.

Under the RSA, suppliers will be unimpaired and will continue to be paid in the ordinary course for all goods and services provided to the company. Belk plans to continue normal operations throughout its financial restructuring process. Customers will continue to receive the quality merchandise and service they expect when shopping at Belk's stores across the Southeast and online. The infusion of new capital is expected to support Belk's continued investment in strategic initiatives, including delivering a seamless omnichannel shopping experience and expanding Belk's product offerings in Home Goods, Outdoor and Wellness.

"Belk has a 130-year legacy of providing quality products at great prices," said Lisa Harper, Belk CEO. "Like all retailers navigating COVID-19, our priority has been the safety of our associates, customers and communities. As the ongoing effects of the pandemic have continued, we've been assessing potential options to protect our future. We're confident that this agreement puts us on the right long-term path toward significantly reducing our debt and providing us with greater financial flexibility to meet our obligations and to continue investing in our business, including further enhancements and additions to Belk's omnichannel capabilities."

Belk expects to complete the financial restructuring transaction through an expedited "pre-packaged" reorganization under Chapter 11 of the U.S. Bankruptcy Code. The company expects the transaction to be completed by the end of February.                      

Kirkland & Ellis LLP is serving as legal adviser, Lazard is serving as financial adviser, and Alvarez & Marsal North America, LLC is serving as restructuring adviser to Belk. Latham & Watkins LLP is serving as legal advisor to Sycamore Partners. Willkie Farr & Gallagher LLP is serving as legal advisor and PJT Partners LP is serving as financial advisor to the Ad Hoc Crossover Lender Group and O'Melveny & Myers LLP is serving as legal advisor and Evercore is serving as financial advisor to the Ad Hoc First Lien Lender Group.