Nine West Holdings – Emerges from Chapter 11 as Premier Brands Group Having Shed More than $1bn in Debt

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March 20, 2019 – Nine West Holdings notified the Court [Docket No. 1369] that their Third Amended Joint Chapter 11 Plan had become effective as of March 20, 2019. The Court had confirmed the Debtors' Plan on February 27, 2019 [the confirmation order, was filed at Docket No. 1308].

In a press release announcing its emergence from chapter 11, the Company (now known as Premier Brands Group) stated that, “It has successfully completed its financial and operational restructuring and emerged from Chapter 11 under the majority equity ownership of CVC Credit Partners and Brigade Capital. The Company has been renamed Premier Brands Group Holdings LLC (‘Premier Brands Group’). 

Premier Brands Group will move forward with a right-sized capital structure, streamlined operational footprint, profitable and growing wholesale and licensing businesses, and proven management teams in place. It will have over $100 million of go-forward liquidity to support its operations and future growth initiatives, as a result of successfully syndicated exit financing facilities led by Wells Fargo and Goldman Sachs."

Ralph Schipani, chief executive officer of Premier Brands Group, added: "Over the past year we have successfully reduced our pre-bankruptcy debt obligations by more than $1 billion and have completed a significant operational restructuring following the sale of our Nine West and Bandolino footwear and handbag businesses.”

On April 6, 2018, Nine West Holdings (f/k/a Jones Group) and ten affiliated Debtors filed for Chapter 11 protection with the U.S. Bankruptcy Court in the Southern District of New York, lead case number 18-10947. The Company, which designs, markets and wholesales apparel, footwear and accessories, initiated its Chapter 11 process having entered into a restructuring support agreement (the "RSA") with parties that held 78% of its secured term debt and over 89% of its unsecured term debt.

On February 15, 2019, the Debtors filed a third Amended Chapter 11 Plan incorporating the global settlement announced on the record at the Court hearing held on February 8, 2019. The Debtors, the Official Committee of Unsecured Creditors (the “UCC”), the Secured Term Loan Lenders, the Unsecured Term Loan Lenders, the Equity Holders (ie Sycamore Partners Management and Kohlberg Kravis Roberts & Co or "KKR"), the 2019 Notes Trustee, the 2034 Notes Trustee, and the Ad Hoc Group of Unsecured Noteholders each agreed to support confirmation of the Third Amended Joint Plan.

The following is a summary of classes, claims, voting rights and expected recoveries (defined terms are as defined in the Plan):

  • Class 1 (“Other Priority Claims”) was unimpaired, deemed to accept and not entitled to vote on the Plan. The projected amount of claims is $189,698 and projected recovery is 100%.
  • Class 2 (“Other Secured Claims”) was unimpaired, deemed to accept and not entitled to vote on the Plan. The projected amount of claims is $812,852 and projected recovery is 100%. 
  • Class 3 (“Secured Tax Claims”) was unimpaired, deemed to accept and not entitled to vote on the Plan. 
  • Class 4 (“Secured Term Loan Claims”) was impaired and entitled to vote on the Plan. The projected amount of claims is $432,798,741 and projected recovery is 100%.
  • Class 5A (“Unsecured Term Loan Claims”) was impaired and entitled to vote on the Plan. The projected amount of claims is $305,099,461 and each holder of an Allowed Unsecured Term Loan Claim shall receive its Pro Rata share of: (i) 91.5%  of  the  New  Common  Stock,  subject  to  dilution  by the  Management Incentive Plan and the New Warrants; (ii)$16,250,000 in Cash from the Equity Holders Settlement Proceeds; (iii) $3,700,000 from the Debtors; (iv) Cash in an amount equal to the Administrative Expense Savings; and (v) Cash from the Professional Fee Savings in excess of $5,000,000.
  • Class 5B (“2034 Notes Claims”) was impaired and entitled to vote on the Plan. The projected amount of claims is $255,997,396 and each holder of an Allowed General Unsecured Claim in Class 5B shall receive: (i) its Pro Rata share (based on the aggregate amount of Allowed Claims in Classes 5B, 5C, and 5D) of: (1) $48,750,000 in Cash from the Equity Holders Settlement Proceeds; (2) the first $5,000,000 in Cash from the Professional Fee Savings; (3) $24,400,000 in Cash from the Debtors; (4) 7.981% of the New Common Stock, subject to dilution by the Management Incentive Plan and the New Warrants; and (5) the New Warrants; and (ii) Either: (1) its Pro Rata share (based on (A) an Allowed 2034 Notes Claim in the amount of $319,996,745, (B) the Allowed Claims in Class 5C, and (C) the Allowed Claims in Class 5D) of the Class II Non-Released Party Trust Interests; or (2) solely to the extent that such holder is not a member of the Ad Hoc Group of Unsecured Noteholders, the Cash-Out Option to the extent such holder timely elects to receive the Cash-Out Option.
  • Class 5C (“2019 Notes Claims”) was impaired and entitled to vote on the Plan. The projected amount of claims is $476,002,016 and each holder of an Allowed General Unsecured Claim in Class 5D shall receive: (i) its Pro Rata share (based on the aggregate amount of Allowed Claims in Classes 5B, 5C, and 5D) of: (1) $48,750,000 in Cash from the Equity Holders Settlement Proceeds; (2) the first $5,000,000 in Cash from the Professional Fee Savings; (3) $24,400,000 in Cash from the Debtors; (4) 7.981% of the New Common Stock, subject to dilution by the Management Incentive Plan and the New Warrants; and (5) the New Warrants; and (ii) Either: (1) its Pro Rata share (based on (A) an Allowed 2034 Notes Claim in the amount of $319,996,745, (B) the Allowed Claims in Class 5C, and (C) the Allowed Claims in Class 5D) of the Class II Non-Released Party Trust Interests; or (2) solely to the extent that such holder is not a member of the Ad Hoc Group of Unsecured Noteholders, the Cash-Out Option to the extent such holder timely elects to receive the Cash-Out Option.
  • Class 5D (“General Unsecured Claims against NWHI”) was impaired and entitled to vote on the Plan. The projected amount of claims is $157,897,543 and each holder of an Allowed General Unsecured Claim in Class 5D shall receive: (i) its Pro Rata share (based on the aggregate amount of Allowed Claims in Classes 5B, 5C, and 5D) of: (1) $48,750,000 in Cash from the Equity Holders Settlement Proceeds; (2) the first $5,000,000 in Cash from the Professional Fee Savings; (3) $24,400,000 in Cash from the Debtors; (4) 7.981% of the New Common Stock, subject to dilution by the Management Incentive Plan and the New Warrants; and (5) the New Warrants; and (ii) Either: (1) its Pro Rata share (based on (A) an Allowed 2034 Notes Claim in the amount of $319,996,745, (B) the Allowed Claims in Class 5C, and (C) the Allowed Claims in Class 5D) of the Class II Non-Released Party Trust Interests; or (2) solely to the extent that such holder is not a member of the Ad Hoc Group of Unsecured Noteholders, the Cash-Out Option to the extent such holder timely elects to receive the Cash-Out Option.
  • Class 5E (“General Unsecured Claims against Nine West Development LLC”) was impaired and entitled to vote on the Plan. The projected amount of claims is $92,843 and each holder of an Allowed General Unsecured Claim in Class 5E shall receive its Pro Rata share of 0.039% of the New Common Stock from the GUC Subsidiary Equity Pool, subject to dilution by the Management Incentive Plan and the New Warrants.
  • Class 5F (“General Unsecured Claims against Nine West Management Service LLC”) is impaired and entitled to vote on the Plan. The projected amount of claims is $2,705,054 and each holder of an Allowed General Unsecured Claim in Class 5F shall receive its Pro Rata share of 0.147% of the New Common Stock from the GUC Subsidiary Equity Pool, subject to dilution by the Management Incentive Plan and the New Warrants.
  • Class 5G (“General Unsecured Claims against Nine West Distribution LLC”) was impaired and entitled to vote on the Plan. The projected amount of claims is $76,133 and projected recovery is 6.9%. Each holder of an Allowed General Unsecured Claim in Class 5G shall receive its Pro Rata share of 0.002% of the New Common Stock from the GUC Subsidiary Equity Pool, subject to dilution by the Management Incentive Plan and the New Warrants.
  • Class 5H (“General Unsecured Claims against One Jeanswear Group Inc.”) was impaired and entitled to vote on the Plan. The projected amount of claims is $2,386,675 and each holder of an Allowed General Unsecured Claim in Class 5H shall receive its Pro Rata share of 0.221% of the New Common Stock from the GUC Subsidiary Equity Pool, subject to dilution by the Management Incentive Plan and the New Warrants.
  • Class 5I (“General Unsecured Claims against Kasper Group LLC”) was impaired and entitled to vote on the Plan. The projected amount of claims is $1,994,648 and each holder of an Allowed General Unsecured Claim in Class 5I shall receive its Pro Rata share of 0.110% of the New Common Stock from the GUC Subsidiary Equity Pool, subject to dilution by the Management Incentive Plan and the New Warrants.
  • Class 5J (“General Unsecured Claims against Non-Operating Debtors”) was impaired, deemed to reject and not entitled to vote on the Plan. The projected amount of claims is $76,352 and projected recovery is 0%. 
  • Class 6 (“Intercompany Claims”) is unimpaired/impaired, deemed to have accepted/rejected and not entitled to vote on the Plan. On the Effective Date, all Intercompany Claims shall be, as determined by the Debtors with the reasonable consent of the Requisite Unsecured Lenders, either:(i)  Reinstated, (ii) converted to equity, or (iii) cancelled and shall receive no distribution on account of such Claims and may be compromised, extinguished, or settled after the Effective Date.
  • Class 7 (“Interests in Holdings”) was impaired, deemed to reject and not entitled to vote on the Plan. Estimated recovery is 0%.
  • Class 8 ("Intercompany Interests") was unimpaired/impaired, deemed to have accepted/rejected and not entitled to vote on the Plan. On the Effective Date, Intercompany Interests shall be, as determined by the Debtors with the reasonable consent of the Requisite Unsecured Lenders, either: (i) Reinstated, or (ii) discharged, cancelled, released, and extinguished as of the Effective Date, and will be of no further force or effect, and holders of Intercompany Interests will not receive any distribution on account of such Intercompany Interests.

Class 9 (“Section 510(b) Claims”) was impaired, deemed to reject and not entitled to vote on the Plan. Estimated recovery is 0%.

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