Pg 1 of 114 Hearing Date and Time: June 28, 2018, at 10:00 a.m. (prevailing Eastern Time) Objection Deadline: June 21, 2018, at 4:00 p.m. (prevailing Eastern Time) James H.M. Sprayregen, P.C. Christopher J. Marcus, P.C. James A. Stempel (admitted pro hac vice) Joseph M. Graham (admitted pro hac vice) KIRKLAND & ELLIS LLP Angela M. Snell (admitted pro hac vice) KIRKLAND & ELLIS INTERNATIONAL LLP KIRKLAND & ELLIS LLP 601 Lexington Avenue New York, New York 10022 KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Street Telephone: (212) 446-4800 Chicago, Illinois 60654 Facsimile: (212) 446-4900 Telephone: (312) 862-2000 Facsimile: (312) 862-2200 Proposed Counsel to the Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ) In re: ) Chapter 11 ) NINE WEST HOLDINGS, INC., et al., 1 ) Case No. 18-10947 (SCC) ) Debtors. ) (Jointly Administered) ) NOTICE OF DEBTORS MOTION FOR ENTRY OF AN ORDER (I) APPROVING (A) THE ADEQUACY OF INFORMATION IN THE DISCLOSURE STATEMENT, (B) SOLICITATION AND NOTICE PROCEDURES, AND (C) CERTAIN DATES WITH RESPECT TO PLAN CONFIRMATION, AND (II) GRANTING RELATED RELIEF PLEASE TAKE NOTICE that a hearing on the Debtors Motion for Entry of an Order (I) Approving (A) the Adequacy of Information in the Disclosure Statement, (B) Solicitation and Notice Procedures, and (C) Certain Dates With Respect To Plan Confirmation, and (II) Granting Related Relief (the Motion ) will be held before the Honorable Shelley C. Chapman, United States Bankruptcy Judge, United States Bankruptcy Court for the Southern District of New York 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are: Nine West Holdings, Inc. (7645); Jasper Parent LLC (4157); Nine West Management Service LLC (4508); Kasper Group LLC (7906); Kasper U.S. Blocker LLC (2390); Nine West Apparel Holdings LLC (3348); Nine West Development LLC (2089); Nine West Distribution LLC (3029); Nine West Jeanswear Holding LLC (7263); One Jeanswear Group Inc. (0179); and US KIC Top Hat LLC (3076). The location of the Debtors service address is: 1411 Broadway, New York, New York 10018.
Pg 2 of 114 (the Court ), One Bowling Green, Courtroom No. 623, New York, New York 10004-1408, on June 28, 2018, at 10:00 a.m. (prevailing Eastern Time). PLEASE TAKE FURTHER NOTICE that any responses or objections to the relief requested in the Motion shall: (a) be in writing; (b) conform to the Federal Rules of Bankruptcy Procedure, the Local Bankruptcy Rules for the Southern District of New York, all General Orders applicable to chapter 11 cases in the United States Bankruptcy Court for the Southern District of New York, and the Order (A) Establishing Certain Notice, Case Management, and Administrative Procedures and (B) Granting Related Relief [Docket No. 107] (the Case Management Order ) approved by the Court; (c) be filed electronically with the Court on the docket of In re Nine West Holdings, Inc., Case 18-10974 (SCC) by registered users of the Court s electronic filing system and in accordance with the General Order M-399 (which is available on the Court s website at http://www.nysb.uscourts.gov); and (d) be served so as to be actually received by June 21, 2018, at 4:00 p.m., prevailing Eastern Time, by (i) the entities on the Master Service List (as defined in the Case Management Order and available on the Debtors case website at https://cases.primeclerk.com/ninewest) and (ii) any person or entity with a particularized interest in the subject matter of the Motion. PLEASE TAKE FURTHER NOTICE that only those responses that are timely filed, served, and received will be considered at the hearing. Failure to file a timely objection may result in entry of a final order granting the Motion as requested by the Debtors. 2
Pg 3 of 114 New York, New York Dated: May 2, 2018 /s/ Joseph M. Graham James H.M. Sprayregen, P.C. Christopher J. Marcus, P.C. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 - and - James A. Stempel (admitted pro hac vice) Joseph M. Graham (admitted pro hac vice) Angela M. Snell (admitted pro hac vice) KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Street Chicago, Illinois 60654 Telephone: (312) 862-2000 Facsimile: (312) 862-2200 Proposed Counsel to the Debtors and Debtors in Possession 3
Pg 4 of 114 Hearing Date and Time: June 28, 2018, at 10:00 a.m. (prevailing Eastern Time) Objection Deadline: June 21, 2018, at 4:00 p.m. (prevailing Eastern Time) James H.M. Sprayregen, P.C. Christopher J. Marcus, P.C. James A. Stempel (admitted pro hac vice) Joseph M. Graham (admitted pro hac vice) KIRKLAND & ELLIS LLP Angela M. Snell (admitted pro hac vice) KIRKLAND & ELLIS INTERNATIONAL LLP KIRKLAND & ELLIS LLP 601 Lexington Avenue New York, New York 10022 KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Street Telephone: (212) 446-4800 Chicago, Illinois 60654 Facsimile: (212) 446-4900 Telephone: (312) 862-2000 Facsimile: (312) 862-2200 Proposed Counsel to the Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ) In re: ) Chapter 11 ) NINE WEST HOLDINGS, INC., et al., 1 ) Case No. 18-10947 (SCC) ) Debtors. ) (Jointly Administered) ) DEBTORS MOTION FOR ENTRY OF AN ORDER (I) APPROVING (A) THE ADEQUACY OF INFORMATION IN THE DISCLOSURE STATEMENT, (B) SOLICITATION AND NOTICE PROCEDURES, AND (C) CERTAIN DATES WITH RESPECT TO PLAN CONFIRMATION, AND (II) GRANTING RELATED RELIEF The above-captioned debtors and debtors in possession (collectively, the Debtors ) respectfully state as follows in support of this motion: Relief Requested 1. By this motion, the Debtors seek entry of an order, substantially in the form attached hereto as Exhibit A, (a) approving the Disclosure Statement 2 as containing adequate 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are: Nine West Holdings, Inc. (7645); Jasper Parent LLC (4157); Nine West Management Service LLC (4508); Kasper Group LLC (7906); Kasper U.S. Blocker LLC (2390); Nine West Apparel Holdings LLC (3348); Nine West Development LLC (2089); Nine West Distribution LLC (3029); Nine West Jeanswear Holding LLC (7263); One Jeanswear Group Inc. (0179); and US KIC Top Hat LLC (3076). The location of the Debtors service address is: 1411 Broadway, New York, New York 10018. 2 Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to them in the Debtors Joint Plan of Reorganization Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 128] (as may be
Pg 5 of 114 information pursuant to section 1125 of the Bankruptcy Code, (b) approving the procedures and related exhibits (the Solicitation and Voting Procedures ), substantially in the form attached to the Order as Exhibit 1 to Exhibit A, for (i) soliciting, receiving, and tabulating votes to accept or reject the Plan, (ii) voting to accept or reject the Plan, and (iii) filing objections to the Plan, (c) approving the confirmation schedule set forth herein, and (d) granting related relief. Introduction 2. The Debtors commenced these chapter 11 cases to implement a restructuring supported by over 78 percent of their secured term loan lenders and over 89 percent of their unsecured term loan lenders. The restructuring transactions contemplated by the Plan will allow the Debtors to right size their balance sheet, and execute on their turnaround strategy to concentrate exclusively on their One Jeanswear Group, Kasper Group, The Jewelry Group, and Anne Klein businesses. Importantly, the Plan will eliminate more than $900 million of the Debtors prepetition funded debt and, maximize the value of the Debtors go-forward business to position the Debtors for future success. The Debtors believe that the Plan maximizes stakeholder recoveries in these chapter 11 cases, and therefore, intend to solicit acceptances of the Plan. By this motion, the Debtors are seeking the Court s approval of the Disclosure Statement. 3. The Plan contemplates classifying holders of Claims and Interests into certain Classes of Claims and Interests for all purposes, including with respect to voting on the Plan, amended, supplemented, or modified from time to time, the Plan ) or the Disclosure Statement for the Debtors Joint Plan of Reorganization Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 129] (as may be amended, supplemented or modified from time to time, the Disclosure Statement ), as applicable. 2
Pg 6 of 114 pursuant to section 1126 of the Bankruptcy Code. The following chart represents the Classes of Claims and Interests under the Plan: 3 Class Claims and Interests Status Voting Rights Class 1 Other Priority Claims Unimpaired Not Entitled to Vote (Presumed to Accept) Class 2 Other Secured Claims Unimpaired Not Entitled to Vote (Presumed to Accept) Class 3 Secured Tax Claims Unimpaired Not Entitled to Vote (Presumed to Accept) Class 4 Secured Term Loan Claims Impaired Entitled to Vote Class 5A Unsecured Term Loan Claims Impaired Entitled to Vote Class 5B 2034 Notes Claims Impaired Entitled to Vote Class 5C 2019 Notes Claims Impaired Entitled to Vote Class 5D General Unsecured Claims against NWHI Impaired Entitled to Vote Class 5E General Unsecured Claims against each Debtor other than NWHI Impaired Entitled to Vote Class 6 Intercompany Claims Impaired or Not Entitled to Vote (Presumed to Unimpaired Accept or Deemed to Reject) Class 7 Interests in Holdings Impaired Not Entitled to Vote (Deemed to Reject) Class 8 Intercompany Interests Impaired or Not Entitled to Vote (Presumed to Unimpaired Accept or Deemed to Reject) Class 9 Section 510(b) Claims Impaired Not Entitled to Vote (Deemed to Reject) 4. Based on the foregoing (and as discussed in greater detail herein), the Debtors are proposing to solicit votes to accept or reject the Plan from holders of Claims in Classes 4, 5A, 5B, 5C, 5D, and 5E (collectively, the Voting Classes ). The Debtors are not proposing to solicit votes from holders of Claims and Interests in Classes 1, 2, 3, 6, 7, 8, and 9 (collectively, the Non-Voting Classes ). 3 As set forth in more detail in the Plan, the Plan will apply as a separate Plan for each of the Debtors, and the classification of Claims and Interests set forth in the Plan will apply separately to each of the Debtors. Certain of the Debtors may not have holders of Claims or Interests in a particular Class or Classes. For all purposes under the Plan, each Class will contain sub-classes for each of the Debtors, except that (1) Class 5B, Class 5C, and Class 5D shall be vacant at each Debtor other than Nine West Holdings, Inc., (2) Class 5E shall be vacant at Nine West Holdings, Inc., and (3) Class 7 shall be vacant at each Debtor other than Jasper Parent LLC. 3
Pg 7 of 114 5. In accordance with the requirements of the Bankruptcy Code, the Bankruptcy Rules, and the Local Rules (each as defined herein), the Debtors propose the following timeline (the Solicitation Timeline ) to govern the process for soliciting, receiving, and tabulating votes on the Plan: 4 Item Date Voting Record Date June 28, 2018 Solicitation Deadline July 6, 2018 Voting Deadline Plan Objection Deadline August 6, 2018, at 4:00 p.m., prevailing Eastern Time August 6, 2018, at 4:00 p.m., prevailing Eastern Time Deadline to File Voting Report August 10, 2018, at 4:00 p.m., prevailing Eastern Time Confirmation Brief and Reply Deadline August 13, 2018, at 12:00 p.m., prevailing Eastern Time Start of Confirmation Hearing August 14, 2018 6. The Debtors submit that the proposed Solicitation Timeline, as further detailed below, will afford the Court, the Debtors, and all parties in interest reasonable time to review and consider the Plan and Disclosure Statement prior to the hearing to consider confirmation of the Plan (the Confirmation Hearing ). The Solicitation Timeline will also provide parties with plenty of time to consider whether to vote to accept or reject the Plan (if applicable) and whether to object to entry of an order confirming the Plan. Jurisdiction and Venue 7. The United States Bankruptcy Court for the Southern District of New York (the Court ) has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334 and the Amended Standing Order of Reference from the United States District Court for the Southern District of New York, dated January 31, 2012. The Debtors confirm their consent, pursuant to 4 Capitalized terms used in this chart shall have the meanings ascribed to them later herein. 4
Pg 8 of 114 rule 7008 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules ), to the entry of a final order by the Court in connection with this motion to the extent that it is later determined that the Court, absent consent of the parties, cannot enter final orders or judgments in connection herewith consistent with Article III of the United States Constitution. 8. Venue is proper pursuant to 28 U.S.C. 1408 and 1409. 9. The bases for the relief requested herein are sections 1125, 1126, and 1128 of title 11 of the United States Code, 11 U.S.C. 101 1532 (the Bankruptcy Code ), Bankruptcy Rules 2002, 3016, 3017, 3018, and 3020, and rules 3017-1, 3018-1, and 3020-1 of the Local Bankruptcy Rules for the Southern District of New York (the Local Rules ). Basis for Relief I. The Court Should Approve the Disclosure Statement. A. The Disclosure Statement Contains Adequate Information. 10. Pursuant to section 1125 of the Bankruptcy Code, the proponent of a proposed chapter 11 plan must provide adequate information regarding that plan to holders of impaired claims and interests entitled to vote on the plan. 11 U.S.C. 1125. Specifically, section 1125(a)(1) of the Bankruptcy Code states, in relevant part, as follows: [A]dequate information means information of a kind, and in sufficient detail, as far as is reasonably practicable in light of the nature and history of the debtor and the condition of the debtor s books and records, including a discussion of the potential material Federal tax consequences of the plan to the debtor, any successor to the debtor, and a hypothetical investor typical of the holders of claims or interests in the case, that would enable such a hypothetical investor of the relevant class to make an informed judgment about the plan. 11 U.S.C. 1125(a)(1). 11. A disclosure statement must, as a whole, provide information that is reasonably practicable to permit an informed judgment by creditors and interest holders, if applicable, to vote on a plan. See In re Momentum Mfg. Corp., 25 F.3d 1132, 1136 (2d Cir. 1994); see also In re 5
Pg 9 of 114 Ionosphere Clubs, Inc., 179 B.R. 24, 29 (Bankr. S.D.N.Y. 1995) (adequacy of a disclosure statement is to be determined on a case-specific basis under a flexible standard that can promote the chapter 11 policy of fair settlement through a negotiation process between informed interested parties (internal citation omitted)). Adequate information is a flexible standard, based on the facts and circumstances of each case. 11 U.S.C. 1125(a)(1) ( [A]dequate information means information of a kind, and in sufficient detail, as far as is reasonably practicable in light of the nature and history of the debtor and the condition of the debtor s books and records ); see also Oneida Motor Freight, Inc. v. United Jersey Bank, 848 F.2d 414, 417 (3d Cir. 1988) ( From the legislative history of 1125 we discern that adequate information will be determined by the facts and circumstances of each case. ). 12. In making a determination as to whether a disclosure statement contains adequate information as required by section 1125 of the Bankruptcy Code, courts typically look for disclosures related to topics such as: a. the events that led to the filing of a bankruptcy petition; b. the relationship of the debtor with its affiliates; c. a description of the available assets and their value; d. the company s anticipated future; e. the source of information stated in the disclosure statement; f. the debtors condition while in chapter 11; g. claims asserted against the debtor; h. the estimated return to creditors under a chapter 7 liquidation; i. the future management of the debtor; j. the chapter 11 plan or a summary thereof; 6
Pg 10 of 114 k. financial information, valuations, and projections relevant to a creditor s decision to accept or reject the chapter 11 plan; l. information relevant to the risks posed to creditors under the plan; m. the actual or projected realizable value from recovery of preferential or otherwise avoidable transfers; n. litigation likely to arise in a nonbankruptcy context; and o. tax attributes of the debtor. See In re U.S. Brass Corp., 194 B.R. 420, 424 25 (Bankr. E.D. Tex. 1996). Despite these case law enumerated topics, adequate information is determined on a case-specific basis. See, e.g., Kirk v. Texaco, Inc., 82 B.R. 678, 682 (S.D.N.Y. 1988) ( The legislative history could hardly be more clear in granting broad discretion to bankruptcy judges under 1125(a): Precisely what constitutes adequate information in any particular instance will develop on a case-by-case basis. Courts will take a practical approach as to what is necessary under the circumstances of each case. (quoting H.R. Rep. No. 595, at 408 09 (1977))). 13. Here, the Disclosure Statement provides adequate information to allow holders of Claims in the Voting Classes to make informed decisions about whether to vote to accept or reject the Plan. Specifically, the Disclosure Statement contains a number of categories of information that courts consider adequate information, including: a. The Debtors Corporate History, Structure, and Business Overview. A detailed overview of the Debtors corporate history, business operations, organizational structure, and capital structure is provided in Article IV of the Disclosure Statement; b. Events Leading to the Chapter 11 Filings. A detailed overview of the Debtors out-of-court restructuring efforts and the negotiations with respect to the Plan and RSA (as defined herein) is provided in Article IV of the Disclosure Statement; 7
Pg 11 of 114 c. Projected Financial Information, Valuation Analysis, and Liquidation Analysis. Certain projected financial information, a valuation analysis, and a liquidation analysis are attached to the Disclosure Statement as Exhibits D F, respectively; 5 d. Risk Factors. Certain risks associated with the Debtors businesses, as well as certain risks associated with forward-looking statements and an overall disclaimer as to the information provided by and set forth in the Disclosure Statement, are described in Article VIII of the Disclosure Statement; e. Solicitation and Voting Procedures. A description of the procedures for soliciting votes to accept or reject the Plan and voting on the Plan is provided in Article III of the Disclosure Statement; f. Confirmation of the Plan. Confirmation procedures and statutory requirements for confirmation and consummation of the Plan are described in Article VII of the Disclosure Statement; g. Certain Securities Laws Matters. A description of the applicability of section 1145 of the Bankruptcy Code and the issuance of New Common Stock under the Plan is provided in Article IX of the Disclosure Statement; h. Certain United States Federal Income Tax Consequences of the Plan. A description of certain U.S. federal income tax law consequences of the Plan is provided in Article X of the Disclosure Statement; and i. Recommendation. A recommendation by the Debtors that holders of Claims in the Voting Classes should vote to accept the Plan is included in Article XI of the Disclosure Statement. 14. Based on the foregoing, the Debtors submit that the Disclosure Statement complies with all aspects of section 1125 of the Bankruptcy Code and addresses the information set forth above in a manner that provides adequate information to holders of Claims entitled to vote to accept or reject the Plan. Accordingly, the Debtors submit that the Disclosure Statement contains adequate information and therefore should be approved. 5 The Debtors intend to file their projected financial information, valuation analysis, and liquidation analysis in advance of the hearing to approve the adequacy of the Disclosure Statement consistent with numerous cases filed in this district. 8
Pg 12 of 114 B. The Disclosure Statement Provides Sufficient Notice of Injunction, Exculpation, and Release Provisions in the Plan. 15. Bankruptcy Rule 3016(c) requires that, if a plan provides for an injunction against conduct not otherwise enjoined under the Bankruptcy Code, the plan and disclosure statement must describe, in specific and conspicuous language, the acts to be enjoined and the entities subject to the injunction. Fed. R. Bankr. P. 3016(c). 16. Article VI.D of the Disclosure Statement describes in detail the entities subject to an injunction under the Plan and the acts that they are enjoined from pursuing, including bolding language related to the Debtor Release, Third-Party Release, exculpation, and Plan injunction. Further, the relevant language in Article VIII of the Plan is in bold font, making it conspicuous to anyone who reads it. Accordingly, the Debtors respectfully submit that the Disclosure Statement complies with Bankruptcy Rule 3016(c) by conspicuously describing the conduct and parties enjoined by the Plan. 6 II. The Debtors Provided Adequate Notice of the Disclosure Statement Hearing. 17. Bankruptcy Rule 3017(a) requires that notice of the hearing to consider the proposed disclosure statement be provided to creditors and other parties in interest. See Fed. R. Bankr. P. 3017(a) (providing that after a disclosure statement is filed, it must be mailed with the notice of the hearing to consider the disclosure statement and any objections or modifications thereto on no less than 28 days notice thereof); see also Fed. R. Bankr. P. 2002(b) (requiring not less than 28 days notice by mail of the time for filing objections and the hearing to consider the approval of a disclosure statement). At least 28 days prior to the objection deadline for this motion, 6 The Debtors will be filing the initial list of Non-Released Parties and Retained Causes of Action Schedule (which will include claims against the Non-Released Parties) in advance of the hearing to approve the adequacy of the Disclosure Statement. 9
Pg 13 of 114 the Debtors will serve all known creditors with a copy of a notice for the hearing on the Disclosure Statement. This notice will identify (a) the date, time, and place of the hearing on approval of the Disclosure Statement (the Disclosure Statement Hearing ), (b) the manner in which a copy of the Disclosure Statement (and exhibits thereto, including the Plan) can be obtained, and (c) the deadline and procedures for filing objections to the approval of the Disclosure Statement. Additionally, the Debtors will distribute copies of the Disclosure Statement, including exhibits, to parties on the list of all parties required to be notified under Bankruptcy Rule 2002 (the 2002 List ). The Debtors submit that they have provided adequate notice of the hearing on approval of the Disclosure Statement and request that the Court approve such notice as appropriate and in compliance with the requirements of the Bankruptcy Code and the Bankruptcy Rules. III. The Court Should Approve the Solicitation Materials and Timeline for Soliciting Votes on the Plan. A. The Court Should Approve the Voting Record Date, Solicitation Deadline, and Voting Deadline. 18. Bankruptcy Rule 3017(d) provides that, for the purposes of soliciting votes in connection with the confirmation of a plan, creditors and equity security holders shall include holders of stocks, bonds, debentures, notes, and other securities of record on the date the order approving the disclosure statement is entered or another date fixed by the court, for cause, after notice and a hearing. Fed. R. Bankr. P. 3017(d). Bankruptcy Rule 3018(a) contains a similar provision regarding determination of the record date for voting purposes. Fed. R. Bankr. P. 3018(a). Additionally, Bankruptcy Rule 3017(c) provides that before approving the disclosure statement, the Court must fix a time within which the holders of claims and interests may accept or reject a plan and may fix a date for the hearing on confirmation of a plan. See Fed. R. Bankr. P. 3017(c). 10
Pg 14 of 114 19. As noted above, the Debtors request that the Court exercise its authority under Bankruptcy Rules 3017(d) and 3018(a) to establish the following: a. June 28, 2018 (the first day of the Disclosure Statement Hearing), as the date for determining (i) holders of Claims that are entitled to vote on the Plan and (ii) whether Claims have been properly transferred, including pursuant to Bankruptcy Rule 3001(e), such that the assignee may vote on the Plan (the Voting Record Date ). The Debtors propose that, with respect to any transferred Claim, the transferee shall be entitled to receive solicitation materials and documents included in the Solicitation Package (as defined herein) and, if the holder of such Claim is entitled to vote with respect to the Plan, cast a Ballot (as defined herein) on account of such Claim only if: (A) all actions necessary to effectuate the transfer of the Claim pursuant to Bankruptcy Rule 3001(e) have been completed by the Voting Record Date or (B) the transferee files by the Voting Record Date (1) the documentation required by Bankruptcy Rule 3001(e) to evidence the transfer and (2) a sworn statement of the transferor supporting the validity of the transfer. In the event a Claim is transferred after the Voting Record Date, the transferee of such Claim shall be bound by any vote on the Plan made by the holder of such Claim as of the Voting Record Date. b. July 6, 2018, as the date by which the Debtors shall distribute Solicitation Packages to holders of Claims entitled to vote on the Plan (the Solicitation Deadline ). c. August 6, 2018, at 4:00 p.m., prevailing Eastern Time, as the deadline by which all Ballot (i.e., all individual and master ballots) (as applicable) must be actually received by Prime Clerk, LLC, in its capacity as solicitation agent for the Debtors (the Solicitation Agent ) (such date, the Voting Deadline ). 20. The foregoing timing and materials will afford holders of Claims entitled to vote on the Plan at least 28 days within which to review and analyze such materials and subsequently make an informed decision as to whether to vote to accept or reject the Plan before the Voting Deadline consistent with the requirements of the applicable Bankruptcy Rules. See Fed. R. Bankr. P. 3017(d) (after approval of a disclosure statement, the debtor must transmit the plan, the approved disclosure statement, a notice of the time within which acceptances and rejections of 11
Pg 15 of 114 such plan may be filed, and any other information that the court may direct to certain holders of claims). B. The Court Should Waive the Requirements of Local Rule 3018-1. 21. Local Rule 3018-1(a) requires that a debtor file a voting report (a Voting Report ) that certifies the amount and number of allowed claims or allowed interests of each class accepting or rejecting the plan and any ballots not counted at least 7 days before the hearing on confirmation. Local R. Bankr. P. 3018-1(a). The Debtors restructuring support agreement (the RSA ) and postpetition financing agreements (which have been authorized by an interim order entered by the Court on April 9, 2018 [Docket No. 80] (the Interim DIP Order )) require that the confirmation hearing start on or before 130 days from the Petition Date, which is August 14, 2018. See RSA, Ex. A at 16; Docket No. 33, Ex. C, 6.16(vii). Moreover, the Debtors seek to ensure that parties in interest have sufficient time to review and analyze the Plan and Disclosure Statement and make an informed decision as to whether to vote to accept or reject the Plan or support or object to the Plan. The period from the Solicitation Deadline to the Voting Deadline is 31 days, which is in compliance with the Bankruptcy Rules. But the Voting Deadline is only 8 days before the confirmation hearing milestone in the RSA and the Interim DIP Order, and the Debtors and their Solicitation Agent will need sufficient time to prepare the Voting Report. Thus, in an effort to balance due process with compliance with the RSA and the Interim DIP Order milestones, the Debtors request a waiver of compliance with Local Rule 3018-1(a) and set the deadline to file the Voting Report for August 10, 2018, at 4:00 p.m., prevailing Eastern Time. C. The Court Should Approve the Solicitation and Voting Procedures. 22. Section 1126(c) of the Bankruptcy Code provides a class of claims has accepted a plan if such plan has been accepted by creditors... that hold at least two-thirds in amount and 12
Pg 16 of 114 more than one-half in number of the allowed claims of such class held by creditors... that have accepted or rejected the plan. 11 U.S.C. 1126(c). Additionally, Bankruptcy Rule 3018(c) provides, in part, that [a]n acceptance or rejection [of a plan] shall be in writing, identify the plan or plans accepted or rejected, be signed by the creditor or equity security holder or an authorized agent and conform to the appropriate Official Form. Fed. R. Bankr. P. 3018(c). Consistent with these requirements, the Debtors propose to use the Solicitation and Voting Procedures. 23. The proposed Solicitation and Voting Procedures include specific voting and tabulation requirements and procedures. The proposed Solicitation and Voting Procedures set forth specific criteria with respect to the general tabulation of Ballots, voting procedures applicable to holders of Claims, and tabulation of such votes. The Debtors believe that the proposed Solicitation and Voting Procedures will facilitate the Plan confirmation process. Specifically, the procedures will clarify any obligations of holders of Claims entitled to vote to accept or reject the Plan and will create a straightforward process by which the Debtors can determine whether they have satisfied the numerosity requirements of section 1126(c) of the Bankruptcy Code. Among other things, to ease and clarify the process of tabulating all votes received, the proposed Solicitation and Voting Procedures and related Ballots provide that a Ballot be counted in determining the acceptance or rejection of the Plan only if it satisfies certain criteria. Specifically, the Solicitation and Voting Procedures provide that the Debtors not count a Ballot if it is, among other things, illegible, submitted by a holder of a Claim that is not entitled to vote on the Plan, unsigned, or not clearly marked. Further, the Debtors, subject to a contrary order of the Court, may waive any defects or irregularities as to any particular Ballot at any time, either before or after the close of voting, and any such waivers shall be documented in the Voting Report. Accordingly, the Debtors submit that the Solicitation and Voting Procedures are in the best interests of their 13
Pg 17 of 114 estates, holders of Claims, and other parties in interest, and that good cause supports the relief requested herein. 24. The Debtors respectfully request that the Solicitation Agent be authorized (to the extent not authorized by another order of the Court) to assist the Debtors in: (a) distributing the Solicitation Package; (b) receiving, tabulating, and reporting on Ballots cast to accept or reject the Plan by holders of Claims against the Debtors; (c) responding to inquiries from holders of Claims and Interests and other parties in interest relating to the Disclosure Statement, the Plan, the Ballots, the Solicitation Packages, and all other documents and matters related thereto, including the procedures and requirements for voting to accept or reject the Plan and for objecting to the Plan; (d) soliciting votes on the Plan; and (e) if necessary, contacting creditors regarding the Plan. D. The Court Should Approve the Forms of the Ballots. 25. Bankruptcy Rule 3018(c) requires that an acceptance or rejection shall be in writing, identify the plan or plans accepted or rejected, be signed by the creditor or equity security holder or an authorized agent, and conform to the appropriate Official Form. Fed. R. Bankr. P. 3018(c). In accordance with Bankruptcy Rule 3018(c), the Debtors have prepared and customized ballots for each Voting Class and a master ballot to the nominees in respect of the holders of Claims arising under any indentures (collectively, the Ballots ), in substantially the form of the Ballots attached as Exhibits 2A 2C to Exhibit A. Although based on Official Form No. 14, the Ballots have been modified to (a) address the particular circumstances of these chapter 11 cases, and (b) include certain additional information that is relevant and appropriate for Claims in certain of the Voting Classes. The Debtors respectfully submit that the forms of the Ballots comply with Bankruptcy Rule 3018(c) and, therefore, should be approved. 14
Pg 18 of 114 26. In addition to accepting hard copy Ballots via first class mail, overnight courier, and hand delivery, the Debtors request authorization to accept Ballots via electronic, online transmissions through a customized online balloting portal on the Debtors case website. Parties entitled to vote may cast an electronic Ballot and electronically sign and submit a Ballot instantly by utilizing the online balloting portal (which allows a holder to submit an electronic signature). Instructions for electronic, online transmission of Ballots are set forth on the forms of Ballots. The encrypted ballot data and audit trail created by such electronic submission shall become part of the record of any Ballot submitted in this manner and the creditor s electronic signature will be deemed to be immediately legally valid and effective. The Debtors request that Ballots submitted via the customized online balloting portal shall be deemed to contain an original signature. E. The Court Should Approve the Confirmation Hearing Notice. 27. The Confirmation Hearing Notice includes the following: (a) instructions as to how to view or obtain copies of the Disclosure Statement (including the Plan and the other exhibits thereto), the order approving the Disclosure Statement (the Disclosure Statement Order ), and all other materials in the Solicitation Package (excluding Ballots) from the Solicitation Agent and/or the Court s website via PACER; (b) notice of the Voting Deadline; (c) notice of the date by which the Debtors will file the Plan Supplement; (d) notice of the deadline by which to object to the Plan; and (e) notice of the Confirmation Hearing and information related thereto. The Debtors will serve the Confirmation Hearing Notice on all known holders of Claims and Interests and the 2002 List (regardless of whether such parties are entitled to vote on the Plan) by no later than July 9, 2018. 28. Bankruptcy Rule 2002(l) permits the Court to order notice by publication if it finds that notice by mail is impracticable or that it is desirable to supplement the notice. Fed. R. Bankr. P. 2002(l). Therefore, in addition to the foregoing distribution of the Confirmation Hearing 15
Pg 19 of 114 Notice, the Debtors will publish the Confirmation Hearing Notice one time on or before July 9, 2018, in the national editions of The Wall Street Journal and The New York Times. The Debtors believe that the publication of the Confirmation Hearing Notice will provide sufficient notice of, among other things, the entry of the Disclosure Statement Order, the Voting Deadline, the deadline by which to object to the Plan, and the Confirmation Hearing to parties who did not otherwise receive notice by mail. Additionally, service and publication of the Confirmation Hearing Notice comports with the requirements of Bankruptcy Rule 2002 and should be approved. F. The Court Should Approve the Form and Distribution of Solicitation Packages to Parties Entitled to Vote on the Plan. 29. Bankruptcy Rule 3017(d) specifies the materials to be distributed to holders of allowed claims and/or equity interests upon approval of a disclosure statement, including the court-approved plan and disclosure statement and notice of the time within which acceptances and rejections of the plan may be filed. Fed. R. Bankr. P. 3017(d). In accordance with this requirement, the Debtors propose to send the Solicitation Packages to provide holders of Claims in the Voting Classes with the information they need to be able to make informed decisions with respect to how to vote on the Plan. Specifically, on or before the Solicitation Deadline, the Debtors will cause the Solicitation Packages to be distributed through their Solicitation Agent (by first-class U.S. mail) to those holders of Claims in the Voting Classes. The Solicitation Package will include the following materials: a. a copy of the Solicitation and Voting Procedures; b. a Ballot, together with detailed voting instructions and a pre-addressed, postage pre-paid return envelope; c. a cover letter; d. the Disclosure Statement (and exhibits thereto, including the Plan); e. the Disclosure Statement Order (without exhibits); 16
Pg 20 of 114 f. the Confirmation Hearing Notice; and g. such other materials as the Court may direct. 30. The Debtors request that they be authorized to distribute the Plan, the Disclosure Statement, and the Disclosure Statement Order (without exhibits) to holders of Claims entitled to vote on the Plan in electronic format (flash drive or CD-ROM). The Ballots, the Solicitation and Voting Procedures, the cover letter, and the Confirmation Hearing Notice will be provided in paper format. Distribution in this manner will translate into significant monetary savings for the Debtors estates given the length of the Plan, Disclosure Statement, and Disclosure Statement Order. 31. Additionally, the Debtors will provide complete Solicitation Packages (excluding the Ballots) to the U.S. Trustee and all parties on the 2002 List as of the Voting Record Date. Any party that receives the material in electronic format but would prefer paper format may contact the Solicitation Agent and request paper copies of the corresponding materials previously received in electronic format (to be provided at the Debtors expense). The Debtors further request that they not be required to mail Solicitation Packages or other solicitation materials to (a) holders of Claims that have already been paid in full during these chapter 11 cases or that are authorized to be paid in full in the ordinary course of business pursuant to an order previously entered by this Court or (b) any party to whom notice of the Disclosure Statement Hearing was sent but was subsequently returned as undeliverable. G. The Court Should Approve the Form of Notices to Non-Voting Classes. 32. As discussed above, the Non-Voting Classes are not entitled to vote on the Plan. As a result, they will not receive Solicitation Packages and, instead, the Debtors propose that such parties receive a Non-Voting Status Notice. Specifically, in lieu of solicitation materials, the 17
Pg 21 of 114 Debtors propose to provide the following to holders of Claims and Interests in Non-Voting Classes (each, a Non-Voting Status Notice ): a. Unimpaired Claims Conclusively Presumed to Accept. Holders of Claims in Classes 1, 2, and 3 are not impaired under the Plan and, therefore, are conclusively presumed to have accepted the Plan. As such holders of such Claims will receive a notice, substantially in the form attached as Exhibit 3 to Exhibit A, in lieu of a Solicitation Package. b. Other Interests and Claims Deemed to Reject. Holders of Interests in Classes 7 and 9 are receiving no distribution under the Plan and, therefore, are deemed to reject the Plan and will receive a notice, substantially in the form attached as Exhibit 4 to Exhibit A, in lieu of a Solicitation Package. c. Disputed Claims. Holders of Claims that are subject to a pending objection by the Debtors are not entitled to vote the disputed portion of their claim. As such, holders of such Claims will receive a notice, substantially in the form attached as Exhibit 5 to Exhibit A. 33. The Debtors will not provide the holders in Class 6 (Intercompany Claims) and Class 8 (Intercompany Interests) with a Solicitation Package or any other type of notice in connection with solicitation. Intercompany Claims will either be reinstated, converted to equity, or cancelled, and Intercompany Interest will either be reinstated or discharged, cancelled, released, and extinguished. Thus, the holders of Intercompany Claims or Intercompany Interests will not be entitled to vote to accept or reject the Plan. Nevertheless, in light of the fact that the Intercompany Claims and Intercompany Interests are all held by the Debtors or affiliates of the Debtors, the Debtors are requesting a waiver from any requirement to serve such holders of Intercompany Claims or Intercompany Interests with any notices or the Solicitation Package. 34. Each of the Non-Voting Status Notices will include, among other things: (a) instructions as to how to view or obtain copies of the Disclosure Statement (including the Plan and the other exhibits thereto), the Disclosure Statement Order, and all other materials in the Solicitation Package (excluding Ballots) from the Solicitation Agent and/or the 18
Pg 22 of 114 Court s website via PACER; (b) a disclosure regarding the settlement, release, exculpation, and injunction language set forth in Article VIII of the Plan as well as a means of opting out of the aforementioned release; (c) notice of the Plan Objection Deadline; and (d) notice of the Confirmation Hearing and information related thereto. 35. The Debtors believe that the mailing of Non-Voting Status Notices in lieu of Solicitation Packages satisfies the requirements of Bankruptcy Rule 3017(d). Accordingly, unless the Court orders otherwise, the Debtors do not intend to distribute Solicitation Packages to holders of Claims and Interests in the Non-Voting Classes. H. The Court Should Approve the Notices to Contract and Lease Counterparties. 36. Executory Contracts and Unexpired Leases are deemed assumed under the Plan unless, among other things, such Executory Contracts or Unexpired Leases are expressly set forth on the Rejected Executory Contracts and Unexpired Leases Schedule which will be included as part of the Plan Supplement. As soon as reasonably practicable after the Solicitation Deadline, the Debtors will provide notices to counterparties of Executory Contracts and Unexpired Leases, substantially in the forms attached as Exhibit 8 and Exhibit 9 to Exhibit A, regarding the proposed treatment of Executory Contracts and Unexpired Leases under the Plan, information pertaining to deadlines to object to such treatment, including with respect to Cure Claim and adequate assurance under section 365 of the Bankruptcy Code, and instructions for filing a Claim for potential rejection damages. 37. Additionally, to ensure that counterparties to Executory Contracts and Unexpired Leases receive notice of the Confirmation Hearing, the Debtors will serve such parties with the Confirmation Hearing Notice. If any of these entities also is a holder of a Claim in a Voting Class as of the Voting Record Date, such entity will also receive a Solicitation Package in accordance 19
Pg 23 of 114 with the Solicitation Procedures. The Debtors respectfully submit that these notices comply with the Bankruptcy Code and, therefore, should be approved. IV. The Court Should Establish the Date of the Confirmation Hearing. 38. Section 1128 of the Bankruptcy Code provides that a court shall hold a hearing on confirmation of a plan and provides that parties in interest can object to confirmation. 11 U.S.C. 1128. Additionally, Bankruptcy Rule 3017(c) provides that, on or before approval of a disclosure statement, a court shall fix a time for the hearing on confirmation of a plan. Fed. R. Bankr. P. 3017(c). In accordance with Bankruptcy Rule 3017(c) and section 1128 of the Bankruptcy Code, the Debtors request that the Court set August 14, 2018, at a time convenient for the Court, as the start of the Confirmation Hearing. The Debtors further request that the Confirmation Hearing may be continued from time to time by the Court or the Debtors without further notice to parties in interest other than such adjournment announced in open court and/or a notice of adjournment filed with the Court and served on the 2002 List. Non-Substantive Modifications 39. The Debtors request authorization to make non-substantive changes to the Disclosure Statement, the Plan, the Solicitation and Voting Procedures, the Confirmation Hearing Notice, the Non-Voting Status Notices, the Ballots, the proposed cover letter, the Assumption and Rejection Notices, and related documents without further order of the Court and consistent in all material respects with the RSA, including changes to correct typographical and grammatical errors, if any, and to make conforming changes to the Disclosure Statement, the Plan, and any other materials in the Solicitation Packages before distribution, in each case subject to the applicable consent rights of the parties to the RSA. 20
Pg 24 of 114 Motion Practice 40. This motion includes citations to the applicable rules and statutory authorities upon which the relief requested herein is predicated and a discussion of their application to this motion. Accordingly, the Debtors submit that this motion satisfies Local Rule 9013-1(a). Notice 41. The Debtors have provided notice of this motion to the entities on the Service List (as defined in the case management order in these chapter 11 cases [Docket No. 107] and available on the Debtors case website at https://cases.primeclerk.com/ninewest). The Debtors submit that, in light of the nature of the relief requested, no other or further notice need be given. No Prior Request 42. No prior request for the relief sought in this motion has been made to this or any other court. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 21
Pg 25 of 114 WHEREFORE, the Debtors respectfully request entry of an order, substantially in the form attached hereto as Exhibit A, granting the relief requested herein and granting such other relief as is just and proper. New York, New York Dated: May 2, 2018 /s/ Joseph M. Graham James H.M. Sprayregen, P.C. Christopher J. Marcus, P.C. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 - and - James A. Stempel (admitted pro hac vice) Joseph M. Graham (admitted pro hac vice) Angela M. Snell (admitted pro hac vice) KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Street Chicago, Illinois 60654 Telephone: (312) 862-2000 Facsimile: (312) 862-2200 Proposed Counsel to the Debtors and Debtors in Possession
Pg 26 of 114 Exhibit A Disclosure Statement Order
Pg 27 of 114 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ) In re: ) Chapter 11 ) NINE WEST HOLDINGS, INC., et al., 1 ) Case No. 18-10947 (SCC) ) Debtors. ) (Jointly Administered) ) ) Re: Docket No. ORDER (I) APPROVING (A) THE ADEQUACY OF THE DISCLOSURE STATEMENT, (B) SOLICITATION AND NOTICE PROCEDURES, AND (C) CERTAIN DATES WITH RESPECT TO PLAN CONFIRMATION, AND (II) GRANTING RELATED RELIEF Upon the motion (the Motion ) 2 of the Debtors for entry of an order (this Order ) pursuant to sections 105, 363, 1125, 1126, and 1128 of the Bankruptcy Code, Bankruptcy Rules 2002, 3016, 3017, 3018, 3020 and Local Rules 3017-1, 3018-1, and 3020-1, (a) approving the Disclosure Statement for the Debtors Joint Plan of Reorganization Pursuant to Chapter 11 of the Bankruptcy Code (the Disclosure Statement ), (b) approving Solicitation and Voting Procedures, (c) approving the confirmation schedule, and (d) granting related relief; and this Court having jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334 and the Amended Standing Order of Reference from the United States District Court for the Southern District of New York, dated January 31, 2012; and this Court having the power to enter a final order consistent with Article III of the United States Constitution; and this Court having found that venue of this proceeding and the Motion in this district is proper pursuant to 28 U.S.C. 1408 and 1409; and 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are: Nine West Holdings, Inc. (7645); Jasper Parent LLC (4157); Nine West Management Service LLC (4508); Kasper Group LLC (7906); Kasper U.S. Blocker LLC (2390); Nine West Apparel Holdings LLC (3348); Nine West Development LLC (2089); Nine West Distribution LLC (3029); Nine West Jeanswear Holding LLC (7263); One Jeanswear Group Inc. (0179); and US KIC Top Hat LLC (3076). The location of the Debtors service address is: 1411 Broadway, New York, New York 10018. 2 Capitalized terms used but not otherwise defined herein shall have the meanings set forth in the Motion.
Pg 28 of 114 this Court having found that the Debtors notice of the Motion and opportunity for a hearing on the Motion were appropriate under the circumstances and no other notice need be provided; and this Court having reviewed the Motion and having heard the statements in support of the relief requested therein at a hearing before this Court (the Hearing ); and this Court having determined that the legal and factual bases set forth in the Motion and at the Hearing establish just cause for the relief granted herein; and upon all of the proceedings had before this Court; and after due deliberation and sufficient cause appearing therefor, it is HEREBY ORDERED THAT: 1. The Motion is granted as set forth herein. 2. The Disclosure Statement is hereby approved as providing holders of Claims entitled to vote on the Plan with adequate information to make an informed decision as to whether to vote to accept or reject the Plan in accordance with section 1125(a)(1) of the Bankruptcy Code. 3. The Disclosure Statement (including all applicable exhibits thereto) provides holders of Claims, holders of Interests, and other parties in interest with sufficient notice of the injunction, exculpation, and release provisions contained in Article VIII of the Plan, in satisfaction of the requirements of Bankruptcy Rule 3016(c). 4. The Debtors provided adequate and sufficient notice of the hearing to consider approval of the Disclosure Statement, the manner in which a copy of the Disclosure Statement (and exhibits thereto, including the Plan) could be obtained, and the time fixed for filing objections thereto, in satisfaction of the requirements of the applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, and the Local Rules. 5. The following dates are hereby established (subject to modification as necessary) with respect to the solicitation of votes to accept or reject the Plan and confirmation of the Plan: a. Voting Record Date: June 28, 2018, as the date for determining: (a) holders of Claims that are entitled to vote on the Plan and (b) whether 2