Neiman Marcus extends early exchange offer deadline for 2021 notes

By Marisa Wong

Morgantown, W.Va., May 13 – Neiman Marcus Group Ltd. LLC said it received tenders for at least $1,477,000,000 of notes as of 5 p.m. ET on May 10, the original early tender date of its previously announced offers to exchange any and all of its outstanding $960 million 8% senior cash pay notes due 2021 and $655,746,580 8¾%/9½% senior PIK toggle notes due 2021 for a combination of preferred stock and new notes.

On Monday the company said it is extending the early tender date to 5 p.m. ET on May 15.

Holders who tender their notes by the new early tender date will be eligible to receive on a par-for-par basis a combination of (a) non-voting cumulative preferred shares of series A preferred stock of MYT Holding Co., a U.S. holding company that will indirectly hold, prior to the settlement date of the exchange offers, NMG Germany GmbH, which holds and conducts the operations of MyTheresa, accruing dividends at a rate of 10% per annum and (b) new third-lien notes due 2024 bearing interest payable in cash at a rate of 8% per year for exchanged existing cash pay notes and 8¾% per year for exchanged existing PIK toggle notes.

Specifically, holders will receive for each $1,000 principal amount of existing cash pay notes tendered by the early tender date $845.27 principal amount of new 8% third-lien notes and 154.72723451 shares of MYT series A preferred stock; and holders will receive for each $1,000 principal amount of existing PIK toggle notes tendered by the early tender date $845.27 principal amount of new 8¾% third-lien notes and 154.72723451 shares of MYT series A preferred stock.

Holders who tender after the early tender date will receive new third-lien notes on a par-for-par basis.

Specifically, holders will receive for each $1,000 principal amount of existing cash pay notes tendered after the early deadline $1,000 principal amount of new 8% third-lien notes; and holders will receive for each $1,000 principal amount of existing PIK toggle notes tendered after the early deadline $1,000 principal amount of new 8¾% third-lien notes.

In addition, holders will receive cash amounts for accrued interest for their exchanged notes up to but excluding the settlement date.

Concurrently, the company is soliciting consents from holders to some proposed amendments to the indentures governing the existing notes to remove substantially all of the restrictive covenants and effect some other changes.

The company said on Monday it has received sufficient consents to approve the proposed amendments and will enter into supplemental indentures containing those amendments, but those changes will not become operative until the exchange offers settle.

The exchange offers will expire at 11:59 p.m. ET on May 24.

Tenders may no longer be withdrawn.

The settlement date for the offers will occur on or prior to the fifth business day following the expiration date. The company expects to complete the exchange offers and consent solicitations at about the same time that it issues $550 million of new second-lien notes and amends and extends its senior secured term loan facility.

Each exchange offer is conditioned on, among other things related to the company’s restructuring, the tender of at least 95% of the aggregate outstanding principal amount of the existing notes, provided that the 95% threshold may be lowered by the company at its discretion; and the delivery of the consents with respect to more than 50% of the aggregate principal amount of each series of the existing notes.

Adoption of the amendments to each existing indenture requires the consent of holders of a majority of the outstanding principal amount of the existing notes governed by that indenture.

Holders who tender their notes for exchange will be deemed to have delivered their related consents.

In a press release on April 30, the company said holders of about 90.8% of the existing notes had entered into its previously announced transaction support agreement that also includes holders of its term loans and had agreed to deliver consents to amend the existing indentures.

D.F. King & Co., Inc. (www.dfking.com/nmg or 866 751-6310 or nmg@dfking.com) is the information agent for the Rule 144A and Regulation S exchange offer.

Neiman Marcus is a Dallas-based high-end department store and catalog retailer.

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