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Lucky Brand Dungarees files liquidation plan; statement hearing Oct. 2
By Caroline Salls
Pittsburgh, Aug. 31 – Lucky Brand Dungarees, LLC filed a plan of liquidation and related disclosure statement Friday with the U.S. Bankruptcy Court for the District of Delaware.
Lucky Brand said it completed the sale of substantially all of its assets on Aug. 14.
The credit bid approved as part of the sale transaction extinguished the company’s debtor-in-possession financing, as well as a portion of its second-lien term loan claims. In addition, some sale proceeds were used at closing to pay off Lucky’s first-lien lenders.
According to the disclosure statement, the remaining net sale proceeds were used to fund accounts established by the Lucky debtors and Young Conaway Stargatt & Taylor, as well as to fund the payment to the second-lien lenders, all in accordance with the sale order.
The plan provides for distribution of net sale proceeds remaining as of the plan effective date.
The initial distribution to class 3 creditors and a wind-down reserve will be funded from cash on hand, including any remaining net sale proceeds.
The distributions will be made by a plan administrator.
Administrative claims, priority tax claims and other priority claims will be paid in full in cash.
Other secured claims will be paid in full in cash or holders will receive the collateral securing the claims.
Since second-lien claims are not expected to be paid in full, holders of general unsecured claims will receive no distribution.
Holders of existing interests will receive no distribution.
The disclosure statement hearing is scheduled for Oct. 2.
Lucky is a Los Angeles-based fashion designer and premium denim manufacturer. The company filed bankruptcy on July 3 under Chapter 11 case number 20-11768.
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