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8-K - FORM 8-K - Kate Spade & Co | y90648e8vk.htm |
EX-99.2 - EX-99.2 - Kate Spade & Co | y90648exv99w2.htm |
Exhibit 99.1
Liz Claiborne, Inc. Announces Pricing of Senior Secured Notes Offering
NEW YORK April 1, 2011 Liz Claiborne, Inc. (NYSE: LIZ) (the Company) today announced that it
priced an offering of $205.0 million aggregate principal amount of Senior Secured Notes due 2019
(the Notes). The initial offering of $200.0 million was upsized to $205.0 million. The Notes
were priced at par and will bear interest at an annual rate of 10.50%. The offering of the Notes
is expected to close on April 7, 2011.
The Company plans to use the net proceeds from the offering primarily to fund the previously
announced cash tender offer to purchase up to 155.0 million of its outstanding 350.0 million 5.0%
Notes due 2013 (the Euro Notes), of which 118.0 million had been tendered as of March 31, 2011,
and to pay related fees, expenses and commissions, along with accrued and unpaid interest on the
tendered Euro Notes. Any remaining proceeds will be used for general corporate purposes. The
Notes will be guaranteed on a senior secured basis by certain of the Companys current and future
domestic subsidiaries. The Notes and the guarantees will be secured on a first-priority basis by a
lien on certain of the Companys trademarks and by a second-priority interest in the Companys and
the guarantors assets that secure the Companys revolving credit facility.
The Notes are being offered to qualified institutional buyers pursuant to Rule 144A under the
Securities Act of 1933, as amended (the Securities Act), and to persons outside of the United
States in compliance with Regulation S under the Securities Act. The issuance and sale of the
Notes have not been registered under the Securities Act, and the Notes may not be offered or sold
in the United States absent registration or an applicable exemption from registration requirements.
This press release does not constitute an offer to sell or a solicitation of an offer to buy the
Notes, nor shall there be any offer, solicitation or sale of any Notes in any jurisdiction in which
such offer, solicitation or sale would be unlawful.
Forward-Looking Statements
Statements contained herein that relate to the Companys future performance, financial condition,
liquidity or business or any future event or action are forward-looking statements under the
Private Securities Litigation Reform Act of 1995. Such statements are indicated by words or phrases
such as intend, anticipate, plan, estimate, target, forecast, project, expect,
believe, we are optimistic that we can, current visibility indicates that we forecast or
currently envisions and similar phrases. Such statements are based on current expectations only,
are not guarantees of future performance, and are subject to certain risks, uncertainties and
assumptions. The Company may change its intentions, belief or expectations at any time and without
notice, based upon any change in the Companys assumptions or otherwise. Should one or more of
these risks or uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those anticipated, estimated or projected. In
addition, some risks and uncertainties involve factors beyond the Companys control. Among the
risks and uncertainties are the following: our ability to continue to have the necessary liquidity,
through cash flows from operations, and availability under our amended and restated revolving
credit facility may be adversely impacted by a number of factors, including the level of our
operating cash flows, our ability to maintain established levels of availability under, and to
comply with the financial and other covenants included in, our amended and restated revolving
credit facility and the borrowing base requirement in our amended and restated revolving credit
facility that limits the amount of borrowings we may make based on a formula of, among other
things, eligible accounts receivable and inventory; the minimum availability covenant in our
amended and restated revolving credit facility that requires us to maintain availability in excess
of an agreed upon level and whether holders of our Convertible Notes issued in June 2009 will, if
and when such notes are convertible, elect to convert a substantial portion of such notes, the par
value of which we must currently settle in cash; general economic conditions in the United States,
Europe and other parts of the world; lower levels of consumer confidence, consumer spending and
purchases of discretionary items, including fashion apparel and related products, such as ours;
continued restrictions in the credit and capital markets, which would impair our ability to access
additional sources of liquidity, if needed; changes in the cost of raw materials, labor,
advertising and transportation, including the impact such changes may have on the pricing of our
product and the resulting impact on consumer acceptance of our products at higher price points; our
dependence on a limited number of large US department store customers, and the risk of
consolidations, restructurings, bankruptcies and other ownership changes in the retail industry and
financial difficulties at our larger department store customers; our ability to effect a turnaround
of our Mexx Europe business; our ability to successfully re-launch our Lucky Brand product
offering; our ability to successfully implement our long-term strategic plans; risks associated
with the licensing arrangements with J.C. Penney Corporation, Inc. and J.C. Penney Company, Inc.
and with QVC, Inc., including, without limitation, our ability to efficiently change our
operational model and infrastructure as a result of such licensing arrangements, our ability to
continue a good working relationship with these licensees and possible changes or disputes in our
other brand relationships or relationships with other retailers and existing licensees as a result;
our ability to anticipate and respond to constantly changing consumer demands and tastes and
fashion trends across multiple brands, product lines, shopping channels and geographies; our
ability to attract and retain talented, highly qualified executives, and maintain satisfactory
relationships with our employees, both union and non-union; possible exposure to multiemployer
union pension plan liability as a result of current market conditions and possible withdrawal
liabilities; our ability to adequately establish, defend and protect our trademarks and other
proprietary rights; our ability to successfully develop or acquire new product lines or enter new
markets or product categories, and risks related to such new lines, markets or categories; the
impact of the highly competitive nature of the markets within which we operate, both within the US
and abroad; our reliance on independent foreign manufacturers, including the risk of their failure
to comply with safety standards or our policies regarding labor practices; risks associated with
our agreement with Li & Fung Limited, which results in a single foreign buying/sourcing
agent for a significant portion of our products; a variety of legal, regulatory, political and
economic factors that can impact our operations and results and the shopping and spending patterns
of consumers, including risks related to the importation and exportation of product, tariffs and
other trade barriers, to which our international operations are subject; our ability to adapt to
and compete effectively in the current quota environment in which general quota has expired on
apparel products but political activity seeking to re-impose quota has been initiated or
threatened; our exposure to domestic and foreign currency fluctuations; risks associated with
material disruptions in our information technology systems; risks associated with privacy breaches;
limitations on our ability to utilize all or a portion of our US deferred tax assets if we
experience an ownership change; the outcome of current and future litigations and other
proceedings in which we are involved; and such other factors as are set forth in the Companys 2010
Annual Report on Form 10-K, filed on February 17, 2011 with the Securities and Exchange Commission,
including in the section entitled Item 1A- Risk Factors. The Company undertakes no obligation to
publicly update or revise any forward-looking statement, whether as a result of new information,
future events or otherwise.