NBG Home gets OK of disclosure statement, DIP loan, bid procedures

By Sarah Lizee

Olympia, Wash., March 2 – Nielsen & Bainbridge, LLC, which does business as NBG Home, received conditional approval of the disclosure statement for its pre-packaged Chapter 11 plan, as well as final approval of a debtor-in-possession facility and bid procedures for the sale of its assets, according to orders filed Wednesday with the U.S. Bankruptcy Court for the Southern District of Texas.

A combined hearing on the plan and disclosure statement is scheduled for April 4.

As previously reported, the prearranged plan aims to reduce long-term debt by about $350 million from $413 million.

The company has entered into a restructuring support agreement and stalking horse agreement with lenders holding the majority of its debt, comprised of credit funds and accounts managed by KKR Credit Advisors (US) LLC and funds managed by Silver Point Capital, LP.

Under the agreement, the company will receive a $60 million debtor-in-possession facility via KKR and Silver Point. The facility consists of $30 million in new money and a $30 million rollup of prepetition loans.

The DIP facility matures in two months and bears interest at SOFR plus 1,000 basis points, payable in kind and subject to a SOFR floor of 1%. Default interest would be an additional 2% above the interest rate.

There is a PIK commitment premium of 5% on the new money.

As sponsors of the restructuring plan, KKR and Silver Point offered to acquire the company through a credit bid against the DIP and amounts outstanding under a $57.7 million asset-based lending facility, unless a higher or better bid emerges during the process.

Under the bid procedures, the bid deadline is 6 p.m. ET on March 27, an auction will be held on March 30, and a sale hearing will be held on April 4.

Creditor treatment

Under the plan, administrative claims and priority tax claims will be paid in full.

Other secured claims and other priority claims are unimpaired.

If KKR and Silver Point are the plan sponsors, holders of DIP claims will receive payment in full in cash on account of the rollup loans, and a pro rata share of an equal amount of the exit term loans or cash on account of the new money loans. If any other party is the plan sponsor, DIP lenders will receive payment in full in cash.

If KKR and Silver Point are the plan sponsors, ABL lenders will receive either their pro rata share of a new ABL credit facility or payment in full in cash. If any other party is the plan sponsor, ABL lenders will receive payment in full in cash.

The first-lien term loan lenders, second-lien term loan lenders and general unsecured creditors will receive their pro rata share of additional value, if any, from a higher or better bid than what KKR and Silver Point currently offer.

Intercompany claims and interests will be reinstated, set off, settled, distributed, contributed, canceled or released, or otherwise addressed.

Section 510(b) claims will be discharged with no distribution.

Interests will be canceled with no recovery.

The home decor company is based in Austin, Tex. The company filed bankruptcy on Feb. 8 under Chapter 11 case number 23-90071.

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