We are advising SVPGlobal and its affiliated funds as plan sponsor in connection with the restructuring

Davis Polk is advising SVPGlobal and its affiliated funds in connection with the chapter 11 restructurings of Washington Prime Group, Inc. and certain of its subsidiaries (the “Company”). On June 13, Washington Prime filed its voluntary chapter 11 petitions in the United States Bankruptcy Court for the Southern District of Texas after executing a restructuring support agreement (the “RSA”) with creditors, led by SVPGlobal, as plan sponsor, and including an ad hoc group of lenders, that hold approximately 73% of the principal amount outstanding of the Company’s secured corporate debt and 67% of the principal amount outstanding of the Company’s unsecured notes. In connection with the chapter 11 filing, Washington Prime Group obtained a $100 million delayed-draw debtor-in-possession financing facility from SVPGlobal and the ad hoc lender group to support day-to-day operations during the Chapter 11 process. 

The RSA provides for a deleveraging of the Company’s balance sheet by nearly $950 million through the equitization of unsecured notes and a $190 million paydown of the Company’s revolving credit and term loan facilities. The RSA contemplates a $325 million equity rights offering, fully backstopped by SVPGlobal, the proceeds of which will be applied to, among other things, the pay down of secured debt. The RSA also provides for a consensual takeback paper exit facility, payment in full of all claims held by vendors and service providers, and a recovery for the company’s existing common and preferred equity holders of $40 million in cash or 6.125% of new equity (subject to dilution). Additionally, the RSA allows the company to market its assets to determine whether an alternative transaction that repays existing corporate indebtedness in full, in cash, and delivers greater aggregate recoveries to existing common and preferred equity holders is attainable.

At hearings held on June 14 and June 17, 2021, Washington Prime obtained all of the “first day” relief it sought, including interim approval of the debtor-in-possession financing facility.

Washington Prime Group Inc. is a retail REIT and a national leader in the ownership, management, acquisition and development of retail properties with 102 shopping centers across the United States.

The Davis Polk restructuring team includes partners Damian S. Schaible and Angela M. Libby, counsel Aryeh Ethan Falk and associate Stella Li. The real estate team includes partner Brian D. Hirsch, counsel Susan D. Kennedy and associate David Beizer. The finance team includes counsel Christian Fischer. The tax team includes partner Patrick E. Sigmon. Partner William L. Taylor is advising on corporate matters and partner Nicholas A. Kronfeld is advising on securities law. All members of the Davis Polk team are based in the New York office.

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