NexCen Brands Sells Bill Blass Licensing Business

NexCen Brands, Inc., the parent of The Athlete's Foot, completed the sale of its Bill Blass licensing business to Peacock International Holdings, LLC on Dec. 24, 2008 pursuant to an asset purchase agreement executed on the same day.

Under the terms of the asset purchase agreement, Peacock International purchased substantially all of the assets related to the Bill Blass licensing business for approximately $10.0 million in cash. NexCen said it will use the proceeds from the sale, net of certain transaction costs, to pay down the debt associated with the Bill Blass business.

Rothschild Inc. acted as the financial advisor to NexCen. In conjunction with the sale of its Bill Blass licensing business, NexCen entered into an amendment of its existing credit facility with BTMU Capital Corporation (“BTMUCC”). Under the terms of the credit facility, the approximate remaining balance of $14.2 million on the note that was related to the Bill Blass licensing business was converted into a deficiency note that bears interest at 15% a year.

The amendment extends the maturity date of the deficiency note from Jan. 1, 2010 until July 31, 2013; defers the scheduled principal payment obligations on the deficiency note until its maturity date; permits payment-in-kind of interest to defer interest payments during the term of the note; and provides that BTMUCC will not be entitled to receive warrants to purchase 2.8 million shares of the Company's common stock at an exercise price of 1 cent per share even if the deficiency note remains outstanding after Mar. 31, 2009.

Kenneth J. Hall, CEO of NexCen Brands, stated, “The completion of the sale of Bill Blass is an important final step in the execution of our strategy to divest certain non-core assets and focus exclusively on our franchising business. We are gratified by the ongoing support of our lender as we continue to execute on our revised business strategy. As we look forward to 2009, we now are fully focused on our seven franchised brands in the retail and quick service restaurant sectors.”