Weil Acts For Fossil Group As High Court Sanctions Restructuring Plan

Overview

On November 10, 2025, the English High Court sanctioned the groundbreaking Part 26A restructuring plan of Fossil (UK) Global Services Ltd (the "Plan Company"), a subsidiary of Fossil Group, Inc. ("FGI").

The restructuring plan is notable for its successful implementation by a publicly listed United States headquartered group of a compromise of claims from predominantly United States based noteholders, while maintaining its listing throughout the restructuring process. The use of a restructuring plan by a U.S. issuer highlights the increasing cross-border utility of the restructuring regime in England and Wales.

The transaction framework, designed by Weil, is the first instance where:

• a public exchange offer registered with the United States Securities and Exchange Commission had been successfully backstopped by an English restructuring plan whilst maintaining the NASDAQ shares' listing.
• a restructuring plan involving a single class of plan creditors was sanctioned by the Court.

Background

The restructuring plan relates to FGI's US $150 million 7.00% senior unsecured notes due 30 November 2026 (the "Notes"). In September 2025 FGI announced the commencement of a public exchange offer relating to the Notes, which was to be backstopped by the restructuring plan in the event the "Minimum Tender Condition" (which required the tender of 90% of the aggregate principal amount of the Notes in the exchange offer) was not met by the relevant deadline. Following expiry of the relevant deadline in October 2025 and, as a result of the Minimum Tender Condition not having been met, FGI announced that it would proceed to restructure the Notes via the restructuring plan and subsequently sought directions from the court to convene a single meeting of plan creditors to consider, and if they thought fit, vote on the restructuring plan.

On November 6, 2025, the plan meeting was held and the restructuring plan was approved by the requisite majority. With creditor approval secured, the sanction hearing was held on November 10, 2025 and on November 12, 2025, the United States Bankruptcy Court for the Southern District of Texas granted Chapter 15 recognition in the United States of America of the restructuring plan.

By securing creditor approval, court sanction and Chapter 15 recognition, the restructuring plan offers a complete solution to the Notes, binding all noteholders to the terms of the Restructuring plan, securing a result that would not otherwise have been available to Fossil group through a restructuring procedure in the United States.

Key Structural Considerations

• Noteholder Composition and Identification: The Notes were widely held by a range of institutional and retail investors. Due to the holding structure through the Depository Trust Company, the identification of the underlying beneficial owners was not readily possible. This created a substantial challenge to the implementing a consensual restructuring which required the participation of at least 90% of Noteholders.
• Single Class Restructuring Plan: The adoption of a single class restructuring plan presented a unique opportunity to enhance the certainty of the restructuring process. Although supporting holders that were party to the transaction support agreement collectively held approximately 61% of the Notes through various funds, FGI understood that around 24% of the Notes were likely held by retail investors across approximately 1,500 separate accounts. As a result, there was significant uncertainty as to whether the requisite numerosity threshold could be satisfied under a scheme of arrangement. To address this, a single class restructuring plan was proposed. This is not subject to the same numerosity requirement and provides the additional advantage of enabling a cram-down in the event that the court, at the convening hearing, were to determine that creditors' rights were too dissimilar to consult together as a single class.
• Impact on FGI's Public Listing and Operations: FGI is a publicly listed company and maintained several key operating contracts with the group's suppliers. Any formal restructuring or insolvency process commenced at or proposed at the FGI level would likely have had adverse consequences for its public listing and could have jeopardized the continuation of these critical supplier agreements.
• Jurisdictional Considerations: The Notes were governed by New York law. To utilise the restructuring framework available in England and Wales, it was necessary to further establish connection to the jurisdiction of the English Court, which was achieved through: (i) the Plan Company's accession to the Notes as a guarantor; (ii) the Plan Company and FGI entering into a Deed of Contribution pursuant to which the Plan Company undertook to contribute to FGI any amounts that are paid by FGI towards FGI's obligations under the Notes; and (iii) Noteholders consenting to change the governing law of the Notes to the laws of England and Wales.

Conclusion

An English law restructuring plan provided a unique and effective solution to the challenges faced by the Fossil group.

• It enabled FGI, via the Plan Company, to implement a comprehensive restructuring of the Notes, notwithstanding the dispersed nature of the retail noteholder base, while avoiding the consequences associated with a formal insolvency process in the United States.
• It confirmed that seeking to avoid Chapter 11 can constitute a bona fide reason for pursuing a U.K. process. The court described this as an example of "good forum shopping" and accepted that the advantages an English restructuring plan (in particular, its ability to enable the restructuring of a targeted creditor group) justified Fossil's approach of seeking to restructure in the UK.

The flexibility of the restructuring regime in England and Wales, its ability to bind all creditors into a solution and to accommodate cross-border elements, offered a practical and efficient mechanism to achieve the desired restructuring outcome

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