Nationwide Credit again extends 10 ¼% '08 note exchange offer

NCI Holdings, Inc. and Nationwide Credit, Inc. (Ca) said on Friday (Aug. 23) that they had again extended their pending offer to exchange all of Nationwide's outstanding 10¼% senior notes due 2008 for common stock of NCI Holdings, Inc. The offer was extended to 5 p.m. ET on Aug. 30, subject to possible further extension, from the previous Aug. 23 deadline. Nationwide said that to date, it has received tenders of senior notes from the holders of approximately 71.3% of the outstanding notes under the terms of the exchange offer, down slightly from the 71.6% reported on Aug. 16.

AS PREVIOUSLY ANNOUNCED, NCI Holdings and Nationwide Credit Inc., a Kennesaw, Ga.-based financial services company, said on July 12 that their pending exchange offer for the 10¼% notes had been extended to 5 p.m. ET on July 19. The offer had not been publicly announced previously. The company said that as of July 12, it had received tenders of senior notes from the holders of approximately 67.9% of the outstanding notes under the terms of the exchange offer. On July 19, NCI and Nationwide announced that they had again extended the exchange offer to 5 p.m. ET on July 26 from the previous July 19 deadline, and said that as of the previous deadline, they had received tenders of approximately 68.5% of the outstanding notes, up from 67.9% reported on July 12, when the offer had last been previously extended. Although the exchange offer was subsequently extended past the July 26 deadline, no public announcement was made at that time; the next announcement, on Aug. 16, again extended the exchange offer to 5 p.m. ET on Aug. 23, subject to possible further extension, and said that to date, it had received tenders of senior notes from the holders of approximately 71.6% of the outstanding notes under the terms of the exchange offer, up from 68.5% reported on July 19. The transaction is being handled by State Street Bank and Trust Co., the depository for the offer as well as trustee for the notes.

Knology extends exchange offer for 0%/11 7/8% '07 notes

Knology, Inc. said on Friday (Aug. 23) that it had extended its previously announced offer to exchange new debt and new convertible preferred shares for the outstanding zero-coupon/11 7/8% senior discount notes due 2007 issued by its Knology Broadband Inc, subsidiary as part of a broader restructuring plan for the company. That offer has been extended to 5 p.m. ET on Sept. 6, subject to possible further extension, from the originally announced Aug. 22 deadline. Knology said that as of Aug. 22, it had received tenders of $353.3 million principal amount at maturity of existing notes, including guarantees of delivery, which represented 93% of the outstanding amount of the notes subject to the exchange offer, meaning those notes not currently held by another subsidiary of Knology.

AS PREVIOUSLY ANNOUNCED, Knology, a West Point, Ga.-based provider of bundled broadband communications services in the U.S. Southeast, said on July 16 that it had reached an agreement in principle with an informal committee of holders of the $444.1 million of outstanding Knology Broadband 11 7/8% notes on a restructuring plan that would significantly reduce the company's debt. Of the outstanding amount of notes, Valley Telephone Co., Inc., a wholly owned Knology subsidiary, owns $64.2 million, leaving $379.9 million of the notes in the hands of other holders. Knology said that including Valley, bondholders representing 79.4% of the outstanding notes had agreed to the terms of the restructuring plan and had agreed to tender their notes as part of the restructuring. In addition, both of Knology's senior secured lenders agreed to the terms of the restructuring plan, and certain existing stockholders committed to invest $39 million in new equity of Knology, contingent upon a successful restructuring.

Knology said that it anticipated commencing an exchange offer to effect the restructuring as soon as practicable. It said that under the terms of the restructuring, holders of the existing Knology notes not held by Valley Telephone, would be offered an aggregate of $193.5 million principal amount of new 12% senior notes due 2009 and shares of newly issued convertible preferred stock representing approximately 19.3% of Knology's outstanding post-restructuring common shares, on an as-converted basis. Of those amounts, noteholders who are also existing stockholders of Knology and who collectively own approximately $130.6 million of the existing notes would be offered an aggregate of $47.3 million of the new notes and approximately 14.4% of Knology's stock. All other holders of the existing notes (other than Valley), who collectively own approximately $249.3 million of the existing notes, would be offered an aggregate of $146.2 million of the new notes and approximately 4.9% of Knology's stock. The existing notes held by Valley would be canceled, contingent upon a successful restructuring.

Knology also said that certain existing Knology stockholders would (subject to completion of the restructuring), contribute approximately $39 million in cash in exchange for shares of Series C preferred stock of Knology representing approximately 7.8% of the outstanding post-restructuring common shares on an as-converted basis. It further said that all existing common and preferred stock of Knology would remain outstanding and would represent approximately 72.9% of the outstanding post-restructuring common shares, on an as-converted basis. Knology's certificate of incorporation would be amended to authorize the new preferred stock to be issued as part of the restructuring plan and to modify the terms of the existing preferred stock in certain respects. Additionally, Knology's senior secured lenders, Wachovia and CoBank, agreed to modify their existing senior secured credit facilities, subject to the completion of the restructuring.

Knology said that each of the terms of the restructuring, as described would be a condition of the overall restructuring and would have to be completed for the restructuring to become effective. In addition, completion of the planned exchange offer for the outstanding notes would be subject to certain conditions, including the exchange of 100% of the outstanding existing notes (other than those held by non-accredited investors), although this minimum tender condition could be waived under certain circumstances. Knology said that it also planned to solicit noteholder votes in favor of a "prepackaged" plan of reorganization under the Bankruptcy Code, noting that this would be an alternative means of effecting the restructuring in the event that the previously described conditions to completion of the exchange offer were not met. Credit Suisse First Boston Corp. acted as exclusive financial advisor to Knology on the restructuring, while Houlihan Lokey Howard & Zukin Capital acted as exclusive financial advisor to the informal noteholders committee.

On July 25, Knology began its previously announced exchange offer for its Knology Broadband 11 7/8% notes, under the previously announced terms. It said the offer would expire at 5 p.m. ET on Aug. 22 (this deadline was subsequently extended). Credit Suisse First Boston (call David Alterman collect at 212 538-0653) is the dealer-manager for the exchange offer, while MacKenzie Partners, Inc. (bankers and brokers call collect at 212 929-5500; all others call toll-free at 800 322-2885) is the information agent.

Doe Run considering restructuring exchange

The Doe Run Resources Corp. (Ca/D) said on Friday (Aug. 23) that it is again extending the expiration time of its previously announced offers to exchange new notes plus a cash accrued interest payment for its outstanding 11¼% series B senior secured notes due 2005, its outstanding 11¼% series B senior notes due 2005 (C/D) and its outstanding series B floating interest rate notes due 2003, its previously announced concurrent cash tender off for those three series of notes and the previously announced related solicitation of noteholder consents to proposed changes in the indentures governing those notes. Those offers were extended to 5 p.m. ET on Sept. 6, subject to possible further extension, from the previous Aug. 23 deadline.

The company said that although Doe Run has received tenders from holders representing 95% of the aggregate outstanding amount of its notes - an amount sufficient to satisfy the minimum tender conditions required for consummation of the offers in their current form - it finds it necessary to attempt to restructure the offers. Doe Run said that continuing market price erosion of Doe Run's primary product, lead metal, has resulted in a decline in the company's available liquidity. Prices have failed to recover to the extent forecast by Doe Run in the original June 6 official offering memorandum setting forth the offers, and in subsequent company documents. Doe Run and its corporate parent therefore believe that consummating the offers in their current form will not provide adequate liquidity to Doe Run, and they are discussing a restructuring of the offers with Doe Run's U.S. working capital lenders and bondholders.

AS PREVIOUSLY ANNOUNCED: On April 15, The Doe Run Resources Corp, a St. Louis-based metals smelting company, announced that it had reached an agreement in principle with its corporate parent, New York-based industrial conglomerate The Renco Group, Inc. and with Regiment Capital Advisors, LLC, under which Renco and Regiment would provide Doe Run with significant capital that would enable Doe Run to restructure its existing debt. Under that agreement in principle, Renco said it would purchase $20 million of Doe Run preferred stock and Regiment - already a significant holder of Doe Run's 11¼% senior and senior secured notes and its floating interest rate notes - said it would commit to lend Doe Run $35 million, and would offer other holders of Doe Run notes the opportunity to participate in making such loan. Doe Run said it planned to make a cash tender offer for a portion of its notes, and an exchange offer for the balance of the notes. The $55 million in proceeds of the Renco investment and the Regiment loan would be used to finance the cash tender offer, to pay the accrued interest as of March 15 on the notes that would be exchanged in the exchange offer, and to pay certain costs of those transactions. Doe Run said that if they were successful, the cash tender offer and the exchange offer would significantly reduce its outstanding debt. Doe Run would meanwhile be able to continue to operate all its facilities at present levels and Doe Run's trade creditors would not be adversely affected.

Besides the $20 million investment, Renco would also provide Doe Run with credit support of up to $10 million, if necessary, to provide additional working capital. Doe Run said the non-binding agreement in principle would be subject to agreement on the terms of definitive documentation and further said that the successful completion of the planned transactions would be subject to several conditions, including, among others, the participation by holders of 90% of the principal amount of each class of notes in the cash tender offer and/or the exchange offer (Doe Run originally issued $200 million of the 11¼% senior notes, $50 million of the 11¼% senior secured notes and $55 million of the floating rate notes). It would also be conditioned upon the satisfactory modification of Doe Run's U.S. and Peruvian revolving credit facilities. Doe Run said it anticipates the completion of definitive documentation for the Regiment loan and the Renco investment within 30 days of its press release, at which time more detailed terms would be announced and the cash tender offer and exchange offer would be commenced.

On May 16, Doe Run outlined the terms of the agreement in principal and announced its tender offer and exchange offer for the notes in an 8-K filing with the Securities and Exchange Commission. The company did not initially disclose expiration deadlines for either offer nor did it disclose deadlines for the related consent solicitations. Doe Run said that under the terms of its exchange offer, it would offer the holders of its outstanding 11¼% senior secured notes $770 per $1,000 principal amount of the notes in new Doe Run 11¼% exchange notes due 2007, plus a cash payment of $56.25 per $1,000 principal amount equal to the amount of accrued and unpaid interest through March 15. It would offer the holders of its existing 11¼% senior notes $670 per $1,000 principal amount of the notes in new exchange notes, plus the $56.25 per $1,000 principal amount interest payment, and it would offer the holders of the existing floating-rate notes $670 per $1,000 principal amount of the notes in new exchange notes, plus an accrued interest payment of $46.90 per $1,000 principal amount. Doe Run said the exchange offer would be open only to those holders who could reasonably be defined as Accredited Investors under Rule 501(a) of the Securities Act of 1933. Doe Run said that simultaneously with the exchange offer, it would begin a cash tender offer for the outstanding notes, under which it would offer to buy the notes at a price between $250 and $350 per $1,000 principal amount. Doe Run said that it would select as the cash payment the highest price specified by any noteholder that would enable the company to purchase the maximum amount of notes while not exceeding its target aggregate purchase price of $44 million. Doe Run said it would pay the same cash payment for all of the notes validly tendered at or below that cash payment price and not subsequently withdrawn, upon the closing of the transaction. It said that holders whose notes were accepted for purchase under the cash tender offer would not be eligible to receive any interest payment on them above the cash payment price. Any holder tendering notes under the cash tender offer would also be considered to have tendered them under the exchange offer as well. Should the amount of notes tendered under the cash tender offer and not subsequently withdrawn exceed the amount that the company would be able to buy and still stay within its available cash aggregate purchase price of $44 million, Doe Run would first accept for payment all notes tendered below that cash payment price and would then accept notes tendered at the cash payment price on a pro-rata basis. Any notes thus tendered under the cash tender offer which could not be purchased for cash would then be exchanged for the appropriate amount of new exchange notes and the appropriate cash interest payment. Doe Run said that should a holder choose to neither tender his existing notes under the exchange offer nor the cash tender offer, it reserves the right to leave such unexchanged or unpurchased notes outstanding upon the conclusion of its offers; it also, however, reserves the right (but is under no obligation) to subsequently purchase such notes as permitted under the terms of its new senior credit facility either on the open market or in negotiated transactions, either for similar or for different consideration as it is offering under the exchange offer and the cash tender offer. It also reserves the right to defease the remaining outstanding notes or to redeem them under the terms of their indentures. Any remaining outstanding notes will be subject to indenture changes for which Doe Run is seeking noteholder consent concurrently with its exchange and cash tender offers. Doe Run said the tender of notes under either the exchange offer or the cash tender offer would be considered to constitute noteholder consent to the proposed indenture amendments, which would eliminate substantially all of the restrictive operating and financial covenants in the indentures, and which would modify a number of the "event of default" provisions, and various other provisions currently contained in the existing notes' indentures.

Doe Run also said that in connection with the offers, it would enter into a new $37.5 million, four-year senior secured credit facility with Regiment Capital Advisors, and that it would offer noteholders who initially elect to participate in the exchange offer the opportunity to participate as co-lenders under the New Senior Credit Facility on a pro-rata basis, based upon those noteholders' respective interests in the existing notes initially tendered in the exchange offer. The participation of the noteholders as co-lenders will be subject to Regiment's right, in its sole and absolute discretion, to lend at least 60% of the aggregate principal amount of the Initial Senior Loan. Each noteholder who elects to participate in the Initial Senior Loan will also participate as a co-lender in any subsequent senior loan approved by Doe Run's existing lenders on a pro- rata basis, in accordance with such noteholder's percentage interest in the Initial Senior Loan. The proceeds of the Initial Senior Loan will be used to consummate the exchange offer and the cash tender offer. Noteholders choosing to participate in the Initial Senior Loan will receive warrants exercisable for up to 20% of the fully diluted common stock of Doe Run, at an initial total exercise price of $2,000,000. The warrants would be distributed to the participating noteholders on a pro-rata basis in accordance with such participant's interest in the Initial Senior Loan. Doe Run said that consummation of the cash tender offer and the exchange offer, as well as related transactions, would be conditioned upon a number of conditions including - but not limited to - the valid tender (without subsequent withdrawal) of at least $125 million total principal amount of the existing notes under the cash tender offer; the participation by 90% of the outstanding principal amount of each of the three series of existing notes in the exchange offer and/or the cash tender offer; and the receipt of the requisite consents to the proposed indenture changes. Doe Run said it expected to launch the tender offer and exchange offer by the last week of May, and warned that there could be no assurance that it would be able to successfully complete the transactions described.

On June 6, Doe Run said in an SEC filing that it had begun an offer to exchange new notes plus a cash accrued interest payment for its outstanding 11¼% senior and senior secured notes due 2005, and its outstanding floating interest rate notes due 2003; had begun a concurrent cash tender off for those three series of notes; and had begun a related solicitation of noteholder consents to proposed changes in the indentures governing those notes. Doe Run said it was also offering noteholders choosing to participate in the exchange offer the option of also participating in its new senior credit facility as co-lenders. It outlined terms of the offers that were the same as those which Doe Run had already outlined in a previous SEC filing. In its latest filing, the company also said that the exchange offer, the cash tender offer and the right of participation in the senior loan would each expire at 5 p.m. ET on July 9, subject to possible extension. Tendered notes could be withdrawn at any time prior to the expiration date.

On July 9, Doe Run extended the pending exchange offer, the cash tender offer and the consent solicitation to 5 p.m. ET on July 19, and said that it was providing updated projected financial information. The company further reported that it had been engaged in "constructive discussions" with holders of a "significant amount" of its notes, and said it was extending the expiration time of the offers and providing the updated projected financial information "as an aid to further discussion of the Offers."

On July 19, Doe Run said that it had further extended its exchange offer for its 11¼% senior and senior secured notes due 2005 and its Series B floating interest rate notes due 2003, its concurrent cash tender off for those three series of notes and solicitation of noteholder consents to 5 p.m. ET on Aug. 2, subject to possible further extension, from the previous July 19 deadline. The company also amended the terms of the aforementioned offers to - among other things - allow its noteholders the ability to elect to participate in a third offer, "the Exchange/Loan Offer," in addition to participating in the previously described cash tender offer or exchange offer. It said that holders who participate in this "Exchange/Loan Offer" will be able to exchange their notes for a participation interest in the Initial Senior Loan which the company, as previously announced, is entering into as part of its overall recapitalization. Doe Run said that it was extending the expiration time of the offers to allow noteholders to consider participating in such an additional offer. Doe Run also said it was amending the terms of the exchange notes which noteholders could elect to receive as part of either the exchange offer or the newly announced "Exchange/Loan Offer" to include, among other things, the provision of a required 1% per annum cash interest payment on each of the first two interest payment dates (as opposed to the previously outlined provision contained in the "Description of Exchange Notes" found in the official Offering Memorandum, which indicated that such interest payments could be paid in full "in kind" (i.e., through the issuance of additional notes, with no cash component). Doe Run further announced that in addition to the inclusion of the new "Exchange/Loan Offer," it has amended the previously outlined terms of its "New Senior Credit Facility" (including the "Subsequent Senior Loan Participation") and its exchange notes to be issued to holders of its current notes successfully participating in the exchange offer. Doe Run said that as amended, the New Senior Credit Facility will consist of the "Initial Senior Loan" in the amount of $35.7 million and a Subsequent Senior Loan in the amount of $25 million, $10 million of which will be committed by Regiment Capital Advisors, LLC at closing to provide Doe Run with additional working capital under certain circumstances in the future. The balance of the Subsequent Senior Loan is to be funded at the request of Doe Run subject to the consent of the lenders. The Renco Group, Inc., ultimate parent of Doe Run, has agreed to take a participation interest in $5 million of the aforementioned $10 million "Regiment Credit Support." Holders of Doe Run's currently outstanding notes who participate in the Initial Senior Loan will have the option - but not the obligation - to participate in the Subsequent Senior Loan. Noteholders who have already tendered their notes into the cash tender offer or the exchange offer will have the right to withdraw or amend such tenders; noteholders who wish to tender their notes into the new "Exchange/Loan Offer" must transmit a completed Letter of Transmittal for such offer to the depositary and exchange agent for the offers.

On Aug. 2, Doe Run said that it had extended the exchange offer, the concurrent cash tender offer and the related consent solicitation to 5 p.m. ET on Aug. 6 from the previous Aug. 2 deadline. Doe Run also said that it has received "overwhelming support" for the offers from holders of all three categories of notes. Doe Run said that although, to the best of its knowledge, holders of approximately 95% of Doe Run's aggregate principal amount of notes outstanding had chosen to participate in the offers, as of the old deadline, approximately 86% of the floating rate notes had been tendered for participation in the offers, still less than the 90% minimum tender required for consummation of the offers; therefore, the company said it was extending the expiration time of the offers in order to continue discussions with John Hancock Funds, Triton Partners LLC and Hawkeye Capital, LP concerning the participation by those entities with respect to the floating-rate notes which those companies hold. Doe Run cautioned that there could be "no assurance that [it] will be able to consummate the Offers successfully."

On Aug. 7, Doe Run said that it had extended its exchange offer, the concurrent cash tender offer and the related consent solicitation to 5 p.m. ET on Aug. 14 from the previous Aug. 6 deadline. Doe Run also said that it was amending the minimum tender condition with respect to the 2003 floating-rate notes, reducing it to 86% from 90% previously. The minimum tender conditions for the other two series of notes - which had previously been achieved - remains 90%. With the amendment regarding the floating-rate notes, Doe Run said the minimum tender required for the consummation of the offers had now been achieved.

On Aug. 14, Doe Run said that it was again extending its offers to 5 p.m. ET on Aug. 20, subject to possible further extension, from the previous Aug. 14 deadline. The company said that although it had already received tenders of notes sufficient to satisfy the previously announced minimum tender conditions required for the consummation of the offers, with holders of 95% of the aggregate principal amount of its outstanding notes having participated, it was nonetheless extending the offers to allow it to continue discussions with its working capital lenders regarding the terms of its Amended and Restated U.S. Revolving Credit Facility. On Aug. 21, Doe Run again extended the expiration of the offers to 5 p.m. ET on Aug. 23, subject to possible further extension, from the previous Aug. 20 deadline. The company said that it had reached a tentative agreement on its proposed restructuring with its working capital lenders, and had extended the offers to allow it to finalize the terms of its Amended and Restated U.S. Revolving Credit Facility and to complete the required definitive documentation. State Street Bank and Trust Co. in Boston (call 617 662-1548 or fax documents to 617 662-1452) is the exchange agent and the depositary for the offers. MacKenzie Partners, Inc. (call 212 929-5500 or, toll-free, 800 322-2885) is the information agent.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.