Freedom Mortgage posts early exchange results; consents received

Chicago, July 12 – Freedom Mortgage Corp. announced the early tender results relating to exchange offers for two series of notes, according to a press release.

Noteholders have been asked to exchange their existing notes for new notes with the same coupons and the same maturity dates on a one-to-one basis, but pursuant to new indentures.

As of the early deadline, holders tendered for exchange:

• $501,329,000, or 98.39%, of the $509,525,000 outstanding 7 5/8% senior notes due May 1, 2026 (Cusips: 35640YAF4, U31333AD6); and

• $535,081,000, or 99.04%, of the $540,246,000 outstanding 6 5/8% senior notes due Jan. 15, 2027 (Cusips: 35640YAG2, U31333AE4).

The equal amount of old notes-to-new notes considerations include $50 principal amount of new notes for each $1,000 of notes as early tender premiums. The full exchange offer is available, as an amendment to the offer, through the final deadline. Initially, the full amount was not payable to noteholders who tendered their notes for exchange after the early deadline.

Consents

The company announced that it received the requisite consents in its consent solicitations for the notes, as exchanging noteholders were deemed to deliver consent in the related consent solicitations.

As exchange considerations, in addition to the like amount of notes, early tendering noteholders will receive a $20 cash consideration as a consent payment for each $1,000 note. Noteholders who tender their notes after the early deadline are not eligible for the consent payment.

Noteholders could not deliver consent without exchanging their notes.

The consent solicitation eliminates certain of the covenants, restrictive provisions, events of default and the requirement for subsidiaries to provide guarantees in the future from the existing senior notes indentures.

A majority of noteholders had to consent for each series.

Freedom Mortgage and the trustees under the existing senior notes indentures entered into supplemental indentures.

Each supplemental indenture became effective upon execution, and the proposed amendments shall become operative upon the consummation of the applicable exchange offer on the settlement date.

Reorganization

Freedom Mortgage will be reorganizing its corporate structure, transferring all equity interest to Freedom Mortgage Holdings LLC.

After giving effect to the reorganization, neither Freedom Mortgage Parent LLC nor Freedom Mortgage Holdings LLC will have any operations or assets independent of their ownership of their subsidiaries.

The new notes will be initially issued by Freedom Mortgage Corp. but will transition to Freedom Mortgage Holdings LLC.

Details

The exchange offers and consent solicitation are conditional upon one another.

Conditionally, holders of at least 65% of the aggregate principal amount over both series must participate.

The early tender time was 5 p.m. ET on July 11.

The expiration time is 5 p.m. ET on July 26.

Settlement is expected within three days of the expiration time.

The offer is open to Rule 144A investors and persons who qualify under Rule 902. There is an eligibility form that needs filling out (www.dfking.com/freedommortgage).

D.F. King & Co., Inc. is the information and exchange agent for the offer (888 628-1041, 212 269-5550, freedommortgage@dfking.com).

Freedom Mortgage is a Mount Laurel, N.J.-based mortgage lender.

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