UbiquiTel completes exchange offer for 14% '10

UbiquiTel Operating Co. said on Monday (Feb. 24) that it had successfully completed its previously announced offer to exchange new debt for up to $225 million of its outstanding 14% senior subordinated discount notes due 2010.

The offer expired as scheduled at 5 p.m. ET on Friday (Feb. 21), without extension; as of that deadline, approximately $189.4 million aggregate principal amount of the 14% notes ($142.1 million aggregate accreted value), or approximately 84% of the outstanding principal amount, had been validly tendered and accepted for exchange by the company. Accordingly, UbiquiTel will issue approximately $47.4 million aggregate principal amount of new notes ($35.5 million aggregate accreted value) and make an aggregate cash payment of approximately $9.5 million to tendering holders.

In addition, the company will issue new series B notes due 2008 totaling approximately $12.6 million aggregate principal amount ($9.5 million aggregate accreted value) and warrants to purchase approximately 9.5 million shares of common stock of the company's parent UbiquiTel Inc. in order to fund the cash portion of the offer.

Upon consummation of the offer and a related amendment of its credit facility, the company's overall debt will be reduced by approximately $144.5 million aggregate principal amount ($112.1 million aggregate accreted value).

UbiquiTel said completion of the offer would allow it to reduce its cash interest requirements by approximately $9.5 million in 2005 and approximately $19 million annually beginning in 2006.

Banc of America Securities was the exclusive dealer manager for the offer.

AS PREVIOUSLY ANNOUNCED: UbiquiTel - a wholly-owned subsidiary of UbiquiTel Inc., a Conshohocken, Pa.-based Sprint PCS affiliate - said on Jan. 23 that it planned to offer up to $56.25 million aggregate principal amount of new 14% senior discount notes due 2010 in exchange for up to $225 million of the outstanding 14% notes.

It said the exchange offer would expire at 5 p.m. ET on Feb. 21, subject to possible extension, with an initially announced early tender deadline of 5 p.m. ET on Feb. 5 (on Feb 14, the company said that it would waive the early tender deadline).

The company offered to issue $250 in principal amount of the new notes per $1,000 principal amount of the existing notes validly tendered and accepted, up to a maximum of $225 million principal amount of the existing notes. It said that if more than $225 million of the existing notes were to be validly tendered prior to the expiration date, the company would accept tenders from its noteholders on a pro- rata basis.

In addition to offering the new notes for the existing securities, UbiqiTel initially offered to pay $50 in cash per $1,000 principal amount of existing notes validly tendered prior to early tender deadline and accepted for purchase by the company, but subsequently waived that condition, making all tendering noteholders eligible for the additional payment.

UbiquiTel said the offer is only being made inside the U.S. to investors who could be considered "qualified institutional buyers" or "accredited investors," or to "non-U.S. persons," as defined by the Securities Act of 1933.

The company said that the new notes to be issued in the offer would ill be senior unsecured obligations of the company, guaranteed on a senior unsecured basis by UbiquiTel Inc. and all of the company's existing and future restricted subsidiaries and would rank senior to the existing notes remaining outstanding after consummation of the offer.

It said the offer would be subject to the receipt of requisite consents from the lenders under the company's senior secured credit facility; completion of a new financing on terms acceptable to the company to fund the cash portion of the offer; and certain other general conditions.

UbiquiTel said that it had already reached an agreement in principle with its credit facility lenders for their consent to the offer. The lenders are conditioning their consent on the company being able to finance the entire cash portion of the offer through a new financing.

Penn National seeks consent from Shreveport 13% '06 noteholders

Penn National Gaming, Inc. said Monday (Feb. 24) that one of its wholly owned subsidiaries is soliciting consents to proposed waivers with respect to the notes from the holders of record (as of Friday, Feb. 21) of the 13% senior secured notes due 2006 and the 13% first mortgage notes due 2006 issued by Hollywood Casino Shreveport and Shreveport Capital Corp.

Penn National, a Wyomissing, Pa.-based casino operator, is seeking the waivers in connection to its proposed merger transaction with Hollywood Casino Corp. The principal purpose of the proposed waivers is to eliminate the risk of a default under the indentures governing the notes that may occur as a result of the planned merger.

The proposed waivers will provide Penn National Gaming with an opportunity to evaluate the Shreveport Casino with a view towards rationalizing its operations and capital structure without the distractions and disruption associated with a default under the indentures. A default would occur in the event that the issuers of the notes or any other party fails to make or consummate an offer to purchase the notes at 101% of their principal amount following the merger, as is required under the indentures and the notes due to the change of control resulting from the merger.

Penn National said that it does not intend to make a change of control offer to repurchase the notes, nor will it permit any of its subsidiaries to do so or provide financing or credit support to enable any of them, or Hollywood Casino, to do so.

No consideration is being paid to any noteholder in connection with the consent solicitation.

The consent solicitation will expire at 5 p.m. ET on Feb. 28, subject to possible extension. The proposed waivers will be approved and will become effective at the time - on or prior to the expiration deadline - that Penn National has received consents from the holders of at least a majority of the senior secured notes and a majority of the first mortgage notes.

The proposed waiver for the senior secured notes and the proposed waiver for the first mortgage notes are conditioned upon each other, and, accordingly, the requisite consents must be received for each series of notes for each of the proposed waivers to become effective.

Completion of the Penn National-Hollywood Casino merger is subject to certain conditions, including certain regulatory approvals. Approval of the proposed waivers is not a condition to consummation of the merger.

The consent solicitation is subject to the terms and conditions set forth in the official Consent Solicitation Statement and the related Consent Letter that are being sent to all holders of the notes. D.F. King & Co., Inc. is serving as the information agent and tabulation agent in connection with the solicitation of consents.

ONO completes cancellation of portion of junk debt

ONO said on Monday (Feb. 24) that it had completed the cancellation of a "significant" portion of its outstanding dollar- and euro-denominated high-yield debt. It said that the transaction - which resulted in the cancellation of approximately €503 million of bonds - was closed on Feb. 13 with the signing of the documentation that permitted the bonds to be cancelled.

ONO, one of Spain's leading providers of broadband telecommunications services, said that the process began with the purchase by Grupo Corporativo ONO of approximately €155 million of bonds issued by ONO Finance in the open market between May and October, 2002. A further approximately €378 million of bonds were purchased in a formal tender offer which was launched on Nov. 20 and which closed on Dec. 19.

The company said that out of the total of approximately €533 million of bonds that were purchased by Grupo Corporativo ONO €503 million have been cancelled, out of the €949.644 million of outstanding notes. A total of €30 million of the euro-denominated 14% notes due 2011 has been retained by GCO.

ONO cancelled $182.902 million face amount of its $275 million face amount of dollar-denominated 13% notes due 2009. It cancelled $116.486 million of its $200 million of dollar-denominated 14% notes due 2011.

It cancelled €79.372 million of its €125 million of euro-denominated 13% notes due 2009, €86.298 million of its €200 million of euro-denominated 14% notes due 2010 and €37.947 million of its €150 million of euro-denominated 14% notes due 2011.

ONO said that approval for a number of changes to the structure of its syndicated loan was provided by Dec. 10. Those changes have now been ratified and all of the documentation necessary for the bonds to be cancelled has been signed and closed.

Lexington Precision extends exchange offer for 12¾% notes

Lexington Precision Corp. said on Monday (Feb. 24) that it had again extended its previously announced offer to exchange new debt, plus stock-purchase warrants and a participation payment, for its outstanding 12¾% senior subordinated notes which came due in 2000 but which were not redeemed at that time. The offer was extended to midnight ET on Feb. 28, subject to possible further extension, from the previous Feb. 24 deadline.

Lexington said that as of Feb. 24, holders had tendered $27,209,125 of the notes, or 99.3% of the outstanding amount, unchanged from the amount announced on Oct. 31 and in a number of subsequent expiration deadline extension announcements. While that has satisfied the 99% minimum tender condition to the exchange offer, the company said that a number of other conditions have not yet been satisfied, including the completion of a new senior secured credit facility on terms satisfactory to the company.

AS PREVIOUSLY ANNOUNCED Lexington Precision, a New York-based manufacturer of rubber and metal components for the automobile and medical devices industries, said on July 10 that it had begun an exchange offer for its $27.412 million of outstanding 12¾% notes. Under the terms of the exchange, which is open only to holders of record (as of July 1) of the existing notes, the company would give them a principal amount of new 11½% senior subordinated notes due 2007 equal to the sum of the principal amount of the outstanding 12¾% notes, plus the accrued interest on those notes from Aug. 1 1999, through April 30, 2002. The company said that accrued interest would total $350.625 per $1,000 principal amount of the existing notes. It said that if all of the outstanding existing notes were to be tendered and the exchange offer completed, Lexington Precision would issue new 11½% notes to cover a total of $9.611 million of accrued interest from the existing notes.

Lexington Precision initially said that the exchange offer would expire at midnight ET on Aug. 7, although this deadline was subsequently extended multiple times. It said that interest on the new 11½% notes would accrue from May 1, 2002; interest for the three-month period ended July 31 would be paid on the issue date of the 11½% notes, and after that, would be payable quarterly on each November 1, February 1, May 1, and August 1. The company said that holders of the new 11½% notes would also receive a participation fee equal to $22.20 per $1,000 principal amount of 11½% notes issued, payable in three equal installments on Sept. 30, 2002, Dec. 31, 2002 and March 31, 2003. Lexington further said it would also issue to the holders of the new notes warrants to purchase 10 shares of common stock per $1,000 principal amount of notes; the warrants would allow their holders to buy the stock at a price of $3.50 per share at any time during the period from Jan. 1, 2004 through Aug. 1, 2007. Prior to Jan. 1, 2004, the warrants will not be detachable from the 11½% notes and will be transferable only as part of a unit with the notes.

The company said that it was undertaking the exchange offer as part of a larger comprehensive financial restructuring plan that would also involve an extension of the company's 10½% senior notes and 14% junior subordinated notes, and a refinancing of the company's senior, secured credit facilities. It said that completion of the exchange offer would be subject to a number of conditions, including the refinancing of Lexington's other debt on satisfactory terms. Completion of the exchange offer would also be subject to the condition that at least 99% of the outstanding 12¾% notes be tendered for exchange and not withdrawn. The company warned that if the exchange offer were to be completed, it would not pay principal or accrued interest on any untendered 12¾% notes. It further said that the exchange offer reflects an agreement in principle that it reached with the four largest holders of its 12¾% notes, who among them control a total of $20.49 million of the 12¾% notes, or 74.7% of the $27.412 million outstanding.

On Aug. 7, the company extended the expiration of the exchange offer to 12 midnight ET on Aug. 30, and on Aug. 30, it said that it had again extended the offer to midnight ET on Sept. 30 and said that it had received tenders of $27,131,875 of the notes, or 98.98% of the outstanding amount, just shy of the 99% minimum tender condition. On Sept. 30, Lexington announced the further extension of the offer to 12 midnight ET on Oct. 18, and said that it had received tenders of $27,208,875 of the notes, or slightly more than 99% of the outstanding amount, satisfying the minimum tender condition to the consummation of the exchange offer. On Oct. 18, the company announced the further extension of the offer to 12 midnight on Oct. 31, subject to possible further extension, and said that as of Oct. 18, some $27,209,125 of the notes, or slightly more than 99% of the outstanding amount, had been tendered.

A series of similar announcements further extending the offer were subsequently made, most recently on Feb. 18, with the same level of noteholder participation as previously announced.

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