XM Satellite Radio begins exchange offer for 14% '10 notes

XM Satellite Radio Holdings Inc. said on Tuesday (Dec. 24) that it was beginning a an exchange offer and consent solicitation under which the company would seek to exchange a package of new notes, cash and common stock warrants for at least 90% of its $325 million of outstanding 14% senior secured notes due March 15, 2010.

The exchange offer will expire at 12 midnight ET on Jan. 23, subject to possible extension.

XM is offering up to $474.2 million (aggregate principal amount; $325 million accreted value) of its new 14% senior secured discount notes due Dec. 31, 2009, plus up to $22.75 million in cash and warrants to purchase up to 27.625 million shares of XM's Class A common stock at $3.18 per share.

On an individual basis, the consideration per $1,000 principal amount of existing notes tendered breaks down to a package consisting of $1,459 principal amount at maturity ($1,000 accreted value as of March 15, 2003) of XM's new 14% senior secured discount notes due Dec. 31, 2009, plus $70 in cash, and a warrant to purchase 85 shares of XM's Class A common stock at $3.18 per share.

The new notes will accrete interest until Dec. 31, 2005, after which time XM will make semi-annual cash interest payments beginning on June 30, 2006. The new notes will be secured by substantially all of the company's assets (excluding real property), in contrast to the security for the existing notes, which is limited to the capital stock of XM's FCC license subsidiary.

XM also said that it would solicit consents to amend the existing notes' indenture to, among other things, eliminate or substantially amend all of the restrictive covenants, other than covenants requiring payment of interest on the notes and principal, when due. Noteholders may not deliver consents without tendering existing notes in the exchange offer.

The company said that financing transactions concurrently announced with the exchange offer would be contingent upon, among other things, 90% participation by existing noteholders in the exchange offer, although XM reserves the right to waive that requirement with the consent of General Motors Corp. and 66 2/3% of the investors in the financing transaction.

Bank of New York is the depositary for the tender offer. D.F. King Inc. Is the information agent.

AS PREVIOUSLY ANNOUNCED, XM Satellite Radio, a Washington D.C. satellite radio broadcaster, said on Monday (Dec. 23) that it had agreed to enter in to financing transactions totaling $450 million aimed at improving its liquidity. These would include a $200 million equity investment by a group on investors and $250 million of payment arrangements and credit facilities with General Motors. XM also said at that time that it planned to exchange the new notes, cash and warrants for up to 90% of the existing 14% notes, but gave no further details of the proposed exchange offer at that time.

Comdisco Holding redeems some more 11% '05 notes

Comdisco Holding Co. Inc. said on Monday (Dec. 23) that it had completed the previously announced partial redemption of $200 million of its 11% subordinated secured notes due 2005 (out of a total previously outstanding amount of $585 million). The notes were redeemed at par plus accrued and unpaid interest from Aug. 12 to the Dec. 23 redemption date.

Comdisco also announced that it will make optional further partial redemption of $100 million principal amount of the 11% notes, out of the currently outstanding $385 million. It will redeem the notes at par plus accrued and unpaid interest up to the redemption date of Jan. 9.

Wells Fargo Bank will serve as the paying agent for this redemption. A notice of the redemption containing information required by the terms of the indenture governing the subordinated secured notes will be mailed to the noteholders.

AS PREVIOUSLY ANNOUNCED, Rosemont, Ill.-based Comdisco, which formerly provided equipment leasing and technology services to business customers, emerged following its Chapter 11 bankruptcy reorganization as a holding company whose purpose is to sell, collect or otherwise reduce to money the remaining assets of the corporation.

It said on Oct. 9 that it would redeem the entire $400 million outstanding principal amount of its variable-rate senior secured notes due 2004 on or about Oct. 21, at par plus accrued and unpaid interest from Aug. 12 to the redemption date. Comdisco said that Wells Fargo Bank would serve as the paying agent for the planned note redemption.

On Oct. 23, Comdisco said that the redemption of all $400 million of the variable rate senior notes had taken place as scheduled on Oct. 21.

Comdisco also said that following the redemption of those notes, it would make cash interest payments on the 11% notes. It explained that terms of the 11% subordinated notes provided for the interest to be paid-in-kind through the issuance of additional 11% subordinated notes while the senior notes were outstanding. The initial interest payment date for the subordinated notes is Dec. 31 and the cash interest payment will be made on such date to registered holders of record (as of the close of business on Dec. 15) of the 11% notes.

On Oct. 29, Comdisco said that it would make a partial redemption of $65 million of the outstanding principal amount of the 11% notes (out of the $650 million which were outstanding at that time), under its mandatory redemption obligations. Comdisco said the notes would be redeemed at par plus accrued and unpaid interest from Aug. 12 to the redemption date. It anticipated that the partial redemption of the notes would occur on Nov. 14, and that Wells Fargo Bank would serve as the paying agent for this redemption.

On Nov. 15, Comdisco said that it had redeemed the $65 million of 11% notes on Nov. 14, as previously announced.

Comdisco said on Dec. 9 that it would make a redemption of another $200 million of the 11% notes (out of the then- current total outstanding amount of $585 million). It said that the notes would be redeemed at par plus accrued and unpaid interest from Aug. 12 to the redemption date. The company anticipated that the partial redemption of the notes would occur on Monday ( Dec. 23), with Wells Fargo Bank serving as the paying agent for this redemption.

Allbritton Communications gets consents in 9¾% '07 debenture tender offer

Allbritton Communications Co. (B3/B-) said on Friday (Dec. 20) that it had received had received the requisite amount of tenders and consents required to eliminate or modify substantially all the covenants, certain events of default and related provisions in the indenture governing its outstanding 9¾% senior subordinated debentures due 2007, as part of its previously announced tender offer and related consent solicitation for the notes.

As of the now expired consent deadline, holders of approximately 93% of the $275 million outstanding aggregate principal amount of the debentures had consented to the proposed indenture amendments and had tendered their securities.

Accordingly, Allbritton and the debentures' indenture trustee have executed and delivered a supplemental indenture incorporating the amendments approved by the debtholders; however, the amendments will not become operative unless the tendered debentures are accepted for purchase in accordance with the terms of the tender offer. If the amendments do become operative, they will be binding upon holders of all untendered 9¾% debentures.

Deutsche Bank Securities Inc. (call 646 324-2180) is the dealer manager for the tender offer and the consent solicitation. MacKenzie Partners, Inc. (call 212 929-5500 or 800 322-2885) is the information agent.

AS PREVIOUSLY ANNOUNCED: Allbritton, a Washington D.C.-based television station group owner, said on Dec. 6 that it was launching a tender offer for all its outstanding 9¾% senior subordinated debentures due 2007. Allbritton is also soliciting consents to proposed indenture amendments aimed at eliminating substantially all of the restrictive covenants and certain events of default from the indenture.

Allbritton said the tender offer would expire at 12:01 a.m. ET on Jan. 7, subject to possible extension. Holders would have to tender their debentures to the company - thus giving their consent to the desired indenture changes - by the (now expired) consent payment deadline of 5 p.m. ET on Friday (Dec. 20) in order to be eligible to receive a consent payment as part of their total consideration.

The company said that holders tendering their debentures would be required to also consent to the proposed amendments, and holders consenting to the proposed amendments would also be required to tender their debentures.

Holders validly tendering their debentures and delivering consents by the consent payment deadline would receive total consideration of $1,039 per $1,000 principal amount of debentures tendered. The total consideration includes a consent payment of $5 per $1,000 principal amount for eligible holders.

Holders validly tendering their notes after the consent payment deadline would only receive tender consideration of $1,034 per $1,000 principal amount of debentures and would not receive the consent payment.

Allbritton said that it intends to fund the tender offer, and all related costs and expenses, with the net proceeds of an offering of new 7¾% senior subordinated notes due 2012 (high yield market syndicate sources heard on Dec. 6 that Allbritton had sold $275 million of the new notes at par), as well as additional borrowings under the company's credit facility and/or cash on hand.

The company said the tender offer would be conditioned upon Allbritton completing arrangements for financing the purchase of the debentures, and other general conditions.

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