Denny's tenders for 11¼%, 12¾% notes

New York, Sept. 7 - Denny's Corp. said it has begun cash tender offers for any and all of its $343.9 million principal amount of 11¼% notes due 2007 and $111.7 million principal amount of 12¾% senior notes due 2007. The 12¾% notes were issued jointly with the company's Denny's Holdings Inc. subsidiary.

The Spartanburg, S.C., full-service restaurant operator is also soliciting consents to amend the note indentures to eliminate substantially all of the restrictive covenants and related events of default and reduce the minimum notice period for a redemption to three days from 30.

The tender offers run through midnight ET on Oct. 4 while the consent solicitation expires at 5 p.m. ET on Sept. 20. Tenders cannot be withdrawn after the consent deadline.

Consents are required from holders of a majority of the principal amount of the notes to amend the respective indentures.

For the 11¼% notes, Denny's will pay 103.75% of par plus a consent fee of 0.25% to holders who tender by the consent deadline. Holders who tender after the consent deadline will not receive the consent fee. The company will also pay accrued interest up to but excluding the payment date.

Denny's intends to redeem any notes not tendered at a price of 103.75% of par plus accrued interest, assuming it obtains the necessary financing.

For the 12¾% notes, Denny's will pay 106.375% of par plus a consent fee of 0.25% to holders who tender by the consent deadline. Holders who tender after the consent deadline will not receive the consent fee. The company will also pay accrued interest up to but excluding the payment date.

Denny's intends to redeem any notes not tendered at a price of 106.375% of par plus accrued interest, assuming it obtains the necessary financing.

The tender offers will be financed with a new credit facility, expected to include $345 million of term loans and a $75 million revolving credit facility for working capital and general corporate purposes.

UBS Securities LLC (888 722-9555, ext. 4210 or call collect 203 719-4210) and Goldman, Sachs & Co. (877 686-5059 or call collect 212 357-5680) are dealer managers and solicitation agents. MacKenzie Partners Inc. (800 322-2885 or call collect 212 929-5500) is the information agent. U.S. Bank NA is depositary.

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