IdleAire delays consent bid for 13% notes, accepts consents for warrants

By Susanna Moon

Chicago, Sept. 14 - IdleAire Technologies Corp. said it extended its consent solicitation for its $320 million 13% senior discount notes due 2012 to 5 p.m. ET on Sept. 14 from 10 a.m. ET on Sept. 13.

The company also said it received the required consents to amend the warrant agreement for the 320,000 warrants issued with the notes. The consent solicitation for the warrants expired at 10 a.m. ET on Sept. 13.

On Aug. 15, the company announced the start of a consent solicitation for the units comprising its $320 million of restricted old and registered new 13% senior secured discount notes due 2012 and 320,000 warrants to purchase common stock.

The units were issued in December 2005, and the old notes and warrants became separable as of June 30, 2006.

The warrants were exercisable into shares representing 30% of IdleAire's common stock on a fully diluted basis.

Under the note indenture, on June 15, 2009, the company is required to issue and deliver to noteholders additional warrants to purchase up to 10% of its outstanding common stock if the consolidated cash flow of IdleAire for the fiscal year ending Dec. 31, 2008 does not equal or exceed $40 million.

IdleAire is soliciting consents to amend the indentures of the notes and warrants to:

• Add a provision requiring the company, upon closing of its initial public offering of common stock, to raise net proceeds of at least $100 million on or before June 30, 2008;

• Issue and deliver to an escrow account 7,204,835 shares of common stock, representing about 5% of the total number of shares of IdleAire's common stock deemed outstanding as of the record date, for beneficial owners of the notes;

• Amend the cash flow provision to provide for the termination of IdleAire's obligation to deliver the contingent warrants if restricted common shares are issued and delivered upon a qualified public offering; and

• Modify the warrant indenture to provide for a 180-day lock-up with respect to the existing warrants and the shares of common stock to be issued upon exercise of the existing warrants following the public offering.

The company is seeking consents from holders of two-thirds of the notes. It needed consents from a majority of the warrant holders.

Upon completion of the public offering, IdleAire will issue restricted common shares and the cash flow provision will become null and void.

The company's offer to issue new notes in exchange for the restricted old notes expired at 5 p.m. ET on Aug. 14.

Jefferies & Co. (203 708-5831) is the information agent. Wells Fargo Bank, NA (612 667-9825) is the tabulation agent.

Based in Knoxville, Tenn., IdleAire is a privately held research and development company that provides products and services for the long-haul trucking freight industry.

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