CNG discloses consent fee for 12¼% notes, reasoning for solicitation

By Angela McDaniels

Tacoma, Wash., May 11 - CNG Holdings, Inc. will pay a fee of $7.50 per $1,000 principal amount to holders of its $200 million 12¼% senior secured notes due 2015 who consent to proposed changes to the notes, according to a notice to bondholders.

The company announced the consent solicitation for the notes in a news release on May 10.

CNG is seeking consents to the proposed termination of the registration rights agreement relating to the notes and any amendments to the note indenture that CNG determines to be necessary or appropriate to memorialize such termination.

In the bondholder notice, the company said it has completed the planning and budgeting necessary to meet the timelines and requirements of the registration rights agreement. However, it estimates that the annual incremental cost of registering the notes will be approximately $500,000 and that additional one-time costs for assistance with internal control documentation in connection with the registration could range from $500,000 to $750,000.

In addition, CNG said it understands that the notes are trading well in the secondary market without registration.

The consent solicitation will expire at 8 p.m. ET on May 24.

Consents are needed from the holders of at least a majority of the outstanding notes. If the consent solicitation is not successful, the consent fee will not be paid.

D.F. King & Co., Inc. (212 269-5550) is the information agent.

The Cincinnati-based company provides international alternative financial services, including payday loans, installment loans, check cashing, foreign currency exchange, money orders, money transfers and auto title loans.

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