Verso Paper units offer to issue 9¾% notes in exchange for floaters

By Susanna Moon

Chicago, March 29 - Verso Paper Corp. said that two of its wholly owned subsidiaries, Verso Paper Holdings LLC and Verso Paper Inc., began an offer to issue up to $180.2 million principal amount of new 9¾% secured notes due 2019 in exchange for their outstanding $180,216,000 principal amount of senior secured floating-rate notes due 2014.

The issuers also began a solicitation of consents for waivers and proposed amendments to the floaters and, separately, to authorize release from the liens and security interests in the collateral securing the notes, according to a Verso press release.

Holders who tender their notes in the exchange offer will be deemed to have given their consents to both the proposed amendments and the collateral release for the tendered notes.

The company will pay par for each $1,000 principal amount of notes tendered by the early tender deadline at 5 p.m. ET on April 10. The total purchase price includes an early tender premium of $50 per $1,000 of notes.

The offer will end at 11:59 p.m. ET on April 24. Tendered notes may be withdrawn by the early tender date.

Holders who tender their notes after the early date will receive the base payment of $950 per $1,000 of notes.

The exchange offer and consent solicitation are conditioned on the tenders and consents by holders of more than half of the floaters.

The issuers said they plan to enter into a supplemental indenture amending the notes promptly after receiving the required consents for the proposed amendments. To the extent the consents for the collateral release have also been received, the supplemental indenture will also include the collateral release.

Global Bondholder Services Corp. (866 470-3700 or for brokers and banks 212 430-3774) is the information agent for the exchange offer.

Verso is a Memphis, Tenn.-based producer of coated papers.

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