EchoStar to retire 9¼% '06 notes

EchoStar Communications Corp. said on Tuesday (Dec. 31) that its EchoStar DBS Corp. subsidiary has elected to retire all of its $375 million of outstanding 9¼% senior notes due 2006, three years early, exercising its optional early redemption right.

The Littleton, Colo.-based satellite television broadcaster said that under the terms of the notes' indenture, the notes will be repurchased effective Feb. 1 at 104.625% of face value (i.e. $1,046.25 per $1,000 principal amount), for a total expenditure of approximately $392 million. Interest will be paid through the Feb. 1, 2003, redemption date.

The trustee for the notes is the U.S. Bank Trust NA.

Iron Mountain gets consents from 9 1/8% '07 noteholders

Iron Mountain Inc. (B2/BB-) said on Tuesday (Dec. 31) that it had received through its depositary and had accepted tenders and consents representing approximately 69% of the $75.2 million aggregate principal amount of its outstanding 9 1/8% senior subordinated notes due 2007, as part of its previously announced tender offer and related consent solicitation for those notes.

Receipt of the tenders and consents by the previously announced consent deadline of 5 p.m. ET on Monday Dec. 30 enabled the company to amend the timing required for effecting a Notice of Redemption and to eliminate or modify certain covenants and related provisions in the Indenture governing the notes.

Iron Mountain and the notes' trustee have executed a supplemental indenture containing the desired indenture amendments, which were to become operative immediately. Iron Mountain said it expected to pay for all notes validly tendered by the consent deadline on Tuesday.

Iron Mountain has engaged Bear, Stearns & Co. Inc. (contact the Global Liability Management Group toll-free at 877 696-2327) to act as the exclusive Dealer Manager and Solicitation Agent in connection with the tender offer and consent solicitation. D.F. King & Co., Inc. (call toll-free at 800 488-8075) is the information agent for the tender offer and consent solicitation.

AS PREVIOUSLY ANNOUNCED: Iron Mountain, a Boston-based records and document storage company, said in its 10-Q quarterly filing with the Securities and Exchange Commission on Nov. 12 that it had completed an offer to exchange new 8 5/8% notes for its outstanding 9 1/8% notes on Nov. 8. The notes were swapped at an exchange ratio of 1.0237, resulting in the issuance of $45.9 million in face value of 8 5/8% notes and the retirement of $44.8 million of the 9 1/8% notes.

The company said the non-cash debt exchange would result in carryover basis and, therefore, no gain or loss on extinguishment of debt.

On Dec. 16 Iron Mountain said that it had begun a cash tender offer and consent solicitation for all $75.19 million principal amount of the 9 1/8% notes which had remained outstanding (following the previously announced debt exchange offer), and was also soliciting noteholder consents to proposed indenture changes that would eliminate certain restrictive covenants and amend the timing required for effecting a Notice of Redemption.

The company said the tender offer would expire at 12 midnight ET on Jan. 14, while the consent solicitation portion of the offer would expire at 5 p.m. ET on Monday (Dec. 30), with both deadlines subject to possible extension. It said that holders tendering their notes would be required to consent to the proposed indenture amendments, and could not deliver consents to the indenture changes without also tendering their notes.

Iron Mountain said that noteholders who validly tender their notes and deliver the related consents by the consent deadline would receive total consideration of $1,045.63 per $1,000 principal amount of notes tendered, including a $30 per $1,000 principal amount consent payment. Iron Mountain said it expected to pay the total consideration promptly after the consent date for notes that are validly tendered on or prior to the consent date and accepted for purchase.

Holders who validly tender their notes after the consent date and prior to the expiration date would not be entitled to the consent payment, and would receive the total consideration minus the consent payment as their consideration. Iron Mountain expects to make payment on those notes that are validly tendered after the consent deadline but before the tender offer expiration deadline and accepted for purchase promptly after the offer expires. All holders who validly tender their notes any time before the expiration would also be paid accrued and unpaid interest up to, but not including, the payment date for the notes.

Iron Mountain said it would finance the tender offer and consent solicitation with a portion of the net proceeds from an offering of $100 million of new senior subordinated notes due 2015 (The company separately announced later in the day on Dec. 16 that it had sold $100 million of 7¾% notes at par to realize total proceeds of $98.4 million after underwriting costs) . It said completion of this financing would be one of the conditions to Iron Mountain's obligations to accept notes for payment.

Arch Wireless redeems $35 million 10% '07 notes

Arch Wireless, Inc. said on Tuesday (Dec. 31) that its wholly owned subsidiary, Arch Wireless Holdings, Inc., had completed the previously announced redemption of $35 million principal amount of the company's 10% senior subordinated secured notes due 2007. The redemption, which had been announced on Nov. 27, took place as scheduled on Dec. 31, with the notes redeemed at par value.

The transaction, the latest in a series, brought the total amount of the 10% notes redeemed since their issuance last May 29, following Arch's emergence from a Chapter 11 reorganization, to $90 million, leaving $110 million of the $200 million of notes originally issued remaining outstanding. Arch did not announce any further redemptions of the notes at this time.

Arch also said that under terms of the 10% notes' indenture, holders of record (as of Dec. 16) received cash distributions in connection with the Dec. 31 redemption. The Bank of New York is the indenture trustee for the 10% notes, which trade in the over-the-counter market with the CUSIP number 039392AA3.

AS PREVIOUSLY ANNOUNCED, Arch Wireless - a Westborough, Mass.-based provider of wireless messaging and mobile information services - said on May 29 that its First Amended Joint Plan of Reorganization, which had been confirmed by the U.S. Bankruptcy Court for the Western Division of Massachusetts on May 15, officially became effective, thus marking the formal emergence from Chapter 11 of Arch and its subsidiaries. As part of that reorganization, Arch Wireless Holdings issued $200 million principal amount of new 10% notes and $100 million principal amount of new 12% subordinated secured compounding notes due 2009, while the parent company issued 20 million shares of new common stock. The new shares and notes were issued in full satisfaction, release, discharge and cancellation of all claims against Arch and its subsidiaries based on transactions or occurrences prior to Dec. 6, 2001. All previously outstanding equity securities, including common stock and preferred stock, and all options and other rights to acquire Arch securities were cancelled.

On July 8, Arch Wireless said that Arch Wireless Holdings had given notice of its intention to redeem $10 million principal amount of its 10% notes. Arch said that it expected to redeem the notes on July 31. It said the redemption transaction would be handled by the notes' trustee, The Bank of New York. Arch said that under terms of the notes' indenture, only holders of record as of July 16 would be entitled to receive cash distributions in connection with the redemption. Arch warned that creditors that had not yet tendered their letters of transmittal to The Bank New York in accordance with Arch's Joint Plan of Reorganization would not receive a cash distribution in connection with the redemption, unless their letter of transmittal were to be received by the exchange agent by July 15. Accordingly, Arch said it "strongly" urged all such creditors to submit their transmittal letters prior to July 15. Arch said that early redemption of that portion of the 10% notes - this in addition to recent exchange transactions undertaken as part of its overall financial reorganization - would further lower the company's interest expense and generate greater financial flexibility.

On July 31, Arch Wireless said that its subsidiary had completed the previously announced redemption, at par value, of $10 million of 10% notes, plus accrued interest. It said that with the redemption, Arch now had $190 million principal amount of the 10% notes outstanding, and said that it had given The Bank of New York notice of its intention to redeem another $15 million of the notes on Aug. 30. Only holders of record as of Aug. 15 could participate in the transaction. Arch said that creditors that had not yet tendered their letters of transmittal to The Bank New York would not be eligible to receive a cash distribution in connection with the Aug. 30 redemption unless such letters of transmittal had been received by the exchange agent by Aug. 14.

On Aug. 30, Arch Wireless said that its subsidiary had completed the previously announced redemption, at par value, of $15 million of its 10% notes, plus accrued interest. It said that with the redemption, the second in recent weeks, Arch now had $175 million principal amount of the 10% notes outstanding, and said that it had given The Bank of New York notice of its intention to redeem another $15 million of the notes on Sept. 30. Only holders of record as of Sept. 16 could participate in the transaction.

On Sept. 30, Arch said that its subsidiary had completed the previously announced redemption, at par value, of $15 million of its 10% notes, plus accrued interest. It said that with the redemption, the third in recent weeks, Arch now had $160 million principal amount of the 10% notes outstanding, having redeemed a total of $40 million of the $200 million of the notes that were originally issued. Arch did not at that time announce plans for a further redemption of the notes.

On Nov. 2, Arch said that its subsidiary had notified The Bank of New York, as trustee, of its intention to redeem, at par value, another $35 million principal amount of the 10% notes on Dec. 31, with a record date for the transaction of Dec. 16.

Arch also disclosed that the company had completed a mandatory redemption payment of $15 million, plus accrued interest, on Nov. 15, bringing the amount of the remaining outstanding notes down to $145 million from $160 million previously. It said that upon the completion of the planned $35 million redemption on Dec. 31, Arch will have redeemed $90 million of the $200 million of the bonds which were originally issued on May 29, after Arch's financial restructuring was completed. The $90 million would include the $35 million being redeemed on Dec. 31, the $15 million November redemption and the $40 million total redeemed in three separate previously announced transactions which took place in July, August and September. Following the Dec. 31 redemption, Arch said it would have $110 million of the notes remaining outstanding.

Equinix completes exchange offer for 13% '07 notes

Equinix, Inc. said on Tuesday (Dec. 31) that it had completed its previously announced offer to exchange cash and common stock for its remaining outstanding 13% senior notes due in 2007, as well as related financing transactions.

The exchange offer expired as scheduled at 5 p.m. ET on Dec. 27, with no further extension. As of the deadline, noteholders had tendered more than $116 million of the notes, leaving approximately $30 million of the notes still outstanding. The company said that including the latest transaction, it has now retired approximately 85% of the $200 million of the notes originally issued.

The company also said that it had reduced its senior credit facility by $8.5 million to $91.5 million, renegotiated certain terms of the credit facility including the adjustment of the principal amortization schedule, and reset covenants based upon current market conditions for the remaining term of the facility.

Equinix additionally said that it had held a special shareholders meeting as scheduled on Monday (Dec. 30), at which time shareholders approved several previously announced transactions, including the issuance of new stock to facilitate the debt retirement, and a 1-for-32 reverse stock split, which took effect on Tuesday, aimed at bringing the share price up to acceptable levels for Nasdaq listing purposes.

If further announced the completion of previously announced transactions involving Singapore Technologies Telemedia Pte Ltd. and Pihana Pacific.

ST Telemedia, through its subsidiary STT Communications Ltd, has made a $30 million strategic investment in Equinix, which has merged the assets of ST Telemedia's wholly-owned Internet infrastructure services subsidiary, i-STT, into its business. Equinix also completed the acquisition of Pihana Pacific, a leading provider of neutral Internet exchange data center services and managed e-infrastructure services in Asia-Pacific. That transaction included the contribution of more than $26 million of cash from Pihana's balance sheet. By integrating i-STT and Pihana Pacific into its business, Equinix said it becomes the largest global network-neutral Internet exchange services company.

AS PREVIOUSLY ANNOUNCED, Equinix, a Mountainview, Calif.-based provider of core Internet exchange services, said on March 7 that it had retired $25 million of the 13% notes in exchange for approximately nine million shares of common stock. The company said the retirement of these notes would result in an annual savings of approximately $3.25 million in interest expense, which would be realized over the full year beginning in fiscal 2002. As of the date of that release, Equinix said it had reduced its interest payments on the retired senior notes beginning January, 2002 through December, 2007 by $19.5 million. Together with the $25 million in principal payments that would otherwise have come due in December 2007, Equinix said it had reduced its debt service on the retired senior notes by nearly $45 million. With the transfer of the nine million shares to the former holders of the $25 million of retired notes, Equinix said the total number of common stock shares outstanding upon completion of the exchange was approximately 89 million shares.

On June 12, Equinix said that it had retired an additional $10 million of the 13% notes; including the $42 million of senior notes which were retired in debt exchanges in the first half of 2002, that brought the total face amount of the notes which had been retired at significant discounts as of that date to $52 million. The company said that since October, 2001, it had reduced its total outstanding debt by $97 million, including the retirement of $45 million in senior credit facility debt in October, 2001. The debt reductions reduced the company's annual interest expense by nearly $10 million, with the company's total debt obligations, including principal and interest over the term of the debt, to be reduced by approximately $150 million.

Equinix additionally announced the filing of a proxy statement with the Securities and Exchange Commission calling for a special stockholders' meeting to approve the potential issuance of up to 15 million shares of common stock in exchange for the retirement of additional senior notes. The total number of common stock shares outstanding as of the date of that announcement was 96.9 million shares. Equinix said that the ability to issue additional common shares would give it greater flexibility and options to de-leverage the company. While Equinix said it did not expect to transact any additional debt-for-equity exchanges in the near term at the then-current stock trading level, the availability of additional authorized shares would enable the company to take advantage of favorable debt-for-equity exchange opportunities as market conditions improved.

On Nov. 26, Equinix said that it was offering to exchange cash and common stock for all $147.2 of its 13% senior notes due in 2007 that remain outstanding (out of the originally issued $200 million, which was reduced to present levels by earlier equity-for-debt exchanges).

The company said that it had already received offers to exchange their notes from holders of $103.7 million of the notes, or approximately 70% of the remaining outstanding principal amount. It did not publicly announce the terms of the exchange offer, which were contained in the official Offer to Exchange and Consent Solicitation Statement delivered to the noteholders. It said that the amount of cash to be exchanged and the amount of common stock shares to be issued in exchange for each principal amount of notes tendered would vary, depending on the aggregate principal amount of the notes that tendered.

The tender offer was initially set to expire at 5 p.m., ET on Dec. 24 (this was subsequently extended). Tenders of notes could be withdrawn at any time prior to the deadline.

Equinix further said that as a result of the tender offer, it would not be paying the scheduled Dec. 1 interest payment on the outstanding notes. The company said that its bondholders and senior lenders were continuing to work with Equinix to afford it sufficient time and flexibility to effect the proposed acquisitions and financing as announced on Oct. 2.

On Dec. 11, Equinix announced that it had scheduled a special stockholder meeting to vote on its previously announced plans to issue shares in connection with the financing and acquisitions of i-STT and Pihana Pacific.

The company said the stockholders' meeting would be held on Dec. 30 in New York, subject to possible further extension.

On Dec. 12, Equinix said that it had extended the exchange offer for the 13% notes to 5 p.m. ET on Dec. 27, subject to possible further extension, from the originally announced Dec. 24 deadline.

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