Arch Wireless to redeem 10% '07 notes

Arch Wireless, Inc. said on Monday (July 8) that its wholly owned Arch Wireless Holdings, Inc. subsidiary has given notice of its intention to redeem $10 million principal amount of its 10% senior subordinated secured Notes due 2007. Arch said that it expects to redeem the notes on July 31. The redemption transaction will 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 will be entitled to receive cash distributions in connection with the redemption. Creditors of Arch that have not yet tendered their letters of transmittal to The Bank New York in accordance with Arch's Joint Plan of Reorganization will not receive a cash distribution in connection with the redemption. unless their letter of transmittal is received by the exchange agent by July 15. Accordingly, Arch strongly urges 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 - will further lower the company's interest expense and generate greater financial flexibility.

AS PREVIOUSLY ANNOUNCED, Arch - 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 last Dec. 6. All previously outstanding equity securities, including common stock and preferred stock, and all options and other rights to acquire Arch securities were cancelled.

L-3 completes 10 3/8% '07 notes tender offer; remaining notes being redeemed

L-3 Communications (Ba3/BB) said on Wednesday (July 3) that its L-3 Communications Corp. subsidiary had completed its previously announced cash tender offer for all of its outstanding 10 3/8% senior subordinated notes due 2007, which expired as scheduled at 5 p.m. ET on July 3 without extension. As of that deadline, L-3 had accepted tenders of notes from holders of $177.195 million of the notes, or approximately 79%) of outstanding amount, under terms of the official Offer to Purchase dated June 6. It said that payment for the Notes tendered after the previously announced June 24 early tender deadline would be made on Friday (July 5), with payment for the notes tendered before the early tender deadline having already been made, on June 28. L-3 said that the remaining $47.805 million of notes that were not tendered by the expiration deadline would be subject to its previously announced full redemption.

AS PREVIOUSLY ANNOUNCED, L-3 Communications, a New York-based maker of defense and aerospace electronics, said on June 6 that it had begun a tender offer for all of its outstanding $225 million of 10 3/8% notes through L-3 Communications Corp., a wholly owned subsidiary. It said the offer was scheduled to expire at 5 p.m. ET on July 3, subject to possible extension, although it also initially set an early tender deadline of 5 p.m. ET on June 19, which was subsequently extended. The total consideration to be paid for each validly tendered note accepted for payment would be $1,053.50 per $1,000 principal amount of notes, plus accrued and unpaid interest. That total consideration would include an early tender premium of $20 per $1,000.00 principal amount, for holders tendering their notes by the extended early tender deadline. Holders tendering their notes after the early tender deadline but before the expiration would receive $1,033.50 per $1,000 principal amount, plus accrued and unpaid interest. Tenders of notes made by the early tender deadline could not be validly withdrawn or revoked, unless L-3 were to reduce the tender offer consideration or the principal amount of notes subject to the tender offer, or unless the company was otherwise required by law to permit withdrawal. It further said that tenders of notes made after the early tender deadline could be validly withdrawn at any time until the expiration deadline. L-3 said the tender offer would be conditioned upon the satisfaction of certain financing conditions (L-3 separately announced plans on June 6 to sell $750 million of 10-year Rule 144A senior subordinated notes and use a portion of the proceeds to repurchase the 10 3/8% notes; it said it would also use some of the proceeds to repay outstanding debt under its senior subordinated interim loan agreement). It would also be subject to the satisfaction of other customary conditions. L-3 said that if the tender offer were consummated, it planned to promptly afterward call for redemption - in accordance with the amended terms of the indenture governing the notes - all notes remaining outstanding. The remaining notes would be redeemed at the applicable price of $1,051.88 per $1,000 principal amount, plus interest accrued up to the redemption date.

On June 19, L-3 said that it had extended the early tender deadline to 5 p.m. ET on June 24, subject to possible further extension, from the originally announced June 19 deadline. The company said that holders tendering by the early tender deadline would be eligible for a payment as part of their total consideration, and that all other previously announced provisions and terms remained unchanged. On June 25, L-3 announced that it had initiated a full redemption of any of the 10 3/8% notes which would remain outstanding following its tender offer. It said that as of the previously announced early tender period expiration at 5 p.m. ET on June 24, it had received tenders from the holders of $176.925 million (approximately 79%) of the outstanding notes. It said that all notes not tendered under the then-current offer, set to expire on July 3, would be redeemed on July 25, at a redemption price of 105.188% of the principal amount (i.e., $1,051.88 per $1,000 principal amount) , plus accrued and unpaid interest up to July 25. The company said that holders should present their notes to The Bank of New York, as paying agent for the redemption, at the address set forth in the official Notice of Redemption, which was sent to all registered noteholders. Interest on the notes would cease to accrue on and after July 25, so that the only remaining right noteholders would have after that would be to receive payment of the redemption price upon surrender to the paying agent, plus accrued and unpaid interest up to - but not including - July 25. Separately, high yield market syndicate sources heard on June 25 that L-3 had sold $750 million of new 7 5/8% senior notes due 2012, a portion of the proceeds of which would be slated to be used to repurchase the outstanding 10 3/8% notes. Lehman Brothers (call Scott Macklin at 212 528-7581or toll free at 800 438-3242) is the dealer manager for the tender offer. Georgeson Shareholder Communications, Inc., (call 866-283-1866) is the information agent.

Graham Packaging tenders for 10 ¾% '09 notes

GPC Capital Corp. II, an affiliate of Graham Packaging Co. Inc., (Caa1/CCC+) said on Wednesday (July 3) that it was beginning a cash tender offer for the outstanding 10¾% senior discount notes due 2009 issued by the Graham Packaging Holdings Co., and a related solicitation of consents from registered noteholders to proposed indenture changes. The tender offer will expire at 5 p.m. ET on July 31, subject to possible extension. Graham said that the total consideration for the notes will be based on a 75-basis point fixed spread over the yield to the earliest redemption date on the applicable U.S. Treasury Note, and will include a consent payment of $20 per $1,000 principal amount at maturity of notes tendered by the consent deadline of 5 p.m. ET on July 17, subject to possible extension, which automatically render consent to the proposed indenture changes. Those proposed indenture amendments would (a) eliminate most of the notes' restrictive covenants including, without limitation, the covenants limiting the incurrence of debt, restricted payments, transactions with affiliates, asset sales and dividend and other payment restrictions affecting subsidiaries, (b) eliminate limitations on mergers, consolidations, (c) eliminate certain events of default and (d) modify certain repurchase and defeasance provisions. The tender offer is being undertaken in connection with Graham Packaging's previous internal reorganization effort. Graham plans to fund the tender offer using the expected net proceeds from its previously announced planned initial public offering. The offer is conditioned upon the receipt of the consents necessary to adopt the proposed amendments. The amendments will only become operative if a majority of the outstanding aggregate principal amount of notes are tendered. The offer is also conditioned upon, among other things, the completion of the initial public offering, as well as a previously announced senior subordinated notes offering and a previously announced bank refinancing. Graham said the proposed amendments will be effective for all notes that are not purchased under the tender offer when the offer is consummated, provided all other conditions to the Offer have otherwise been satisfied. If the proposed amendments become operative, the adoption of those proposed amendments requires the consent of holders of at least a majority of the outstanding notes. After the internal reorganization, the Graham will remain as the sole issuer of the notes.

AS PREVIOUSLY ANNOUNCED, Graham Packaging was heard by high yield syndicate sources on May 28 to be planning to sell $100 million of six-year senior subordinated notes, with the deal proceeds slated to be used for the repurchase of the York, Pa.-based plastic container company's outstanding $169 million ($155.7 million accreted value) of senior discount notes, and to repay bank debt. Market sources said that Deutsche Bank Securities Inc. would be the book-running manager on the upcoming offering. The bond deal is part of a recapitalization plan that includes a new $700 million senior credit facility (comprised of a $550 million term loan and a $150 million revolver), and an initial public offering of up to $287.5 million of common shares. On May 30, Graham Packaging Co. said that it, a wholly-owned subsidiary, GPC Capital Corp. I, and its GPC Capital Corp. II affiliate had filed a registration statement with the Securities and Exchange Commission for an offering of senior subordinated notes in a proposed aggregate maximum offering amount of $100 million. It said the notes would be co-issued by Graham Packaging Co. and GPC Capital Corp. I, and would be guaranteed by GPC Capital Corp. II, which intends to undergo a reorganization in which it will change its name to Graham Packaging Company Inc., become the parent company of the issuers and effect its IPO of common stock. GPC Capital Corp. II filed a registration statement with respect to its initial public offering on May 24. The offering is part of a refinancing plan designed to reduce the amount and extend the maturities of Graham Packaging's long-term debt, reduce interest expense and improve financial flexibility. Graham Packaging said it expects to use net proceeds from the bond offering plus proceeds from new indebtedness and any remaining proceeds from Graham Packaging Company Inc.'s initial public offering of common stock after its repurchase of certain indebtedness, to refinance certain of its existing indebtedness. Deutsche Bank Securities Inc. and Salomon Smith Barney Inc. are to be will be the joint book-running managers for the bond offering.

Deutsche Bank Securities Inc. (call 800 553-2826) and Salomon Smith Barney Inc. (call 800 558-3745) are acting as the dealer managers for the tender offer and consent solicitation. The information agent is MacKenzie Partners, Inc. (call 212 929-5500 or 800 322-2885). The depositary is The Bank of New York.

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