Norcraft extends tender offer for 9¾% notes, increases purchase cap

By Angela McDaniels

Tacoma, Wash., Dec. 3 - Norcraft Holdings, LP increased the maximum principal amount of notes it will buy in the tender offer for its and Norcraft Capital Corp.'s 9¾% senior discount notes due 2012 to $64.3 million from $35 million, according to a company news release.

In addition, the company extended the offer expiration to midnight ET on Dec. 16 from Dec. 15 and amended the offer so that all holders who tender will receive the early tender premium of $10.00 per $1,000 principal amount of notes.

Previously, only holders who tendered by 5 p.m. ET on Dec. 1 would have received the premium.

The purchase price is $1,023.38 for each $1,000 principal amount plus accrued interest up to but excluding the settlement date.

If the principal amount of notes tendered exceeds the cap, the company will purchase an amount of notes up to the cap on a pro rata basis.

As of 5 p.m. ET on Dec. 1, holders had tendered $116 million principal amount, or approximately 98.3%, of the notes.

The company is also soliciting consents to amend the note indenture to:

• Allow Norcraft Intermediate Holdings, LP, Norcraft Cos., LP or any restricted subsidiary of the latter to incur debt in excess of the amount otherwise permitted by the indenture provided that the proceeds are distributed to Norcraft Holdings and used to redeem, repurchase, acquire, defease or discharge 9¾% notes within 90 days;

• Allow Norcraft Holdings to incur debt in excess of the amount otherwise permitted by the indenture provided that the proceeds are used to redeem, repurchase, acquire, defease or discharge 9¾% notes within 90 days; and

• Disregard "consolidated interest expense" as defined in the indenture related to any debt incurred under the above provision for the purposes of determining whether any debt may be incurred in reliance upon the "coverage ratio exception" concurrently with incurring such debt.

Holders who delivered consents prior to 5 p.m. ET on Nov. 23 will receive $1.00 in cash per $1,000 principal amount of notes.

Holders who tendered their notes prior to the consent expiration time will be deemed to have delivered their consent, even if those tendered notes are not purchased due to proration. Holders may not deliver consents without tendering notes.

The tender offer and consent solicitation began Nov. 17.

The consent solicitation is subject to the receipt of consents from holders of at least a majority of the principal amount of notes outstanding.

The tender offer is conditioned on the execution of a supplemental indenture implementing the amendments and the successful completion of a proposed private placement of senior secured notes by some of Norcraft Holdings' subsidiaries, the proceeds of which will be used in combination with cash on hand to fund the tender offer.

UBS Investment Bank (888 719-4210 or collect at 203 719-4210) is the dealer manager, and Global Bondholder Services Corp. (866 873-7700) is the information agent.

Norcraft is a cabinetry company based in Eagan, Minn.

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