Jack Cooper holders tender all preferreds, no additional 12¾% notes

By Susanna Moon

Chicago, July 1 - Jack Cooper Holdings Corp. said holders had tendered no more of its 12¾% senior secured notes due 2015 since the consent payment deadline of 5 p.m. ET on June 14.

As reported previously, holders had tendered $136,709,000 principal amount, or about 87%, of the 12¾% notes.

The company also tendered for its series B non-convertible preferred shares, and holders had tendered 370,000, or all, of the company's series B non-convertible preferred shares, according to a company press release.

Both offers ended at 11:59 p.m. ET on June 28, and settlement has been slated for July 3.

12¾% notes offer

Jack Cooper said on June 17 that holders had tendered 87% of its outstanding 12¾% notes, which was enough to amend the notes to eliminate most of the restrictive covenants and events of default and to release all liens of the collateral agent of the collateral securing the notes.

The company needed to get consents from at least 66 2/3% of the outstanding notes in order to amend the notes, according to a previous press release.

The supplemental indenture became operative when the notes were accepted for purchase on June 18.

As noted before, the total purchase price was $1,071.25 for each $1,000 principal amount of notes tendered by the consent date. The total payout included a consent payment of $30.00 per $1,000 of notes.

The tender offer began June 3.

Those who tendered after the consent date will receive base payment of $1,041.25 per $1,000 of notes.

Holders will also receive accrued interest up to but excluding the payment date for the notes.

Holders who tendered their notes had to consent to the proposal, and holders who gave consents needed to tender their notes.

After settlement on June 18, the company called the remaining notes for redemption at 106.375% of par plus accrued interest to the redemption date of July 18.

Wells Fargo Securities, LLC (866 309-6316 or 704 410-4760) is the dealer manager and solicitation agent. D.F. King & Co., Inc. (800 829-6551 or 212 269-5550) is the depositary and information agent.

Series B preferred stock

The company also offered to purchase all outstanding shares of its series B preferred stock and concurrently solicited consents, in lieu of a special stockholders meeting, to a single proposal that will authorize certain proposed amendments, as noted on June 3.

The amendments alter the certificate of designations dated May 5, 2011 governing the stock to eliminate

• Voting rights relating to affiliate transactions, the issuance of senior securities and the issuance of parity securities and dividend default voting, including voting after a redemption failure;

• All rights relating to board appointments and observers;

• The requirement that at least $15 million of the original purchase price of the series B preferreds remain outstanding after a partial redemption;

• All rights to force a sale of the company following a redemption failure; and

• Section 6.4 of the securities purchase agreement dated April 21, 2011 providing that holders of the preferreds will receive annual, quarterly and current reports in the form required to be delivered to holders of certain new notes to be issued by the company in accordance with the indenture governing those notes.

The total payment will be (a) 120% of the original purchase price plus (b) 120% of accrued interest from June 30 through the payment date plus (c) an amount equal to the daily dividend accrual multiplied by 28, which is the difference between the minimum number of days' notice that would be given for repurchase of series B preferreds if the tender offer were not made or shares were not tendered.

The company will also pay a consent payment of $0.05 per share for a total consideration of $121.87 for each validly tendered share.

Holders who tendered their shares were required to consent to the proposed amendments and vice versa.

The company previously said it might repurchase or redeem any and all shares that remain outstanding after the tender offer at prices more or less than those paid in the offer.

The tender offer and consent solicitation were contingent on proceeds of at least $225 million from the company's planned debt financing, consents representing at least 50.1% of shares, approval by the board and by class A common stockholders, the filing of a certificate of amendment to the certificate of designations with the Secretary of State of Delaware and other general conditions.

Wells Fargo is the dealer manager and solicitation agent. Paul Hastings LLP (404 815-2276) is the depositary and information agent.

The company said it planned to use the proceeds of its proposed debt financing, along with borrowings under its amended and restated revolving credit facility, to fund the tender offer and consent solicitations as well as repay other debt and redeem preferred stock.

Jack Cooper priced a $225 million issue of seven-year senior notes at par to yield 9¼% on June 7, as reported by Prospect News.

Jack Cooper Holdings is a Kansas City, Mo.-based vehicle transportation services company.

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