Simmons Foods gets consents needed to amend 10˝% second-lien notes

By Angela McDaniels

Tacoma, Wash., Oct. 1 – Simmons Foods, Inc., Simmons Prepared Foods, Inc., Simmons Pet Food, Inc., Simmons Feed Ingredients, Inc., Simmons Custom Processing, Inc., Simmons Energy Solutions, Inc. and Pro*Cal, Inc. (collectively “Simmons”) have received enough consents to amend the indenture governing their $315 million of 10˝% second-lien senior secured notes due 2017, according to a company news release.

As previously reported, a tender offer and consent solicitation for the notes began Sept. 17. The consent date was 5 p.m. ET on Sept. 30.

Holders had tendered $263 million, or 83.5%, of the notes as of the consent date.

The amendments became operative when the notes that were tendered by the consent date were accepted for payment and paid for on Oct. 1.

Among other things, the amendments eliminate a significant portion of the restrictive covenants, eliminate some events of default, release all of the collateral and amend the number of days prior to any redemption date that Simmons must send a notice of redemption.

The adoption of the amendments required the consent of the holders of at least a majority of the outstanding principal amount of the notes or, in the case of the amendment to release all of the collateral, of at least two-thirds of the outstanding notes.

Holders could not tender their notes without delivering consents or vice versa.

The tender offer will continue until 11:59 p.m. ET on Oct. 15.

The company paid $1,058.75 for each $1,000 principal amount of notes tendered by the consent date. This included a consent payment of $30.00.

Holders who tender after the consent date but prior to the offer expiration will receive $1,028.75 for each $1,000 principal amount of notes.

In each case, the company is also paying accrued interest up to but excluding the applicable payment date.

The tender offer and consent solicitation are subject to the completion of a debt financing transaction by Simmons, the receipt of the requisite consents and the supplemental indenture implementing the proposed amendments being executed and delivered (other than the proposed amendments relating to the release of the collateral).

The company priced $415 million of seven-year second-lien senior secured notes (Caa1/CCC+/) at par to yield 7 7/8% on Sept. 18. The issue was expected to settle Oct. 1.

The dealer manager and solicitation agent is Wells Fargo Securities, LLC (704 410-4760 or 866 309-6316). The tender agent and information agent is D.F. King & Co., Inc. (800 431-9645 or, for banks or brokers, 212 269-5550).

Simmons is a vertically integrated poultry processor based in Siloam Springs, Ark.

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