Temple-Inland Inc. (TIN) (Baa2/BBB) said Monday (Oct. 29) that it had extended the expiration deadline of its previously announced tender offer for the outstanding 9 3/8% senior notes due 2007, the 9¾% senior notes due 2007 and the 9 7/8% senior subordinated notes due 2008 of GAYLORD CONTAINER CORP. (GCR) (senior at Caa2/CCC+; subordinated at Caa3/CCC) to midnight ET on Nov .9 from Oct. 26 previously. It also concurrently extended the expiration deadline for all of Gaylord Container's outstanding common shares. Temple Inland said that as of the previous expiration deadline, stockholders had tendered 46,462,899 common shares, or about 83% of the number outstanding. Debtholders had tendered $3.813 million of the 9 3/8% notes, $5.339 million of the 9¾% notes, and $2.19 of the 9 7/8% notes. During the extended tender period, ongoing discussions with the noteholders representing a majority of each series of the notes are continuing. AS PREVIOUSLY ANNOUNCED, Temple-Inland, an Austin, Tex.-based maker of packaging materials, said Sept. 28 that it would acquire all of the outstanding junk bond debt of Gaylord, as part of its $786 million acquisition of the Deerfield, Ill.-based packaging materials maker. Temple-Inland said it would also tender for all of Gaylord's outstanding shares, and said certain outstanding bank debt and other senior secured debt obligations of Gaylord would be paid or otherwise satisfied. The $786 million figure assumes that all shares and all notes are tendered, and is broken down into approximately $100 million to purchase all of the shares at $1.80 per share, and approximately $686 million to acquire all the notes and to satisfy the bank debt and other senior secured debt obligations. The equity and debt tender offers were originally scheduled to expire on Oct. 26, but have since been extended; Temple Inland, which is also seeking the consent of the Gaylord noteholders to amending the notes' indentures to remove certain restrictive covenant and other Gaylord contractual obligations, initially set midnight ET on Oct. 12 as the consent payment deadline, but subsequently announced on Oct. 11 that it had also extended that deadline to Oct. 26; there was no subsequent announcement of any official extension beyond that date. The Temple Inland announcement followed a hearing on a motion for a temporary restraining order filed in the U.S. District Court for the Southern District of New York by Absolute Recovery Hedge Fund, LP and Absolute Recovery Hedge Fund, Ltd., and represented an agreement among the parties, including Temple-Inland, Gaylord and the notes trustee, State Street Bank and Trust Company, as defendants, plus the two Absolute funds. The court scheduled a hearing on a motion for a preliminary injunction for Oct. 23, but there was no immediate word on its outcome. Holders of the 9 3/8% and 9¾% senior notes tendering by the extended consent deadline would receive total compensation of $755 per $1,000 principal amount, including a $20 per $1,000 consent payment. Holders of the 9 7/8% senior subordinated notes would receive total consideration of $260 per $1,000 principal amount, including the $20 consent payment. The overall merger transaction between Temple-Inland and Gaylord is contingent upon Temple-Inland receiving at least 90% of the outstanding amount of each series of the notes, with those notes having been validly tendered and not withdrawn prior to the expiration of the offer. The merger deal is also contingent upon, among other things, Temple-Inland getting at least two-thirds of the outstanding Gaylord shares, as well as regulatory approval and the satisfaction or waiver of customary closing conditions. This transaction is not conditioned upon financing, since Temple-Inland has received a financing commitment from Citibank, NA to fund its offer for all outstanding Gaylord Container shares and the notes, as well as to satisfy the bank debt and other senior secured debt obligations, and pay costs and expenses associated with the transaction. Gaylord's Board of Directors has unanimously recommended that its shareholders accept the Temple Inland offer and tender their shares. Deutsche Banc Alex. Brown and Rothschild Inc., acted as financial advisors to Gaylord. Salomon Smith Barney Inc. (800-558-3745) is acting as dealer/manager for Temple-Inland in connection with the tender offer for the notes. The information agent is D. F. King & Co., Inc. (bankers and brokers call 212-269-5550; all others call 800-549-6650). Computershare Trust Company is the depositary for both the share and the note tender offers.

LORAL SPACE & COMMUNICATIONS LTD. (LOR) (B3/CCC+) said Oct. 26 that its wholly owned LORAL CYBERSTAR INC. (Ca/CCC) unit (formerly known as LORAL ORION) will offer to exchange new debt and stock warrants for about $927 million of existing debt - $443 million of 11¼% senior notes and $484 million (face amount; accreted value as of Oct. 15 $470 million) of zero-coupon/12½% senior discount notes, both due 2007. The New York-based telecommunications satellite equipment maker and operator said that in exchange, the bondholders will receive $675 million of new 10% senior notes due 2006, with $332.4 million to go to the holders of the 11¼% notes and $342.6 million to go to the 0%/12½% notes, assuming the existing debt is fully exchanged. The new notes would be fully guaranteed by Loral Space, while the existing notes are non-recourse to Loral. Besides the new debt, existing noteholders would also receive five-year warrants to buy up to 6.7 million shares of Loral Space stock, at a purchase price that would be 110% of the shares' price over a 10-day period preceding the close of the exchange offer. Loral said that completion of the exchange is conditioned upon its acceptance by the holders of at least 85% of the notes, and said holders of more than 50% of the notes had already agreed to the exchange proposal. It further said that assuming the exchange offer is completed, bondholders choosing not to participate will be allowed to keep their old debt, but will lose the benefits of "substantially all" of their covenant protections. Loral did not announce a timetable for the planned note exchange.

YOUNG BROADCASTING INC. (YBTVA) (B2/BB-) said Oct. 26 that it has begun soliciting consents to proposed indenture changes from the holders of its 9% senior subordinated notes due 2006. The New York-based television station ownership group said that it will pay consenting holders $10 per $1,000 principal amount, in cash, if the proposed amendments become effective. The consent solicitation will expire at 5 p.m. ET, on Nov. 5, subject to possible extension. The proposed amendments to the 9% notes' indenture are conditioned upon, among other things, receipt of the requisite consents in the consent solicitation, consummation of a proposed offering of new senior notes, and the amendment of the company's senior credit facility. Young Broadcasting said that subject to market conditions, it intends to offer up to $250 million of new senior unsecured notes in a private placement, and added that it has that it has requested that its senior lenders agree to certain amendments to Young's senior credit facility. The net proceeds from the proposed new senior note offering will be used to repay debt under the senior credit facility. The issuance of the new senior notes is subject to the successful completion of the consent solicitation. The proposed amendments to the senior credit facility address, among other things, possible financial covenant issues which may arise at Dec. 31, 2001 and in future years. Deutsche Banc Alex. Brown Inc. (212-469-8995), CIBC World Markets Corp. and First Union Securities, Inc. will be the solicitation agents; D.F. King & Co., Inc. (800-714-3305) is acting as the information agent.

FOUR SEASONS HOTELS INC. (FS) recently announced that it plans to redeem all of its C$100 million of 6% debentures due 2002, effective Nov. 14. The Toronto-based lodging company said in its Oct. 5 announcement that the debentures would be redeemed for a total price of C$102,118,820, plus accrued and unpaid interest up to - but not including - the redemption date. Four Seasons said it would fund the redemption from existing cash balances. It said that following the repayment of the debentures, its only remaining long-term debt would be its zero-coupon convertible debt, with an ultimate maturity date of 2029.

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