Friendly Ice Cream receives tenders of $127.8 million 10½% notes

New York, March 16 - Friendly Ice Cream Corp. said $127.8 million principal amount or 72.6% of its outstanding 10½% senior notes due 2007 were tendered by the expiration of its offer to buy them for cash.

The offer expired at 12:01 a.m. ET on March 16.

Friendly's added that it called the remaining notes. They will be redeemed on April 8 at 103.5% of par plus accrued interest to April 8.

The amount tendered is up marginally from the 72.4% or $127.4 million that had been tendered by the consent participation deadline of 5 p.m. ET on March 1.

Friendly Ice Cream said on Feb. 17 it had begun a cash tender offer for all its $176 million outstanding principal amount of 10½% notes.

The Wilbraham, Mass., company was also soliciting consents to amend the note indentures to eliminate substantially all of the restrictive covenants and certain related events of default.

Holders who tendered by the consent payment deadline of 5 p.m. ET on March 1 received $1,040 per $1,000 principal amount including a consent payment of $20 per $1,000 principal amount.

Holders who tendered after the consent deadline but before the expiration will receive $1,020 per $1,000 principal amount.

In both cases, Friendly will pay accrued interest up to but not including the payment date.

Holders may not consent without tendering and may not revoke consents without withdrawing the notes.

The offer was subject to various conditions including receipt of consents for a majority by principal amount of the outstanding notes and completion of an offering of $165 million of new senior notes.

Funding will come from the note offering, available cash and borrowings under an amended credit facility.

Goldman, Sachs & Co. was the dealer manager (800 828-3182). D.F. King was the information agent (800 487-4870).

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