Reddy Ice receives consents to amend 8 7/8% notes, sets tender price

New York, April 13 - Reddy Ice Group, Inc. said it received the necessary consents to amend its $152 million principal amount of 8 7/8% senior subordinated notes due 2011 and set the price in the tender offer.

By 5 p.m. ET on April 12 the company had received consents for 89.1% of the notes.

The company said it plans to execute a supplemental indenture but added that the changes will only become effective when it buys the notes.

Reddy Ice also said that it will pay $1,121.27 per $1,000 principal amount for notes tendered by the consent deadline, including a $20.00 per $1,000 consent payment. The figure assumes a payment date of April 29.

Holders will also receive accrued interest.

At its last announcement on April 5, Reddy Ice increased the payment on offer and extended the deadlines.

Pricing is now based on a 50 basis point spread over the reference security instead of a 75 basis point spread.

The deadline to receive the consent payment is now 5 p.m. ET on April 12 instead of 5 p.m. ET on April 5, and the tender ends at 5 p.m. ET on April 28 instead of 5 p.m. ET on April 21.

The Dallas ice maker announced the tender on March 23 and said it is also soliciting consents to amend the note indenture to eliminate substantially all of the restrictive covenants and certain events of default.

Reddy Ice will pay 35% of the equity clawback price of $1,088.75 per $1,000 principal amount plus 65% of the fixed spread price. The fixed spread price is the present value on the payment date of all future cash flows on the notes to their first call date on Aug. 1, 2007 minus accrued interest up to but excluding the payment date based on 50 basis points over the bid-side yield on the 3.25% U.S. Treasury note due Aug. 15, 2007. Pricing will now be at 2 p.m. ET on April 13 instead of 2 p.m. ET on April 6.

The total includes the $20.00 per $1,000 consent payment.

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

The tender is subject to a majority of the notes being tendered and Reddy Ice having the sufficient funds for the tender from a new senior credit facility and an initial public offering of stock by parent company Reddy Ice Holdings, Inc.

Credit Suisse First Boston LLC is dealer manager and solicitation agent (contact Liability Management Group at 800 820-1653 or call collect 212 538-0652). Morrow & Co., Inc. is the information agent (800 654-2468 or call collect 212 754-8000).

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