IdleAire to buy back some 13% discount notes with IPO proceeds

By Angela McDaniels

Seattle, Sept. 18 - IdleAire Technologies Corp. plans to repay a portion of its $320 million 13% senior discount notes due 2012, according to an S-1 filing with the Securities and Exchange Commission.

The company will fund the buyback with some of the proceeds from its upcoming initial public offering of common stock. Remaining proceeds will be used to fund the growth of IdleAire's network of ATE Advanced Travel Center Electrification system locations, for working capital and for other general corporate purposes.

On Friday, IdleAire successfully completed a consent solicitation for the notes and the 320,000 warrants issued with the notes. The consents allowed the company to amend the note indenture to:

• Add a provision requiring the company, upon closing of the IPO, to raise net proceeds of at least $100 million on or before June 30, 2008;

• Require IdleAire to issue and deliver to an escrow account 7,204,835 shares of common stock, representing about 5% of IdleAire's shares outstanding on the record date, for beneficial owners of the notes; and

• Amend the cash flow provision so that IdleAire is no longer obligated to deliver contingent warrants once the restricted common shares are delivered. Previously, the company was required to issue additional warrants to noteholders on June 15, 2009 to purchase up to 10% of its outstanding common stock if its consolidated cash flow for 2008 does not equal or exceed $40 million.

The consents also allowed IdleAire to modify the warrant agreement to provide for a 180-day lock-up of the existing warrants and the underlying shares following the IPO.

Based in Knoxville, Tenn., IdleAire is a privately held research and development company that provides products and services for the long-haul trucking freight industry.

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