Reddy Ice issues $137.6 million 13¼% notes in exchange for 10½% notes

By Susanna Moon

Chicago, March 15 - Reddy Ice Holdings, Inc. said that its subsidiary Reddy Ice Corp. issued $137.6 million principal amount of 13¼% senior secured notes due 2015 in the exchange offer and consent solicitation for its outstanding 10½% senior discount notes due 2012.

The company said that $136.9 million principal amount of the 10½% notes were exchanged.

Upon the issuance of the second-lien notes, the amendments to the 10½% notes became operative.

At the previous announcement on March 5, Reddy Ice said it had received tenders for 91.0% of its 10½% senior discount notes due 2012 by the early tender date of 5 p.m. ET that same day.

The company had previously announced on March 3 that it received the necessary consents to amend the notes.

Holders will receive new senior secured notes for the 10½% notes.

The consent solicitation was to amend the notes to eliminate substantially all of the restrictive covenants and some events of default.

For each $1,000 principal amount of old notes, the company will issue an equal amount of new 13¼% senior secured notes due 2015 of Reddy Corp. plus an additional $5 principal amount of new notes for those who tendered prior to the early tender date.

Holders tendering the notes for exchange will be deemed to have consented to the proposed amendments, and holders may not deliver consents without tendering their notes.

The offer requires that Reddy Corp. enter into a new revolving credit facility and the termination and repayment of all debt under the existing credit facility, the company previously noted. Reddy Corp. must also issue first-lien notes with proceeds sufficient to refinance its credit facility.

Reddy Corp. said it has the right to waive these conditions or to terminate or withdraw the exchange offer and consent solicitation at any time and for any reason prior to the fulfillment or waiver of the conditions to the offer.

At the previous announcement, Reddy Ice said that as of 5 p.m. ET on March 2, holders had tendered 52.53% of the old notes, reaching the threshold for the minimum tender condition.

The exchange offer will expire at midnight ET on March 19.

Reddy Ice is a Dallas-based manufacturer and distributor of packaged ice.

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