Inland extends offer to swap new notes, cash for 4.625% convertibles

By Susanna Moon

Chicago, July 29 - Inland Real Estate Corp. said it extended the exchange offer to 5 p.m. ET on Aug. 5 for its $125 million outstanding principal amount of 4.625% convertible senior notes due 2026.

The offer and consent solicitation had been scheduled to expire at 5 p.m. ET on July 28.

As of July 28, holders had tendered $45.6 million principal amount, or 36.5%, of the 4.625% convertibles.

Holders may elect to receive $1,000 principal amount of a new series of 5% convertible senior notes due 2029, a cash payment of $1,000 subject to a $15 million limit or a combination of cash and notes.

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

The company previously said it began the offer to improve its financial flexibility by extending the repurchase and maturity dates of current bonds and by reducing debt.

As already noted, the company also is soliciting consents to amend the default provisions in the notes to mirror those contained in the new notes.

Inland said the proposed amendment will provide it with additional flexibility to negotiate with its lenders and the lenders of its subsidiary debt.

Holder who tender their notes will be deemed to have delivered consents.

The company announced plans for the exchange offer on May 24.

It said at the time that it would seek consents to increase the threshold for accelerating debt upon a default on any other debt to $100 million from $20 million.

The new notes will be callable beginning Nov. 21, 2014 and putable on Nov. 15, 2014, Nov. 15, 2016, Nov. 15, 2019 and Nov. 15, 2024.

In comparison, the existing notes are callable beginning Nov. 21, 2011 and putable on Nov. 15, 2011, Nov. 15, 2013, Nov. 15, 2016 and Nov. 15, 2021.

The company previously said it planned to fund the cash payment with cash on hand or with funds drawn under its credit facility.

Macquarie Capital (USA) Inc. (212 231-6594) is the dealer manager, and Global Bondholder Services Corp. (212 430-3774 or 866 387-1500) is the exchange agent and information agent.

Inland Real Estate is a real estate investment trust with a focus on open-air neighborhood, community, power and lifestyle shopping centers and single-tenant retail properties located primarily in upper Midwest markets.

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