Carrols subsidiary obtains needed consents for 9% subordinated notes

By Jennifer Chiou

New York, Aug. 4 - Carrols Restaurant Group, Inc. subsidiary Carrols Corp. announced the receipt of the necessary consents after receiving early tenders for $118,366,000, or 71.74%, of its $165 million of 9% senior subordinated notes due 2013.

The offer and consent solicitation began on July 22.

As already reported, the total payment will be $1,003.75 for each $1,000 principal amount of notes tendered by the consent deadline of 5 p.m. ET on Aug. 4, which includes a consent payment of $30.00 per $1,000 principal amount.

Holders who tender their notes after the consent date but by the expiration of the offer at midnight ET on Aug. 18 will receive $973.75 per $1,000 principal amount.

The company also will pay accrued interest to but not including the payment date.

Tendered notes may not be withdrawn after the consent deadline.

Carrols is seeking consents to amend the notes to "eliminate a significant portion of the restrictive covenants in the indenture and eliminate certain events of default," according to a prior company press release.

Adoption of the proposed amendments required consents from holders of at least a majority of the outstanding principal amount of notes. The amendments will become operative when those notes have been accepted for payment.

Holders who tender their notes must consent to the proposed amendments, and holders may not deliver consents without tendering their notes.

The tender offer and consent solicitation are conditioned on receiving tenders of at least a majority of outstanding notes and the execution of a supplemental indenture. There is also a financing condition that requires the issue of at least $200 million of senior secured second-lien notes and a new first-lien revolving credit facility by Fiesta Restaurant Group, Inc., a wholly owned subsidiary of Carrols Corp., as well as a new senior secured credit facility of Carrols LLC, a wholly owned subsidiary of Carrols Corp.

Wells Fargo Securities (866 309-6316 or collect 704 715-8341) is the dealer manager and solicitation agent. D.F. King & Co. (800 431-9645 or for banks and brokers 212 269-5550) is the depositary and information agent.

Carrols operates three restaurant brands in the quick-casual and quick-service restaurant segments and is based in Syracuse, N.Y. It is the parent company of Carrols Corp.

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