By Susanna Moon
Chicago, May 12 – Affinion Group Holdings, Inc. fleshed out the terms of the $532,616,637 of 12½%/15½% pay-in-kind senior notes due 2022 issued in the exchange offer and placement that ended May 5.
The details included the exact maturity date of Nov. 10, 2022 and the call and put option terms, according to an 8-K filing with the Securities and Exchange Commission.
Affinion had offered to swap out its $16,111,533 of 13¾%/14½% senior secured PIK/toggle notes due 2018, Affinion Group, Inc.’s $475 million of 7 7/8% senior notes due 2018 and Affinion Investments, LLC’s $22,609,200 of 13½% senior subordinated notes due 2018.
Noteholders tendered for exchange $4,567,624, or about 28.4%, of the 13¾%/14½% PIK notes; $269,718,000, or about 56.8%, of the 7 7/8% notes; and $12,448,280, or about 55.1%, of 13½% notes.
The exchange offers and consent solicitations opened on April 3.
For each series of notes, holders were offered either (1) senior notes due 2022 issued by Affinion Group plus new warrants to purchase shares of Affinion Holdings or (2) cash.
For each $1,000 principal amount of notes tendered, holders could elect to receive either (1) $1,000 principal amount of new 12½%/15½% PIK notes due 2022 and warrants to purchase 3.37 shares or (2) cash. The cash amount was $930 for the 7 7/8% notes, $700 for the PIK toggle notes and $880 for the 13½% notes.
For the first 18 months, Affinion Group may elect to pay interest on the new notes (1) entirely in cash at a rate per year of 12½% or (2) entirely in kind at a rate per year of 14%, provided that interest for the first interest period beginning on the settlement date will be payable entirely in kind.
After 18 months, Affinion Group may elect, or may be required, to pay interest on the new notes (i) entirely in cash at a rate per year of 12½%, (ii) as a combination of cash at a rate per year of 6½% and PIK interest at a rate per year of 7½% or (iii) as PIK interest at a rate per year of (x) 14¾% for any interest payment period ending on or prior to the date that is the 30-month anniversary of the settlement date or (y) 15½% for any interest payment period ending after the date that is the 30-month anniversary of the settlement date.
The $532,616,637 principal amount of new notes includes $295,338,212 issued in the exchange and $237,278,425 issued under Regulation D to investors under a purchase agreement.
Affinion is a Stamford, Conn., provider of marketing loyalty products.
New notes
| Issuer: | Affinion Group, Inc.
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| Issue: | 12½%/15½% PIK notes
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| Amount: | $532.6 million
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| Maturity: | Nov. 10, 2022
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| Call option: | At par plus make-whole premium of 50 basis points over Treasuries until May 10, 2020, at 106.25% in 2020, at 103.125% in 2021 and at par beginning in 2022; if there is a change of control or using proceeds of asset sales, at 116% until Nov. 9, 2017, at 108% from Nov. 10, 2017 to May 9, 2018, at 102% from May 10, 2018 to May 9, 2019, at 101% from May 10, 2019 to May 9, 2022 and at par beginning May 10, 2022
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| Put option: | If there is a change of control, at 116% until Nov. 9, 2017, at 108% from Nov. 10, 2017 to May 9, 2018, at 102% from May 10, 2018 to May 9, 2019, at 101% from May 10, 2019 to May 9, 2022 and at par beginning May 10, 2022
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