MALVERN, Pa.--(BUSINESS WIRE)--LSF8 Bond Holdings, Ltd. (the “Offeror”) announced today the commencement of a private offer to purchase for cash any and all outstanding 10.500% / 12.000% Senior Secured PIK Toggle Notes due 2020 (the “PIK Notes”) and 10.500% Senior Secured Notes due 2020 (the “Non-PIK Notes” and, together with the PIK Notes, the “Notes”) of DFC Finance Corp. (“DFC Finance”). The Offeror is under common control with Lone Star Fund VIII (U.S.), L.P. and Lone Star Fund VIII (Bermuda) L.P., which indirectly own DFC Finance. The offer to purchase each series of Notes is referred to as the “Offer.” The Offer and the Consent Solicitation (as defined below) are being conducted by the Offeror upon the terms and subject to the conditions set forth in the offer to purchase and consent solicitation statement, dated October 20, 2017 (the “Offer to Purchase”).
In conjunction with the Offer, the Offeror is soliciting from the holders of the Notes (the “Holders”) consents (the “Consents”) to certain proposed amendments (the “Proposed Amendments”) to the applicable indenture for each series of Notes (together, the “Indentures”), and in each case certain related Notes Documents (as defined in the Indentures). The “Consent Solicitation” refers to the solicitation of the Consents. The Proposed Amendments, if adopted and effected, will be set forth in a supplemental indenture with respect to the applicable series of Notes and, as applicable, amendments to the Intercreditor Agreement (as defined in the Indentures), the US Collateral Agreement (as defined in the Indentures), and certain other applicable Notes Documents and other related agreements, which, unless withdrawn, will be executed and delivered promptly after receipt of the requisite Consents under the applicable Indenture. The Proposed Amendments, if adopted and effected, will eliminate or amend certain of the covenants in each of the Indentures and in the US Collateral Agreement governing the actions of Sterling Mid-Holdings Limited and its subsidiaries, certain reporting obligations, certain events of default and related provisions in the Indentures and the other Notes Documents, will terminate the Turnover Agreement, dated August 19, 2016 (the “Turnover Agreement”), by and between the Offeror and TMI Trust Company, in its capacity as trustee for and on behalf of the holders of the Turnover Debt (as defined in the Turnover Agreement) and the Contribution Commitment Letter, dated August 19, 2016, by and among Lone Star Fund VIII (U.S.) L.P., TMI Trust Company and Sterling Mid-Holdings Limited, will (subject to receiving the consent of the ABL Facility Collateral Agent (as defined in the Intercreditor Agreement)) modify the priority of the liens on the collateral securing the Notes to make those liens junior in all respects to the liens on the collateral securing the ABL Credit Facility Obligations (as defined in the Intercreditor Agreement) and any other Credit Facilities Obligations (as defined in the Indentures), will modify the release provisions of the Indentures to provide for the automatic release of the collateral agent’s lien on any assets constituting collateral upon the release of all liens on such assets securing any Credit Facilities Obligations (as defined in the Intercreditor Agreement) and any Other Pari Passu Obligations (as defined in the Indentures), and will modify the voting provisions of the Intercreditor Agreement and the US Collateral Agreement to permit Senior Secured Notes Obligations (as defined in the Intercreditor Agreement and the US Collateral Agreement, as applicable) held by affiliates of DFC Finance (other than Sterling Mid-Holdings Limited and its subsidiaries) to be voted with respect to any proposed action under such agreements requiring consent from holders of Senior Secured Notes Obligations.
The Offeror is offering to pay each Holder who has validly tendered, and not validly withdrawn, their Notes at or prior to 5:00 p.m., New York City time, on November 3, 2017, unless extended or earlier terminated by the Offeror in its sole discretion (such date and time, as the same may be extended or earlier terminated, the “Early Tender Date”), the total consideration for the applicable series of Notes set forth in the table below (the “Total Consideration”), which includes the applicable early participation premium for such series of Notes set forth in the table below (the “Early Participation Premium”). The Offeror is offering to pay each Holder who has validly tendered, and not validly withdrawn, their Notes at or prior to 12:00 midnight, New York City time, at the end of the day on November 20, 2017, unless extended or earlier terminated by the Offeror in its sole discretion (such date and time, as the same may be extended or earlier terminated, the “Expiration Date”) the tender consideration for the applicable series of Notes set forth in the table below (the “Tender Consideration”). The Offeror will only pay any Holder the applicable Total Consideration (including the applicable Early Participation Premium) or the applicable Tender Consideration, as applicable, if such Holder’s Notes are accepted for purchase pursuant to the terms in the Offer to Purchase. Holders of Non-PIK Notes accepted for purchase in the Offer will receive a cash amount equal to the accrued and unpaid interest on their Non-PIK Notes up to, but not including, the applicable settlement date. Holders of PIK Notes accepted for purchase in the Offer will receive cash in respect of the accrued and unpaid interest on their PIK Notes up to, but not including, the applicable settlement date equal to: (x) the amount of interest for such period that DFC Finance has elected to pay in cash, plus (y) in respect of interest for such period that DFC Finance has elected to pay in the form of additional PIK Notes, the Tender Consideration per $1.00 principal amount of such additional PIK Notes. Any Consents received in connection with the Consent Solicitation will be delivered by the Offeror to DFC Finance.
The Offer and the Consent Solicitation will expire at the Expiration Date. Holders who wish to receive the Total Consideration that is shown in the table below must validly tender, and not validly withdraw, their Notes and deliver Consents to the Proposed Amendments at or prior to the Early Tender Date. Holders who validly tender their Notes after the Early Tender Date and at or prior to the Expiration Date will receive only the Tender Consideration. All Holders who validly tender their Notes at or prior to the Expiration Date will be deemed to have delivered their Consents. Holders may not tender their Notes at or prior to the Expiration Date without delivering their Consents, and Holders may not deliver their Consents without tendering their Notes. Tendered Notes may be withdrawn and Consents may be revoked at any time at or prior to 5:00 p.m., New York City time, on November 3, 2017, unless extended or earlier terminated by the Offeror in its sole discretion, but not thereafter, except in certain limited circumstances where additional withdrawal rights are required by law.
| Title of Security | CUSIP Nos. |
Outstanding |
Tender |
Early |
Total |
|||||
| 10.500% / 12.000% Senior Secured PIK Toggle Notes due 2020 |
23320AAE2 |
$829,068,634 | $0.65 | $0.03 | $0.68 | |||||
| 10.500% Senior Secured Notes due 2020 |
23320A AA0 |
$54,961,000 | $620.00 | $30.00 | $650.00 |
| (1) | For each $1,000 principal amount of Non-PIK Notes or for each $1.00 principal amount of PIK Notes (including, in respect of accrued and unpaid interest on such PIK Notes up to, but not including, the settlement date, interest for such period that DFC Finance has elected to pay in the form of additional PIK Notes), in each case excluding accrued and unpaid interest thereon (other than as provided in the foregoing parenthetical), which interest will be paid in addition to the Tender Consideration or Total Consideration, as applicable. | |
| (2) | Payable only to Holders who validly tender (and do not validly withdraw) Notes prior to the Early Tender Date. | |
| (3) | The Early Participation Premium is included in the Total Consideration. | |
The Offer and the Consent Solicitation are subject to certain terms and conditions as described in the Offer to Purchase.
The complete terms of the Offer and the Consent Solicitation are described in the Offer to Purchase. The Offeror expressly reserves the right, in its sole and absolute discretion, subject to applicable law, to extend, terminate or otherwise amend the terms of the Offer or the Consent Solicitation.
Eaglehill Advisors LLC is acting as dealer manager and solicitation agent in connection with the Offer and the Consent Solicitation. Global Bondholder Services Corporation is acting as the information and tender agent for the Offer and the Consent Solicitation.
Requests for the Offer to Purchase may be directed to Global Bondholder Services Corporation at (212) 430-3774 (for brokers and banks) or (866) 807-2200 (for all others).
Questions or requests for assistance in relation to the Offer and the Consent Solicitation may be directed to Eaglehill Advisors LLC at (212) 405-1200.
This press release is not an offer to sell or a solicitation of an offer to buy any security. The Offer and Consent Solicitation are being made solely by the Offer to Purchase and only to such persons and in such jurisdictions as is permitted under applicable law.
This press release contains forward-looking statements. These forward-looking statements, which are usually accompanied by words such as “may,” “might,” “will,” “should,” “could,” “intends,” “estimates,” “forecast,” “predicts,” “potential,” “continue,” “believes,” “anticipates,” “plans,” “expects” and similar expressions, involve risks and uncertainties, and relate to, without limitation, statements about our market opportunities, anticipated improvements or challenges in operations, regulatory developments, our plans, earnings, cash flow and expense estimates, strategies and prospects, both business and financial. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made, and, except as otherwise required by law, we disclaim any obligation or undertaking to disseminate any update or revision to any forward-looking statement contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, whether or not the Offer and the Consent Solicitation are ultimately consummated, the satisfaction of the conditions described in the Offer to Purchase and market conditions.
About DFC Global Corp.
DFC Global Corp. and its affiliates are leading international non-bank providers of alternative financial services, principally unsecured short-term and longer term installment consumer loans, secured pawn loans, check cashing, gold buying, money transfers and reloadable prepaid debit cards, serving primarily unbanked and under-banked consumers through their approximately 1,200 current retail storefront locations and their multiple Internet platforms in nine countries across Europe and North America: the United Kingdom, Canada, the United States, Sweden, Finland, Poland, Spain and Romania. Our affiliated networks of retail locations in the United Kingdom and Canada are the largest of their kind by revenue in each of those countries. For more information, please visit DFC Global Corp.’s website at www.dfcglobalcorp.com.
DFC Global Corp. believes that its customers, many of whom receive income on an irregular basis or from multiple employers, choose to conduct their personal financial business with DFC Global Corp. rather than with banks or other financial institutions due to the range and convenience of services that it offers, the multiple ways in which they may conduct business with DFC Global Corp., and its high-quality customer service. DFC Global Corp.’s products and services, principally its unsecured short-term consumer loans, secured pawn loans and check cashing and gold buying services, provide customers with convenient access to cash for living expenses and other needs. In addition to these core offerings, DFC Global Corp. strives to offer its customers additional high-value ancillary services, including Western Union® money orders and money transfers, reloadable VISA® and MasterCard® prepaid debit cards and foreign currency exchange.