NEW YORK--(BUSINESS WIRE)--Aurelius Capital Master, Ltd., today issued the following statement:
AURELIUS CAPITAL MASTER, LTD.
C/O SS&C FUND SERVICES (CAYMAN) LTD.
45
MARKET STREET
GARDENIA COURT, CAMANA BAY
GRAND CAYMAN KY1-9003
CAYMAN
ISLANDS
November 1, 2017
NOTICE TO PROSPECTIVE HOLDERS OF WINDSTREAM’S NOTES DUE 2023 BEING ISSUED PURSUANT TO THE PENDING EXCHANGE OFFERS
Windstream Services, LLC (“Windstream”) is proposing to issue new 6-3/8% notes due 2023 (the “New Notes”) pursuant to various recently initiated exchange offers and a related consent solicitation. Aurelius Capital Master, Ltd. (“Aurelius”) is directing this notice to all prospective holders of the New Notes, whether acquired pursuant to the exchange offers or upon subsequent resale.1 Except as otherwise indicated, defined terms are used below with the meanings given to them in the indenture governing the 6-3/8% notes due 2023 as presently in effect (the “Indenture”).
Aurelius believes the proposed issuance of New Notes is prohibited by the Indenture. Without limiting the generality of the foregoing:
- Aurelius believes the issuance of the New Notes would breach Section 4.09 of the Indenture, which restricts Windstream’s incurrence of indebtedness. This belief takes into account Aurelius’s view that the 2015 transaction that is the subject of pending litigation gave rise to a large amount of Attributable Debt. Although a pending consent solicitation seeks to amend the Indenture to provide otherwise, Aurelius believes that consent solicitation is invalid, both because it is procedurally defective and because its consents are being sought in violation of Section 4.17 of the Indenture (which requires Windstream to offer equal consideration to all holders in a consent solicitation).
- The New Notes would be issued pursuant to a transaction that itself violates Section 4.17 of the Indenture.
Windstream presumably disagrees with Aurelius’s position.
Given its belief that the Indenture prohibits the proposed issuance of the New Notes, Aurelius has urged the indenture trustee not to authenticate them. If the indenture trustee authenticates the New Notes, Aurelius would expect to challenge their validity. In this event, a court may need to resolve any dispute concerning the validity of the New Notes. Aurelius is issuing this notice solely for the purpose of precluding any future holders of the New Notes (whether acquired in the exchange offers or through subsequent resale) from asserting a defense that they acquired the New Notes in good faith and without notice of any dispute as to the validity of New Notes or defect in their issuance.
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1 These observations are not comprehensive and are without prejudice to our rights. This communication does not constitute investment or legal advice. We do not hereby make any representation or undertake any duty. We encourage market participants to do their own homework and come to their own conclusions. Any errors herein are inadvertent, and we invite correction.