Business News
RockTenn Announces Senior Notes Offering
Friday 15. May 2009 - RockTenn announced today that, in connection with its cash tender offer for up to $100 million aggregate principal amount of its 8.20% senior secured notes due August 15, 2011, it intends to offer, pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended, an unregistered add-on offering of $100 million aggregate principal amount of 9 1/4% Senior Notes due March 15, 2016.
The notes will be guaranteed on a senior unsecured basis by all of RockTenns domestic subsidiaries (the “Guarantors”) that guarantee obligations under its amended and restated credit facility. The notes will rank equally in right of payment with all of RockTenns existing and future unsecured senior debt and senior in right of payment to all of RockTenns existing and future subordinated debt. The notes will be effectively subordinated to any of RockTenns and the Guarantors existing and future secured debt to the extent of the value of the assets securing such debt including all borrowings under the amended and restated credit facility. The notes will be structurally subordinated to all existing and future liabilities of RockTenns subsidiaries that do not issue guarantees of the notes. The notes will be treated as a single series with the existing 9 1/4% Senior Notes due 2016, except that (i) the notes will be subject to a separate registration rights agreement, (ii) cash interest will accrue on the notes from and including March 15, 2009, the most recent interest payment date for the existing notes, (iii) until the notes are registered or have otherwise become freely tradeable and the restrictive legend has been removed therefrom, the notes will have a separate CUSIP number from that of the existing notes and will not be fungible with the existing notes and (iv) the first payment of cash interest following the issue date of the notes will be September 15, 2009. The notes and the existing notes will vote as one class under the indenture governing the notes.
The net proceeds from the offering, together, if needed, with cash on hand and borrowings under RockTenns amended and restated credit facility, will be used to purchase a portion of RockTenns 8.20% senior secured notes due August 15, 2011, to pay any accrued and unpaid interest from the last interest payment date applicable to the August 2011 notes tendered, to pay all fees and expenses incurred in connection with the offering and the cash tender offer and, to the extent of any remaining proceeds, for general corporate purposes.
The notes have not been registered under the Securities Act of 1933, as amended, or the securities laws of any state and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements under the Securities Act and any applicable state securities laws.