LOS ANGELES, Dec. 15, 2020 /PRNewswire/ -- 99 Cents Only Stores LLC (the "Company") today announced that 99 Escrow Issuer, Inc. (the "Escrow Issuer") intends to offer, subject to market conditions and other considerations, $325 million in aggregate principal amount of senior secured notes due 2025 (the "Notes") to "qualified institutional buyers" (as defined in Rule 144A under the Securities Act of 1933, as amended (the "Securities Act")) in a private transaction (the "Notes Offering") in reliance upon the exemption from the registration requirements of the Securities Act and certain non-U.S. persons outside the United States in accordance with Rule 902 under the Securities Act. The Escrow Issuer was formed solely for the purpose of issuing the Notes and, following the escrow release, will be merged with and into the Company and the Company will assume the obligations of the Escrow Issuer under the Notes and the related indenture. On and after the escrow release, the Notes will be guaranteed on a senior secured basis by the Company's immediate parent company, Number Holdings, Inc. ("Parent") and each of the Company's existing and future domestic subsidiaries that guarantees the Company's obligations under its first lien asset-based revolving credit facility.
The Notes are being offered in connection with an anticipated preferred equity financing ("Preferred Equity Financing"). The Preferred Equity Financing is expected to be consummated following the closing of the offering of the Notes. Completion of the Preferred Equity Financing is a condition to the escrow release.
The Company intends to use the net proceeds of this offering, together with the proceeds of the Preferred Equity Financing, to repay in full the indebtedness outstanding under its existing first lien term loan facility, fund the redemption in full of its outstanding 13% Cash/PIK Notes due 2022, pay down a portion of the outstanding borrowings under its first lien asset-based revolving credit facility, and pay certain related fees and expenses. Any remaining proceeds will be used for general corporate purposes, which may include the repayment of debt.
The Notes will not be registered under the Securities Act of 1933 or the securities laws of any state and may not be offered or sold in the United States absent registration or an exemption from the registration requirements of the Securities Act and applicable state securities laws. This press release does not constitute an offer to sell or the solicitation of an offer to buy any security, nor shall there be any sale of the Notes or any other security of the Company, in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.
About 99 Cents Only Stores
Founded in 1982, 99 Cents Only Stores LLC is the leading operator of extreme value stores in California and the Southwestern United States. The Company currently operates 385 stores located in California, Texas, Arizona and Nevada. 99 Cents Only Stores LLC offers a broad assortment of name brand and other attractively priced merchandise and compelling seasonal product offerings. For more information, visit www.99only.com.
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The Company has included statements in this report that constitute "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act, as amended, and Section 27A of the Securities Act of 1933, as amended. As a general matter, forward-looking statements are those focused on future or anticipated events or trends, expectations and beliefs including, among other things, the Company's expectations with respect to the offering described herein. Such statements are intended to be identified by using words such as "believe," "expect," "intend," "estimate," "anticipate," "will," "project," "plan" and similar expressions in connection with any discussion of future operating or financial performance. Any forward-looking statements are and will be based upon the Company's then-current expectations, estimates and assumptions regarding future events and are applicable only as of the dates of such statements. Readers are cautioned not to put undue reliance on such forward-looking statements. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those projected in this release for reasons, among others, including general market conditions and those reasons discussed in the Offering Memorandum, in the reports and other documents the Company provides to its noteholders from time to time, and in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors" sections contained in the Company's annual report for the fiscal year ended January 31, 2020 and its quarterly report for the quarter ended October 30, 2020. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
SOURCE 99 Cents Only Stores