Automotores Gildemeister S.A. Announces Offer to Exchange our Existing Unsecured Notes for New Senior Secured Notes, New Preferred Stock and Warrants; Announces Commitment of More than 70% of Aggregate Principal Amount of Existing Unsecured Notes to Participate in Offer to Exchange

SANTIAGO, Chile, Dec. 17, 2015 /PRNewswire/ -- Automotores Gildemeister S.A. (the "Company") today announced the commencement of an exchange offer and consent solicitation (the "Offers and Solicitation") for any and all of its outstanding 8.250% Senior Unsecured Notes due 2021 (the "Existing 2021 Notes") and 6.750% Senior Unsecured Notes due 2023 (the "Existing 2023 Notes," and together with the Existing 2021 Notes, the "Existing Unsecured Notes") held by Eligible Holders (as defined below) for:

• up to US$425 million principal amount of 7.50% New Senior Secured Notes (the "New Senior Secured Notes"),
• up to 275,000 shares of preferred stock (the "New Preferred Stock") at a purchase price of US$1,000 per share (up to US$275 million in the aggregate),
• up to 700,000 warrants that, if 100% of the Existing Unsecured Notes are tendered in the Offers and Solicitation, will be exercisable for common shares equal to 40.0% of the Company's equity on a fully diluted basis (the "Warrants," and together with the New Senior Secured Notes and the New Preferred Stock, the "Exchange Securities"), and
• additional principal amount of New Senior Secured Notes equal to 60.7% of the accrued and unpaid interest on the Existing Unsecured Notes through and including the Settlement Date and additional number of shares of New Preferred Stock equal to 39.3% of the accrued and unpaid interest on the Existing Unsecured Notes through and including the Settlement Date divided by 1,000,

to be issued by the Company.  The Offers and Solicitation are being conducted upon the terms and subject to the conditions set forth in an Offering and Solicitation Memorandum, dated December 17, 2015 (the "Offering and Solicitation Memorandum"), and the related letter of transmittal. 

Eligible Holders who validly tender their Existing Unsecured Notes are offered in exchange for each US$1,000 principal amount of the Existing Unsecured Notes the following consideration (the "Base Exchange Consideration"):

• For the Existing 2021 Notes:
  • US$576 principal amount of New Senior Secured Notes;
  • 393 shares of New Preferred Stock;
  • one Warrant;
  • additional principal amount of New Senior Secured Notes equal to 60.7% of the accrued and unpaid interest on the tendered Existing 2021 Notes through and including the Settlement Date; and
  • additional number of shares of New Preferred Stock equal to 39.3% of the accrued and unpaid interest on the tendered Existing 2021 Notes through and including the Settlement Date divided by 1,000.
• For the Existing 2023 Notes:
  • US$576 principal amount of New Senior Secured Notes;
  • 393 shares of New Preferred Stock;
  • one Warrant;
  • additional principal amount of New Senior Secured Notes equal to 60.7% of the accrued and unpaid interest on the tendered Existing 2023 Notes through and including the Settlement Date; and
  • additional number of shares of New Preferred Stock equal to 39.3% of the accrued and unpaid interest on the tendered Existing 2023 Notes through and including the Settlement Date divided by 1,000.

The Company will also pay US$31 principal amount of New Senior Secured Notes for each US$1,000 principal amount of Existing Unsecured Notes validly tendered (the "Early Tender Consideration") to those holders who have tendered their Existing Unsecured Notes on or prior to January 6, 2016 (the "Early Tender Date") if at least 70% of the outstanding principal amount of each series of the Existing Unsecured Notes has been tendered on or prior to such date (the "Early Tender Condition").  The Base Exchange Consideration and the Early Tender Consideration are collectively referred to as the "Total Exchange Consideration." 

Holders of Existing Unsecured Notes representing more than 70% of the aggregate outstanding principal amount of Existing Unsecured Notes, including more than two-thirds of the principal amount of Existing 2021 Notes and more than two-thirds of the principal amount Existing 2023 Notes, have entered into a support agreement (the "Support Agreement"), with the Company and, subject to certain conditions, have committed to participate in the Offers and Solicitation.  Further information on the Support Agreement is contained in the Offering and Solicitation Memorandum under the heading "The Offers and Solicitation—Support Agreement."

The "Settlement Date" will occur after the expiration of the Offers and Solicitation, and will occur if all conditions precedent are satisfied or waived.

In addition, as part of the Offers and Solicitation, the Company is soliciting from the holders of the outstanding Existing Unsecured Notes consents (each a "Consent") to amend or waive provisions (the "Proposed Amendments") of the indentures governing the Existing Unsecured Notes (the "Solicitation"). The purpose of the Solicitation is to eliminate most restrictive covenants, some affirmative covenants, certain Events of Default and modify certain conditions on acceleration and rescissions of acceleration applicable to the Existing Unsecured Notes.

Beneficial owners of Existing Unsecured Notes should carefully read the Offering and Solicitation Memorandum regarding the relevant procedures and timing to tender their Existing Unsecured Notes. 

The Exchange Securities have not been and will not be registered under the Securities Act or any state securities laws. Therefore, unless so registered, the Exchange Securities may not be offered or sold except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws.  

The Offers and Solicitation are only made, and copies of the offering documents will only be made available, to a holder of the Existing Unsecured Notes who has certified its status as (1) a "qualified institutional buyer" as defined in Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), (2) a person who is not a "U.S. person" as defined under Regulation S under the Securities Act or (3) an "accredited investor" as defined in Rule 501 of Regulation D under the Securities Act (each, an "Eligible Holder").  Documents relating to the Offers and Solicitation will only be distributed to holders of Existing Unsecured Notes who complete and return a letter of eligibility confirming that they are within the category of Eligible Holders for the Offers and Solicitation.  Holders of Existing Unsecured Notes who wish to obtain a copy of the eligibility letter may contact Prime Clerk, the Exchange and Information Agent for the Offers and Solicitation, at (844) 205-4334 or, if outside the U.S. and Canada, at (917) 606-6438.

The Offers and Solicitation are subject to certain conditions, including the requirement that the Company receive valid tenders of at least 95% of the aggregate outstanding principal amount of the Existing Unsecured Notes (the "Minimum Tender Condition").

The Offers and Solicitation will expire at 5:00 p.m., New York City time, on January 20, 2016, unless extended by the Company (the "Expiration Date"). If the Early Tender Condition is not satisfied on the Early Tender Date, holders who tendered their Existing Unsecured Notes on or prior to the Early Tender Date will have the right to withdraw their Existing Unsecured Notes from the Offers and Solicitation following the Early Tender Date until the Expiration Date.  Furthermore, in the event the Support Agreement is terminated prior to the consummation of the Offers and Solicitation, holders who tendered their Existing Unsecured Notes (including holders who tendered their Existing Unsecured Notes on or prior to the Early Tender Date) will have the right to withdraw their Existing Unsecured Notes from the Offers and Solicitation following the termination of the Support Agreement until the Expiration Date.  We will also grant withdrawal rights to the extent required by applicable law.  

THIS PRESS RELEASE IS NOT AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITY.  THE OFFERS AND SOLICITATION ARE BEING MADE SOLELY BY THE OFFERING AND SOLICITATION MEMORANDUM AND RELATED LETTER OF TRANSMITTAL THAT MAY BE OBTAINED FROM THE EXCHANGE AND INFORMATION AGENT AND ONLY TO SUCH PERSONS AND IN SUCH JURISDICTIONS AS IS PERMITTED UNDER APPLICABLE LAW.  ANY PUBLIC OFFERING OF SECURITIES TO BE MADE IN THE UNITED STATES WILL BE MADE BY MEANS OF A PROSPECTUS THAT MAY BE OBTAINED FROM THE COMPANY OR THE SELLING SECURITY HOLDER THAT WILL CONTAIN DETAILED INFORMATION ABOUT THE COMPANY AND MANAGEMENT, AS WELL AS FINANCIAL STATEMENTS. 

The Exchange Securities will not be registered under the Ley de Mercado de Valores No. 18,045 (the "Securities Market Law"), as amended, of Chile with the Superintendencia de Valores y Seguros (the Chilean Securities and Insurance Commission or "SVS"), and, accordingly, may not be offered or sold to persons in Chile except in circumstances that do not constitute a public offering under Chilean law.

Los valores que se emitan no seran registrados en la Superintendencia de Valores y Seguros de conformidad a la ley de Mercado de Valores No.18,045, por lo que de acuerdo a ello, no podran ser ofrecidos a personas en Chile excepto en circunstancias que no constituyan una oferta publica de valores de acuerdo a ley Chilena.

About Automotores Gildemeister

Automotores Gildemeister is a vehicle importer and distributor primarily in Chile and Peru.  Since 1986, the Company has been the sole distributor of Hyundai passenger and light commercial vehicles in Chile and since 2002, the sole distributor of Hyundai passenger, light commercial and heavy commercial vehicles in Peru.

Exchange and Information Agent

Prime Clerk, LLC 
830 Third Avenue, 3^rd Floor
New York, NY 10022
c/o Automotores Gildemeister Exchange Offer
[email protected] 
(844) 205-4334

SOURCE Automotores Gildemeister S.A.