International Coal Group Announces Tender Offer and Consent Solicitation for Any and All of Its 10.25% Senior Notes Due 2014

SCOTT DEPOT, W.Va., March 8 /PRNewswire-FirstCall/ -- International Coal Group, Inc. (NYSE: ICO) (the "Company") announced today that it has commenced a cash tender offer for any and all of the $175.0 million aggregate principal amount of its outstanding 10.25% Senior Notes due 2014 (CUSIP No. 45928HAA4) (the "Senior Notes").  The Company also announced a concurrent consent solicitation for proposed amendments to the indenture under which the Senior Notes were issued.  The tender offer and the consent solicitation are being made on the terms and subject to the conditions set forth in the Offer to Purchase and Consent Solicitation Statement dated March 8, 2010 (the "Offer to Purchase") and the related Letter of Transmittal and Consent.  Holders that tender their Senior Notes pursuant to the tender offer will be deemed to have consented to the proposed amendments to the indenture.  

The tender offer will expire at midnight, New York City time, on April 2, 2010, unless extended or earlier terminated by the Company (such date and time, the "Expiration Time").  In order to be eligible to receive the total consideration (as described below) for tendered Senior Notes, holders must validly tender and not validly withdraw their Senior Notes and validly deliver and not validly revoke their consent at or prior to 5:00 p.m., New York City time, on March 19, 2010, unless extended or earlier terminated by the Company (such date and time, the "Consent Payment Deadline").

The tender offer and consent solicitation are subject to the satisfaction or waiver of certain conditions as described in the Offer to Purchase, including (1) the Company raising a minimum of $200.0 million in aggregate gross proceeds, exclusive of discounts, through a concurrent offering of senior secured second-priority notes at or prior to the Expiration Time and (2) the valid delivery of consents to the proposed amendments in respect of a majority of the outstanding principal amount of the Senior Notes (excluding the $11.0 million aggregate principal amount of Senior Notes owned by certain of the Company's affiliates).

The total consideration for each $1,000 principal amount of Senior Notes validly tendered and not validly withdrawn at or prior to the Consent Payment Deadline is $1,072.50.  The total consideration of $1,072.50 includes a consent payment of $30.00 per $1,000 principal amount of Senior Notes.  Holders that validly tender and do not validly withdraw Senior Notes and validly deliver and do not validly revoke consents to the proposed amendments at or prior to the Consent Payment Deadline will be eligible to receive the total consideration.  Holders that validly tender Senior Notes after the Consent Payment Deadline but at or prior to the Expiration Time will be eligible to receive the tender offer consideration.  The tender offer consideration of $1,042.50 is equal to the total consideration less the consent payment.

Senior Notes validly tendered prior to the Consent Payment Deadline may be validly withdrawn and the related consents may be revoked at any time at or prior to the Consent Payment Deadline.  Tendered Senior Notes may not be withdrawn and delivered consents may not be revoked after the Consent Payment Deadline, except under certain limited circumstances as described in the Offer to Purchase.

In addition to the total consideration or tender offer consideration, as applicable, holders that validly tender and do not validly withdraw their Senior Notes at or prior to the Expiration Time will also be paid accrued and unpaid interest to, but not including, the applicable payment date on such Senior Notes that are accepted for purchase by the Company.

The proposed amendments to the indenture governing the Senior Notes would eliminate substantially all of the restrictive covenants and eliminate or modify certain events of default contained in the indenture and the Senior Notes.  Holders may not deliver consents to the proposed amendments without validly tendering the related Senior Notes in the tender offer and may not revoke their consents without withdrawing the previously tendered Senior Notes to which they relate.

The Company has engaged UBS Investment Bank and Morgan Stanley as Dealer Managers for the tender offer and Solicitation Agents for the consent solicitation.  Persons with questions regarding the tender offer and consent solicitation should contact UBS Investment Bank toll-free at (888) 719-4210 or collect at (203) 719-4210 or Morgan Stanley toll-free at (800) 624-1808 or collect at (212) 761-5384.  Requests for documents should be directed to D. F. King & Co., Inc., the Information Agent and Depositary for the tender offer and consent solicitation, at (212) 269-5550 (banks and brokers) or (800) 431-9633 (all others).

This press release is for information purposes only and is not an offer to purchase, a solicitation of acceptance of the offer to purchase or a solicitation of a consent with respect to any of the Senior Notes.  The tender offer and consent solicitation are being made pursuant to the tender offer and consent solicitation documents, including the Offer to Purchase, that the Company is distributing to holders of Senior Notes.  The tender offer and consent solicitation are not being made to holders of Senior Notes in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction.

This press release contains "forward-looking statements" within the meaning of federal securities law.  You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company's control.  Such risks and uncertainties include, but are not limited to, the completion of the tender offer and consent solicitation and the receipt of consents sufficient to approve the proposed amendments to the indenture governing the Senior Notes.

ICG is a leading producer of coal in Northern and Central Appalachia and the Illinois Basin.  The Company has 13 active mining complexes, of which 12 are located in Northern and Central Appalachia, and one in Central Illinois.  ICG's mining operations and reserves are strategically located to serve utility, metallurgical and industrial customers throughout the eastern United States.

SOURCE International Coal Group, Inc.