CAMBRIDGE, ON, April 20, 2015 /PRNewswire/ - Kissner Milling Company Limited (the "Issuer") announced today that it has commenced a solicitation (the "Consent Solicitation") of consents (the "Consents") upon the terms and subject to the conditions set forth in a consent solicitation statement (the "Consent Solicitation Statement") and the accompanying consent letter (the "Consent Letter") sent to the holders of record (the "Holders") at 5:00 p.m., New York City time, on April 17, 2015 of their outstanding 7.250% Senior Secured Notes due 2019 (CUSIP NOS. 49835DAA7 and C49518AA8) (the "Notes"), to amend certain provisions of the Indenture governing the Notes, dated as of May 30, 2014 (the "Indenture"), among the Issuer, the guarantors party thereto, Wells Fargo Bank, National Association, as trustee (the "Trustee") and Wells Fargo Bank, National Association, as collateral agent.
The Consent Solicitation is being conducted in contemplation of the proposed acquisition by Krystal Acquisition Company Inc., an entity controlled by an affiliate of Metalmark Capital Partners Cayman II, L.P., MCP II (Outbound), L.P., MCP TE II (Outbound), L.P., Metalmark Capital Partners II Co-Investment, L.P., MCP (Silo) II AIF Offshore, L.P., Metalmark Capital Partners II Executive Fund, L.P. and Silvertree-KMC II, LP (collectively, the "Investors"), of all of the outstanding ownership interests of the Issuer and of Kissner Group Inc. other than certain outstanding ownership interests being retained by certain existing investors (together with certain related transactions, the "Acquisition"). However, receipt of the Requisite Consents (as defined herein) is not necessary to complete the Acquisition. Therefore, the Acquisition may be consummated regardless of whether or not the Requisite Consents are received.
Under the Indenture, the completion of the Acquisition would constitute a Change of Control. The anticipated Change of Control would require the Issuer to make a Change of Control Offer, in the manner contemplated by such Indenture, to each Holder to purchase all or any part of such Holder's Notes at a purchase price equal to 101% of the aggregate principal amount of Notes purchased, plus accrued and unpaid interest, if any, to the date of purchase. The Issuer is seeking Consents from the Holders to amend the Indenture such that the Acquisition would not constitute a Change of Control and that, as a result, a Change of Control Offer would not be required following completion of the Acquisition, and Holders would not be entitled to receive any Change of Control Payment in connection with the Acquisition. "Change of Control," "Change of Control Offer," and "Change of Control Payment" as used herein have the meaning ascribed to such terms in the Indenture. In addition, the Issuer is seeking Consents from Holders to add to, amend, supplement or change certain defined terms and other provisions in the Indenture related to the foregoing, including to treat certain payments to the Investors or their affiliates following the Acquisition in a similar manner to payments to certain of the Issuer's current shareholders. Such amendments, as described in the Consent Solicitation Statement are referred to herein as the "Proposed Amendments."
The Consents of the Holders of at least a majority in principal amount of the outstanding Notes (the "Requisite Consents") are required pursuant to the terms of the Indenture for the Proposed Amendments to be approved and binding on the Holders and any subsequent holder of the Notes.
In the event that the conditions set forth in the Consent Solicitation Statement, including the receipt of the Requisite Consents and the Acquisition Condition (as defined herein), are satisfied or waived by the Issuer (to the extent such Conditions may be waived pursuant to the terms of the Consent Solicitation Statement) and the Consent Solicitation is not terminated or withdrawn, the Issuer will pay to the Holders of outstanding Notes who delivered valid Consents prior to the Expiration Date (as defined herein), and who have not validly revoked such Consents prior to the Effective Time (as defined herein), a cash payment of $2.50 per $1,000 principal amount of Notes for which Consents have been delivered (and not properly revoked) by such Holder (the "Consent Fee").
Provided the Issuer receives the Requisite Consents and the Consent Solicitation is not terminated or withdrawn, the Proposed Amendments will be effected by a supplemental indenture (the "Supplemental Indenture"). Promptly following the receipt of the Requisite Consents and the occurrence of the Expiration Date, the Issuer intends to execute the Supplemental Indenture containing the Proposed Amendments, at which time (i) the Issuer will be deemed to have accepted the Consents and (ii) the Supplemental Indenture will be effective (the "Effective Time"). While the Issuer expects to execute the Supplemental Indenture promptly after the receipt of the Requisite Consents and the occurrence of the Expiration Date, the Proposed Amendments will not become operative until the effective date of, and contemporaneously with, the consummation of the Acquisition. The Supplemental Indenture will provide that if the Consent Fee has not been paid on or prior to the earlier of (i) the date that is 5 business days after the date upon which all the conditions described in the Consent Solicitation Statement, including the receipt of the Requisite Consents and the Acquisition Condition, are satisfied or waived by the Issuer, and the Consent Solicitation is not terminated or withdrawn, and (ii) October 14, 2015, the Indenture will revert to the form in effect immediately prior to the Effective Time, with such reversion being retroactive as if the Proposed Amendments had never become operative.
The Consent Solicitation will expire at 5:00 p.m., New York City time, on April 24, 2015, unless extended or earlier terminated (such time on such date, as the same may be extended or earlier terminated, the "Expiration Date"). The Issuer may abandon or terminate the Consent Solicitation for any reason, in which case no Consent Fee shall be payable. The Consent Solicitation is subject to certain customary conditions, including, among other things, the receipt of the Requisite Consents prior to the Expiration Date (which consents have not been properly revoked prior to the effectuation of the Supplemental Indenture) and the consummation of the Acquisition as described in the Consent Solicitation Statement (the "Acquisition Condition"). The Issuer reserves the right to waive certain of the conditions in its sole discretion at any time, including after the Expiration Date, without giving the Holders withdrawal rights, as discussed in the Consent Solicitation Statement. Holders of Notes for which no Consent is delivered will not receive the Consent Fee, even though the Proposed Amendments, once operative, will bind all Holders of the Notes and their transferees.
The Issuer has engaged Barclays Capital Inc. to act as the exclusive Solicitation Agent and D.F. King & Co., Inc. to act as Information Agent and Tabulation Agent in connection with the Consent Solicitation. Questions regarding the Consent Solicitation may be directed to Barclays Capital Inc. at (800) 438-3242 (toll-free) or (212) 528-7581 (collect). Requests for documents relating to the Consent Solicitation may be directed to D.F. King & Co., Inc. at (866) 828-0221 (toll-free) or collect at (212) 269-5550.
This press release is for informational purposes only and the Consent Solicitation is only being made pursuant to the terms of the Consent Solicitation Statement and related Consent Letter. The Consent Solicitation is not being made to, and Consents are not being solicited from, Holders of Notes in any jurisdiction in which it is unlawful to make such Consent Solicitation or grant such Consent. With respect to the Consent Solicitation, none of the Issuer, the Trustee, the Solicitation Agent, the Information Agent or the Tabulation Agent makes any recommendation as to whether or not Holders should deliver Consents. Each Holder must make its own decision as to whether or not to deliver Consents.
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities.
About Kissner Milling Company Limited
Headquartered in Cambridge, Ontario, Kissner is a leading producer and distributor of bulk rock salt and packaged specialty deicing products across North America. Kissner owns and operates a rock salt mine located in Detroit, Michigan, which began operations over 100 years ago and today is one of the most efficient and safest rock salt mines in North America. With a vertically-integrated supply chain for packaged deicing products, Kissner is highly differentiated in its industry and one of the most cost-competitive producers and distributors of bulk rock salt and other packaged deicing products, across its markets.
Special Note Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the federal securities laws. All statements contained in this press release other than statements of historical fact are forward-looking statements. Forward-looking statements address activities, events or developments that we expect or anticipate will or may occur in the future, including references to future goals or intentions. These statements can be identified by the use of forward-looking terminology, including "may," "expect," "anticipate," "will" or similar words. Whether actual results and developments in the future will conform to our expectations is subject to numerous risks and uncertainties, many of which are beyond our control. Therefore, actual outcomes and results could materially differ from what is expressed or implied in these statements.
SOURCE Kissner Milling Company Limited