Michael Foods, Inc. and M-Foods Holdings, Inc. Announce Tender Offers and Consent Solicitations for 8% Senior Subordinated Notes Due 2013 and 9 3/4% Senior Discount Notes Due 2013

MINNETONKA, Minn., June 7 /PRNewswire/ -- Michael Foods, Inc. ("MFI") and M-Foods Holdings, Inc. ("Holdings") announced today that MFI has commenced a cash tender offer for any and all of the $150,000,000 aggregate principal amount of its outstanding 8% Senior Subordinated Notes due 2013 (CUSIP Nos. 594079AC9 and U59325AA5, ISIN Nos. US594079AC95 and USU59325AA54) (the "MFI Notes") and Holdings has commenced a cash tender offer for any and all of the $154,061,000 aggregate principal amount at maturity of its outstanding 9 3/4% Senior Discount Notes due 2013 (CUSIP Nos. 552741AA8 and U59246AA3, ISIN Nos. US552741AA85 and USU59246AA35) (the "Holdings Notes" and together with the MFI Notes, the "Notes").

MFI and Holdings also announced concurrent consent solicitations for proposed amendments to the indentures under which the related Notes were issued.  The tender offers and the consent solicitations are being made on the terms and subject to the conditions set forth in the Offer to Purchase and Consent Solicitation Statement, dated June 7, 2010 (the "Offer to Purchase"), and the related Letter of Transmittal.  Holders that tender their Notes in a tender offer will be deemed to have consented to the proposed amendments to the applicable indenture governing such Notes.

Each tender offer will expire at midnight, New York City time, on Friday, July 2, 2010, unless extended or earlier terminated (such date and time with respect to a tender offer, as the same may be extended for such tender offer, the "Expiration Time").  In order to be eligible to receive the applicable total consideration (as described below) for tendered Notes, holders must validly tender and not validly withdraw their Notes at or prior to 5:00 p.m., New York City time, on Friday, June 18, 2010, unless extended (such date and time with respect to a consent solicitation, the "Consent Deadline").

The tender offers and consent solicitations are subject to the satisfaction or waiver of certain conditions as described in the Offer to Purchase, including (1) the consummation of Holdings' previously announced merger, (2) the receipt by Holdings of proceeds from one or more financings generating net proceeds sufficient to repurchase the Notes tendered, including the payment of all premiums, if any, consent payments, accrued interest and costs and expenses incurred in connection therewith and (3) the receipt by MFI and Holdings of the consents of holders holding at least a majority of the aggregate principal amount outstanding or aggregate principal amount at maturity outstanding, of the applicable series of Notes, in each case as described in more detail in the Offer to Purchase.

The total consideration for each $1,000 principal amount of MFI Notes and each $1,000 principal amount at maturity of Holdings Notes validly tendered and not validly withdrawn and accepted for purchase pursuant to the applicable tender offer will be an amount equal to $1,029.17 and $1,035.00, respectively, payable in cash to holders that validly tender their Notes at or prior to the applicable Consent Deadline, plus accrued interest.

The applicable total consideration set forth above includes a consent payment of $15.00 per $1,000 principal amount of MFI Notes and $15.00 per $1,000 principal amount at maturity of Holdings Notes, as in each case, payable only to holders that validly tender and do not validly withdraw their Notes and validly deliver and do not validly revoke their consents at or prior to the applicable Consent Deadline.  Holders of Notes validly tendered after the applicable Consent Deadline will not receive a consent payment.  

Notes validly tendered prior to 5:00 p.m., New York City time, on Friday, June 18, 2010 (the "Withdrawal Date") may be validly withdrawn and the related consents may be validly revoked at any time at or prior to the Withdrawal Date.  Tendered Notes and delivered consents may not be validly withdrawn or validly revoked after the applicable Withdrawal Date, except under certain limited circumstances as described in the Offer to Purchase.

The proposed amendments to the indentures governing the Notes would eliminate substantially all of the restrictive covenants, certain affirmative covenants, certain events of default, certain conditions to legal defeasance or covenant defeasance and substantially all of the restrictions on the ability of MFI or Holdings, as applicable, to merge, consolidate or sell all or substantially all of their properties or assets contained in each Indenture and the related Notes, and would waive any and all defaults resulting from the consummation of the merger or the financing as described in the Offer to Purchase.  Holders may not deliver consents to the proposed amendments without validly tendering the related Notes in the applicable tender offer and may not revoke their consents without withdrawing the previously tendered Notes to which they relate.

MFI and Holdings have engaged Goldman, Sachs & Co. and BofA Merrill Lynch as Dealer Managers and Solicitation Agents for the tender offers and consent solicitations.  Persons with questions regarding the tender offers or the consent solicitations should contact Goldman, Sachs & Co. at (800) 828-3182 or collect at (212) 902-5183 or BofA Merrill Lynch at (888) 292-0070 or collect at (646) 855-3401.  Requests for documents should be directed to Global Bondholder Services Corporation, the Information Agent and Depositary for the tender offers and consent solicitations, at (212) 430-3774 (for banks and brokers) or (866) 294-2200 (for noteholders).

This press release is for information purposes only and is not an offer to purchase, a solicitation of an offer to purchase or a solicitation of a consent with respect to any of the Notes.  The tender offers and consent solicitations are being made pursuant to the tender offer and consent solicitation documents, including the Offer to Purchase that MFI and Holdings are distributing to holders of the Notes.  The tender offers and consent solicitations are not being made to holders of 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.

About Michael Foods, Inc.

MFI, based in Minnetonka, MN, is the largest producer of egg products in North America. Its egg products include Papetti's® precooked, frozen, liquid, hardcooked and dried products, Abbotsford Farms cage-free and organic egg products, and All Whites® and Better 'n Eggs®, both sold at retail. MFI also owns the Simply Potatoes® line of refrigerated potato products, as well as Crystal Farms® branded cheese and refrigerated products.  

Forward-Looking Statements

Certain items in this release may be forward-looking statements, including statements regarding the payment of total consideration and tender offer consideration, the elimination of restrictive covenants, certain affirmative covenants and certain conditions to legal defeasance or covenant defeasance contained in the indentures governing the Notes and the waiver of certain defaults thereunder.  All forward-looking statements in this release represent the judgment of MFI and Holdings only as of the date of this release.  Such forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, completion of the tender offers and the receipt of consents sufficient to approve the proposed amendments to the indentures governing the Notes.  Therefore, the reader is cautioned not to rely on these forward-looking statements.  

SOURCE Michael Foods, Inc.