North Atlantic Trading Company Commences Tender Offers And Consent Solicitations For Its Senior Secured Second Lien Notes And Senior Secured Third Lien Notes

LOUISVILLE, Ky., Nov. 27, 2013 /PRNewswire/ -- North Atlantic Trading Company, Inc. (the "Company") today announced the commencement of cash tender offers and consent solicitations for any and all of its outstanding senior secured second lien notes and senior secured third lien notes.

The Company announced cash tender offers for any and all of its $205,000,000 outstanding principal amount of 11.5% Senior Secured Second Lien Notes due 2016 (the "Second Lien Notes") and $86,528,000 outstanding principal amount of 19% Senior Secured Third Lien Notes due 2017 (the "Third Lien Notes" and, together with the Second Lien Notes, the "Notes") and its solicitation of consents from the holders of the Notes to adopt certain amendments to the indentures governing the Notes.

The following table sets forth the Notes subject to the tender offers and consent solicitations:

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1  For each $1,000 principal amount of Notes, excluding accrued but unpaid interest thereon, which interest will be paid in addition to the Offer Consideration or the Total Consideration, as applicable.
2  Total Consideration includes the Early Consent Payment.

The tender offers are scheduled to expire at 11:59 P.M., New York City time, on December 26, 2013, unless extended or earlier terminated (the "Expiration Time").  Holders who validly tender their Notes and deliver their consents by 5:00 P.M., New York City time, on December 11, 2013, unless extended or earlier terminated (the "Early Consent Deadline"), will receive the Total Consideration specified above if such Notes are accepted for purchase, which includes a payment of $94.44 per $1,000 principal amount of Second Lien Notes and $156.86 per $1,000 principal amount of Third Lien Notes (the "Early Consent Payment").  Holders who validly tender their Notes and deliver their consents after the Early Consent Deadline but before the Expiration Time will receive the Offer Consideration specified above, if such Notes are accepted for purchase. 

Holders who validly tender and do not validly withdraw their Notes (and thereby validly deliver and do not validly revoke their consents) by the Early Consent Deadline will be paid the Total Consideration on the Initial Payment Date, which, if the Company so elects, is expected to be a business day following the Early Consent Deadline but before the Expiration Time.  Holders who validly tender their Notes after the Early Consent Deadline but by the Expiration Time will be paid only the Offer Consideration on the Final Payment Date, which date is expected to be no later than January 2, 2014.  In both cases, Holders will receive applicable accrued and unpaid interest from, and including, the last interest payment date to, but not including, the applicable payment date. The consents are being solicited to eliminate substantially all of the restrictive covenants, certain related events of default and certain other provisions contained in the indentures governing the Notes. In addition, if the proposed amendments become operative, a notice of redemption to Holders whose Notes are to be redeemed will be permitted to be provided not less than five days before a redemption date instead of not less than 30 days before a redemption date as currently required under the indentures governing the Notes.  Holders may not tender their Notes without delivering consents or deliver consents without tendering their Notes. The Company currently intends to call for redemption all of the Notes that have not been tendered, although it reserves the absolute right, in its sole discretion, not to do so. The Company may currently redeem any outstanding Notes at a price equal to $1,086.25 for each $1,000 principal amount of Second Lien Notes and $1,142.50 for each $1,000 principal amount of Third Lien Notes.

The Company expects to use the net proceeds of one or more debt financing transactions, including one or more bank loans (including revolving facilities) or potential debt securities offerings, to pay the Total Consideration.  The tender offers are subject to the satisfaction or waiver of certain conditions, including the consummation of the financing transactions and general conditions.

Noteholders may withdraw tenders and revoke consents at any time prior to the earlier of (1) 5:00 p.m., New York City time, on December 11, 2013 (which may be extended by the Company in its sole discretion) and (2) the date on which a supplemental indenture applicable to their series of Notes is executed, which is expected to promptly follow receipt of the consents of a majority of the Notes outstanding of any applicable class voting together under an indenture.

Questions regarding the tender offers and consent solicitations may be directed to North Atlantic Trading Company, Inc., 5201 Interchange Way, Louisville, Kentucky, Attention: Chief Financial Officer, or by calling: 1-508-778-4421. You may also contact your broker, dealer, commercial bank or trust company or other nominee for assistance.

The complete terms and conditions of the tender offers and consent solicitations are described in the Offer to Purchase and Consent Solicitation Statement, dated November 27, 2013, and the related Consent and Letter of Transmittal, copies of which may be obtained by contacting Global Bondholder Services Corporation as Tender Agent and Information Agent, at (866) 470-3800 (U.S. toll-free) or (212) 430-3774 (banks and brokers).  The Offer to Purchase and Consent Solicitation Statement and related Consent and Letter of Transmittal also address certain U.S. federal income tax consequences. Holders should seek their own advice based on their particular circumstances from an independent tax advisor.

None of the Company, Global Bondholder Services Corporation, the Tender Agent and Information Agent for the tender offers and consent solicitations, or U.S. Bank National Association, as Trustee and Collateral Agent for the Notes, makes any recommendation as to whether Holders should tender their Notes pursuant to the tender offers or consent to the proposed amendments to the indentures, and no one has been authorized by any of them to make such recommendations.  Holders must make their own decisions as to whether to tender Notes and deliver consents and, if so, the principal amount of Notes to tender.

This press release is for informational purposes only and does not constitute an offer to purchase, a solicitation of an offer to sell nor a solicitation of consents with respect to any Notes or other securities, nor shall there be any purchase of Notes or solicitation of consents in any state or jurisdiction in which such offer, solicitation or purchase would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.  The tender offers and consent solicitations are being made solely by the Offer to Purchase and Consent Solicitation Statement dated November 27, 2013 and the related Consent and Letter of Transmittal.  In any jurisdiction where the laws require the tender offers and consent solicitations to be made by a licensed broker or dealer, they will be deemed made on behalf of the Company by one or more registered brokers or dealers under the laws of such jurisdiction.  The tender offers and consent solicitations are not being made in any jurisdiction in which the making or acceptance thereof would not be in compliance with the laws of such jurisdiction.

Statements in this release that are not historical facts are forward-looking statements involving risks and/or uncertainties.  The Company has based forward-looking statements on management's current expectations and assumptions and not on historical facts. Examples of these statements include, but are not limited to, statements regarding the completion of the tender offers. These forward-looking statements involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated in such forward-looking statements include effects of substantial and increasing regulation and the cost of compliance or failure to comply with such regulations, competition in the tobacco industry, the development, production and commercialization of competitive new products and technologies and strict limitations on advertising and marketing of tobacco products. In providing forward-looking statements, the Company is not undertaking any duty or obligation to update these statements publicly as a result of new information, future events or otherwise, except as required by law.

SOURCE North Atlantic Trading Company, Inc.