Watco Companies Announces Expiration Of Tender Offer For 6.375% Senior Notes Due 2023 And Delivery Of Notice Of Redemption For Remaining 6.375% Senior Notes Due 2023

PITTSBURG, Kan., June 18, 2020 /PRNewswire/ -- Watco Companies, L.L.C. and its wholly-owned subsidiary, Watco Finance Corp. (collectively, "Watco") announced today the expiration of the previously announced cash tender offer for any and all of its outstanding 6.375% Senior Notes due 2023 (CUSIP Nos. 941130AA4 and U94127AA2) (the "Notes") on the terms and subject to the conditions set forth in the Offer to Purchase, dated June 11, 2020 (the "Offer to Purchase"), the related Letter of Transmittal (the "Letter of Transmittal"), and the related Notice of Guaranteed Delivery (the "Notice of Guaranteed Delivery"). The tender offer is referred to herein as the "Offer." The Offer to Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery are referred to herein collectively as the "Offer Documents." As of the expiration of the Offer at 5:00 p.m., New York City time, on June 17, 2020 (the "Expiration Time"), $289,742,000, or 72.44%, of the $400,000,000 aggregate principal amount of the Notes had been validly tendered and delivered (and not validly withdrawn), excluding Notes tendered pursuant to a Notice of Guaranteed Delivery in the Offer at or prior to the Expiration Time. Payment for the Notes purchased pursuant to the Offer is intended to be made on or around June 18, 2020 (the "Settlement Date"), and payment for the Notes tendered pursuant to a Notice of Guaranteed Delivery and purchased pursuant to the Offer is intended to be made on or around June 22, 2020 (the "Guaranteed Delivery Settlement Date"). Holders who validly tender their Notes pursuant to the guaranteed delivery procedures described in the Offer Documents must tender their Notes no later than 5:00 p.m., New York City time, on June 19, 2020, the second business day following the Expiration Time to receive the total consideration.

The tender offer consideration for each $1,000 principal amount of the Notes purchased pursuant to the Offer will be $1,013.20. In addition, holders whose Notes are purchased in the Offer will receive accrued and unpaid interest from the most recent interest payment date to, but not including, June 18, 2020. Such amounts will be payable on the Settlement Date or the Guaranteed Delivery Settlement Date, as applicable.

Additionally, Watco announced today that it will redeem all of the remaining outstanding Notes that were not tendered in the Offer.  The redemption date has been set for July 20, 2020 (the "Redemption Date").  In accordance with the redemption provisions of the Notes and the Indenture, dated as of March 22, 2013 (the "Indenture"), by and among Watco, the guarantors party thereto and Wells Fargo Bank, National Association, as trustee, the Notes will be redeemed at (a) a redemption price of $1,010.63 per $1,000 aggregate principal amount of Notes, plus (b) the accrued and unpaid interest to, but not including, the Redemption Date.

The Offer and redemption will be funded from a portion of the net proceeds from the previously announced issuance and sale by Watco of its 6.500% Senior Notes due 2027.

This news release shall not constitute an offer to buy or a solicitation of an offer to sell the Notes or any other securities and shall not constitute an offer, solicitation or sale of any securities in any jurisdiction in which, or to any person to whom, such an offer, solicitation or sale is unlawful. Any such offer, solicitation, purchase or sale will be made only by means of the Offer Documents.

About Watco Companies, L.L.C.

Headquartered in Pittsburg, Kansas, Watco Companies, L.L.C. is a leading integrated transportation services provider with a broad set of capabilities.  Watco provides short line railroad transportation services, terminal and port, logistics, and mechanical solutions to over 4,100 customers across the U.S., Mexico, Canada and Australia. According to Watco's estimates, Watco is the second largest short line railroad operator, one of the largest break bulk terminaling services providers, and one of the largest independent providers of railcar maintenance and repair services in North America.

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of applicable law. Forward-looking statements may be identified by the use of words such as "forecast", "estimate", "project", "intend", "expect", "should", "believe" and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include any statements regarding the tender offer for and redemption of the Notes. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management's good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements, including, but not limited to, Watco's ability to successfully consummate the tender offer or otherwise redeem or discharge all of the Notes; general and industry economic conditions; conditions in the capital and credit markets; Watco's ability to successfully integrate acquisitions; Watco's relationships with Class I railroads and other connecting carriers; risks related to the geographic markets in which Watco operates, including weather conditions; Watco's compliance with governmental regulation and legislative and regulatory developments; Watco's ability to obtain necessary permits and leases to operate its business; Watco's exposure to credit risk of its customers and counterparties; competitive pressures within its industries; risks related to climate change, including market and regulatory responses to climate change and related litigation; Watco's compliance with environmental laws and regulations; Watco's transportation of hazardous materials by rail; rising fuel costs; Watco's dependence on management and key personnel; availability of government funding; Watco's labor relations and the availability of qualified personnel; Watco's reliance on a limited number of suppliers and fluctuations in the supply of components it uses in its industries; risks related to operating in foreign countries; risks related to international trade policies; future acts of terrorism or war; Watco's reliance on technology and technology improvements in its business; risks related to cyber attacks and system disruptions; conflicts of interests among its limited number of equityholders and investors in the Notes; risks related to its joint venture and other investments; and public health threats or outbreaks of communicable diseases (including COVID-19) and actions taken by governmental authorities and others in response thereto. Watco does not intend, and undertakes no duty, to update this information to reflect future events or circumstances, except as required by law.

Media Contact

Cori Kallenbach
Watco Companies
(913) 303-4514
[email protected]

SOURCE Watco Companies, L.L.C.