American Railcar Industries, Inc.'s Wholly Owned Subsidiary Commences Consent Solicitation From Its Noteholders
26 Mars 2018 - 11:06PM
American Railcar Industries, Inc. (NASDAQ:ARII) (“ARI” or the
“Company”) today announced that, as part of our continuing
transition to manage our leasing business in-house, we are in the
process of obtaining the approvals necessary to allow ARI to manage
the railcars owned by our wholly owned subsidiary, Longtrain
Leasing III, LLC (“Longtrain”).
Specifically, Longtrain has commenced the
solicitation of consents from the holders of its 2.98% Fixed Rate
Secured Railcar Equipment Notes, Class A-1 (the “Class A-1 Notes”)
and its 4.06% Fixed Rate Secured Railcar Equipment Notes, Class A-2
(the “Class A-2 Notes,” and together with the Class A-1 Notes, the
“Notes”) to the approval of an amendment (the “First Indenture
Supplement”) to the indenture governing such Notes (the
“Indenture”) to allow ARI to act as the manager of the railcars
that serve as collateral under the Indenture, and entry into new
agreements providing for such management, including a replacement
management agreement and new lease administration and collateral
agency agreements (collectively, the “New Agreements”). The
Indenture currently provides that the Company’s former affiliate,
American Railcar Leasing LLC (“ARL”), act as manager. ARL was
sold to an unaffiliated third party effective June 1,
2017.
The consent solicitation is being made in
accordance with the terms and subject to the conditions set forth
in a Consent Solicitation Statement, dated March 26, 2018 (the
“Consent Solicitation Statement”), and in a related Consent Form
(the “Consent Form”) to holders of record as of 5:00 p.m., New York
City time, on March 23, 2018. The consent solicitation is
scheduled to expire at 5:00 p.m., New York City time, on April 10,
2018, unless extended or earlier terminated (the “Consent
Expiration Time”). Approval of the First Indenture Supplement
and New Agreements requires the consent of the holders of not less
than a majority in aggregate of the total principal balance of such
Notes that remains unpaid and outstanding at any time (other than
ARI and its affiliates) (the “Requisite Majority”).
If the approval of the Requisite Majority is
received, holders of Notes who validly and timely deliver executed
Consent Forms (and do not validly revoke such Consent Forms) in the
manner described in the Consent Solicitation Statement and the
Consent Form will be eligible to receive a consent fee equal to
$1.50 per $1,000 of the respective outstanding principal balance of
Notes held or beneficially held by such holders with respect to
which such holders have consented. Holders providing consent
after the Consent Expiration Time will not receive a consent
fee. The consent fee will be paid to consenting holders as
promptly as practicable after the satisfaction or waiver of the
conditions to the consent solicitation, as further described in the
Consent Solicitation Statement.
The consummation of the consent solicitation is
subject to a number of conditions that are set forth in the Consent
Solicitation Statement, including without limitation (1) the
receipt of the consents of the Requisite Majority prior to the
Consent Expiration Time (which consents shall not have been validly
and timely revoked) and (2) the execution and delivery of the First
Indenture Supplement and the New Agreements.
Consents may be revoked at any time up to, but
will become irrevocable upon, the Consent Expiration Time. If
the consent of the Requisite Majority is received, then upon
execution of the First Indenture Supplement and the New Agreements,
these agreements will be operative and binding upon all holders of
the Notes, whether or not such holders have delivered consents.
A more comprehensive description of the consent
solicitation and the proposed amendment can be found in the Consent
Solicitation Statement and related Consent Form.
D.F. King & Co., Inc. is serving as the
tabulation agent and information agent for the consent
solicitation. Requests for documents should be directed to
D.F. King & Co., Inc., 48 Wall Street, 22nd Floor, New York, NY
10005. Banks and brokers please call (212) 269-5550, all
others please call (877) 478-5040 or email ARII@dfking.com.
Credit Suisse Securities (USA) LLC is serving as the solicitation
agent for the consent solicitation. Questions regarding the
consent solicitation may be directed to Credit Suisse Securities
(USA) LLC at Eleven Madison Avenue, New York NY 10010-3629 or via
phone at (212) 325-9896 or (800) 820-1653.
This press release, the Consent Solicitation
Statement, and the related Consent Form shall not constitute an
offer to sell or a solicitation of an offer to purchase any Notes
or other securities. The consent solicitations are being made
only by, and pursuant to the terms of, the solicitation documents,
and the information in this press release is qualified by reference
to the solicitation documents. No recommendation is made, or
has been authorized to be made, as to whether or not holders of
Notes should consent to the adoption of the First Indenture
Supplement and the New Agreements pursuant to the consent
solicitation. Each holder of Notes must make its own decision
as to whether to give its consent.
About American Railcar Industries,
Inc.
ARI is a prominent North American designer and
manufacturer of hopper and tank railcars. ARI provides its railcar
customers with integrated solutions through a comprehensive set of
high quality products and related services. ARI manufactures and
sells railcars, custom designed railcar parts, and other industrial
products. ARI and its subsidiaries also lease railcars manufactured
by the Company to certain markets. In addition, ARI and its
subsidiaries provide railcar repair services through its various
repair facilities, including mini-shops and mobile units, offering
a range of services from full to light repair. More information
about American Railcar Industries, Inc. is available on its website
at americanrailcar.com or call the Investor Relations Department,
636.940.6000.
Forward Looking Statement
Disclaimer
This press release contains statements relating
to the Company's objectives, long-term strategies and/or future
business prospects, events and plans that are forward-looking
statements within the meaning of Section 27A of the United States
Securities Act of 1933, as amended, and Section 21E of the United
States Securities Exchange Act of 1934, as amended. Forward-looking
statements represent the Company’s estimates and assumptions only
as of the date of this press release. Such statements include,
without limitation, statements regarding: the Company’s management
of its and its subsidiaries’ railcars, the ability to obtain the
consent of the requisite number of holders of the Notes, the
Company’s intent to pay a consent fee upon the completion of
certain conditions, and the Company’s strategic objectives and
long-term strategies. These forward-looking statements are
subject to known and unknown risks and uncertainties that could
cause actual results to differ materially from those anticipated.
Investors should not place undue reliance on forward-looking
statements, which speak only as of the date they are made and are
not guarantees of future performance. Potential risks and
uncertainties that could adversely affect our business and
prospects include without limitation: the risk that holders of
Notes do not respond or do not consent to the actions for which
consents are being solicited on the terms the Company has proposed
and the additional risk factors described in ARI’s filings with the
Securities and Exchange Commission. The Company expressly disclaims
any duty to provide updates to any forward-looking statements made
in this press release, whether as a result of new information,
future events or otherwise.
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