Interline Brands, Inc., a Delaware corporation (NYSE:IBI) (the
"Company"), announced today that its wholly owned subsidiary,
Interline Brands, Inc. a New Jersey corporation (the "Issuer"), is
soliciting consents from holders of its outstanding 7.00% Senior
Subordinated Notes due 2018 (the "Notes") to approve amendments
(the "Solicited Amendments") to amend the definition of "Change of
Control" contained in, and add a definition of "Permitted Holders"
to, the Indenture, dated as of November 16, 2010 (as amended by the
First Supplemental Indenture, dated June 19, 2012, the "Indenture")
to allow GS Capital Partners VI, L.P., P2 Capital Master Fund I,
L.P. and their respective affiliates (collectively, the "New
Sponsors") to jointly acquire control (the "Merger") of the Company
(together with its direct and indirect subsidiaries, collectively,
"we," "us" or "Interline Brands"), without triggering a "Change of
Control" as defined in the Indenture.
Only Holders of Notes are eligible to consent to the Proposed
Amendments. The term "Holder" means each person shown on the
records of the registrar for the Notes as a holder. For purposes of
the Consent Solicitation, The Depository Trust Company ("DTC") has
authorized DTC participants ("DTC Participants") set forth in the
position listing of DTC to execute Consent Letters as if they were
the Holders of the Notes held of record in the name of DTC or the
name of its nominee. Accordingly, for purposes of the Consent
Solicitation, the term "Holder" shall be deemed to include such DTC
Participants.
As consideration for the Solicited Amendments:
(i) Isabelle Acquisition Sub Inc. will make a cash payment on
behalf of the Issuer of $5.00 per $1,000 (the "Consent Payment") in
aggregate principal amount of Notes held by each holder of Notes as
of the Record Date who has validly delivered a duly executed
consent at or prior to the Expiration Time (as defined below) and
who has not revoked the consent in accordance with the procedure
described in the Consent Solicitation Statement (as defined
below);
(ii) the Issuer will amend the Indenture to increase the
interest rate on the Notes under the Indenture from 7.00% to 7.50%
per annum;
(iii) the Issuer will amend the Indenture to increase the
redemption price of the Notes for the twelve-month period
commencing on November 15, 2013 and ending on November 15, 2014 to
105.625% and the twelve-month period commencing on November 15,
2014 and ending on November 15, 2017 to 103.75%;
(iv) the Issuer will amend the Indenture to make the Notes
senior notes ranking equal in right of payment to all future
incurrences of senior indebtedness (including Indebtedness under
the new asset based loan facility expected to be entered into in
connection with the Merger by amending the definition of "Senior
Indebtedness" to include only Indebtedness that is outstanding
immediately prior to the date that the Merger is consummated
(including any amendment or modification to such Indebtedness);
and
(v) the Issuer will amend the Indenture to replace the
restriction on the incurrence of secured Indebtedness contained in
the anti-layering covenant with a covenant restricting the Issuer
and the Subsidiary Guarantors from incurring Liens, other than
certain Permitted Liens (as defined in the Consent Solicitation
Statement), without equally and ratably securing the Notes, which
Permitted Liens will include customary exclusions as well as a
basket for Permitted Liens based on a 2.25 to 1.00 secured leverage
ratio test for incurrence of secured Indebtedness by the Issuer and
its restricted subsidiaries.
The amendments set forth above in paragraphs (ii) to (v) (such
amendments, the "Beneficial Amendments") and, together with the
Solicited Amendments, comprise the proposed amendments (the
"Proposed Amendments"). The Solicited Amendments will be
operative upon payment of the Consent Payment and the Beneficial
Amendments will become operative only if and when the Merger is
consummated.
The Consent Payment will be paid three business days after the
"Cut-Off Date" referred to in the Agreement and Plan of Merger (the
"Merger Agreement") entered into by the Company, Isabelle Holding
Company Inc., and Isabelle Acquisition Sub Inc. on May 29, 2012
(the "Go-Shop Cut-Off Date") (but in any event no later than July
27, 2012), provided that the Merger Agreement has not theretofore
been terminated.
Adoption of the Proposed Amendments requires the consent of the
holders of at least a majority of the aggregate principal amount of
all outstanding Notes voting as a single class (such consent, the
"Requisite Consents"). The aggregate outstanding principal amount
of the Notes as of June 21, 2012 was $300,000,000. Consents may be
validly revoked at any time prior to the Effective Time (as defined
below) but not thereafter.
The Issuer anticipates that, promptly after receipt of the
Requisite Consents prior to the Expiration Time, the Issuer will
give notice to Wells Fargo Bank, National Association, as trustee
(the "Trustee"), that the Requisite Consents have been obtained and
the Issuer, the Company, as parent guarantor, the subsidiary
guarantors party to the Indenture, and the Trustee will execute and
deliver a supplemental indenture with respect to the Indenture (the
"Supplemental Indenture" and such time, the "Effective Time").
Pursuant to the terms of the Supplemental Indenture, the Proposed
Amendments will become effective at the Effective Time and shall
thereafter bind every holder of Notes. However, if the Merger is
not consummated on or prior to November 29, 2012 (as such date may
be extended pursuant to the Merger Agreement), (the "Merger Outside
Date"), all of the Proposed Amendments, including the Solicited
Amendments shall be of no further effect. However, Holders
that receive a Consent Payment prior to the Merger Outside Date
will still be entitled to such Consent Payment if the Merger is not
consummated on or prior to the Merger Outside Date.
The consent solicitation will expire at 5:00 p.m., New York City
time, on June 28, 2012 (such date and time, as the Issuer may
extend from time to time, the "Expiration Time"). Only holders on
the Record Date are eligible to deliver consents to the Proposed
Amendments in the consent solicitation.
The consent solicitation is being made solely on the terms and
subject to the conditions set forth in the Consent Solicitation
Statement, dated June 21, 2012 (as may be amended or supplemented
from time to time, the "Consent Solicitation Statement"), and the
accompanying Consent Letter (together, the "Consent Solicitation
Documents"). The Issuer may, in its sole discretion, terminate,
extend or amend the consent solicitation at any time as described
in the Consent Solicitation Statement.
Copies of the Consent Solicitation Documents and other related
documents may be obtained from Global Bondholder Services
Corporation, the Information and Tabulation Agent, at (212)
430-3774 (collect) or (866)-937-2200 (toll free). Holders of the
Notes are urged to review the Consent Solicitation Documents for
the detailed terms of the consent solicitation and the procedures
for consenting to the Proposed Amendments. Any persons with
questions regarding the consent solicitation should contact the
Solicitation Agents, Goldman, Sachs & Co., at
(212) 357-0345 (collect) or (800) 828-3182 (toll free) or
BofA Merrill Lynch, at (980) 387-3907 (collect) or (888) 292-0070
(toll free).
This announcement is for information purposes only and is
neither an offer to sell nor a solicitation of an offer to buy any
security. The Holdco Notes have not been, and will not be,
registered under the U.S. Securities Act of 1933, as amended, or
any state securities laws, and may not be offered or sold in the
United States absent registration or an applicable exemption from
the registration requirements. This announcement is also not a
solicitation of consents with respect to the Proposed Amendments or
any securities. No recommendation is being made as to whether
holders of Notes should consent to the Proposed Amendments. The
solicitation of consents is not being made in any jurisdiction in
which, or to or from any person to or from whom, it is unlawful to
make such solicitation under applicable state or foreign securities
or "blue sky" laws.
About Interline Brands
Interline Brands is a leading distributor and direct marketer
with headquarters in Jacksonville, Florida. Interline Brands
provides broad-line maintenance, repair and operations products to
a diversified customer base of facilities maintenance
professionals, professional contractors, and specialty distributors
primarily throughout North America, Central America and the
Caribbean. For more information, visit the Company's website
at http://www.interlinebrands.com.
Forward-Looking Statements
Certain statements set forth in this press release constitute
"forward-looking statements" as that term is defined under
Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as
amended.
Forward-looking statements include information concerning
possible or assumed future results of operations, descriptions of
our business plans and strategies, the expected timing of the
Merger, and the effect of the Proposed Amendments or the Merger on
the Notes or on us. These statements often include words such as
"anticipate," "expect," "suggest," "plan," "believe," "intend,"
"estimate," "target," "project," "forecast," "should," "could,"
"would," "may," "will" and other similar expressions. We base these
forward-looking statements on our current expectations, plans and
assumptions that we have made in light of our experience in the
industry, as well as our perceptions of historical trends, current
conditions, expected future developments and other factors we
believe are appropriate under the circumstances and at the time
such statements were made. Although we believe that these
forward-looking statements are based on reasonable assumptions, you
should be aware that many important factors could affect our actual
financial results, results of operations, the Proposed Amendments,
the Notes, the Merger or the related financing, and could cause our
actual results or the Proposed Amendments, the Merger or the
related financing to differ materially from those expressed in the
forward-looking statements. Such factors include, but are not
limited to, those set forth under the heading "Risk Factors" in the
Consent Solicitation Statement, in our Annual Report on Form 10-K
for the fiscal year ended December 30, 2011 and in any report,
statement or other information that we incorporate by reference in
the Consent Solicitation Statement. You should consider these areas
of risk in connection with considering any forward-looking
statements that may be made by us generally. The forward-looking
statements contained in this press release speak only as of the
date of this press release. Except as may be required by the
federal securities laws, we undertake no obligation to publicly
release the result of any revisions to these forward-looking
statements to reflect events or circumstances after the date of
this press release or to reflect the occurrence of unanticipated
events.
CONTACT: Lev Cela
PHONE: 904-421-1441
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