Fleetwood Announces Exchange Offer For Its 5% Debentures With Terms That Preserve Liquidity and Minimize Dilution
30 Outubro 2008 - 7:45AM
PR Newswire (US)
RIVERSIDE, Calif., Oct. 30 /PRNewswire-FirstCall/ -- Fleetwood
Enterprises, Inc. (NYSE:FLE) announced today that it is commencing
a registered exchange offer for its existing $100 million principal
amount of 5% convertible senior subordinated debentures. Holders
have the right to require Fleetwood to repurchase the debentures at
par on December 15, 2008. The exchange offer proposes terms for new
senior secured notes due 2011 that are guaranteed by certain
Fleetwood subsidiaries, together with the issuance of common stock.
Separately, the Company announced it has received notification from
the New York Stock Exchange of non-compliance with the NYSE's
minimum share price standard. The Exchange Offer: Preserving
Liquidity and Minimizing Dilution Fleetwood may use cash, stock, or
a combination of both to meet its 5% debenture repurchase
obligations in December 2008; however, the Company has determined
that it is in the best interest of Fleetwood and its constituencies
to pursue this exchange offer in order to preserve liquidity and to
avoid undue dilution of existing shareholders. Accordingly, the
exchange offer has built-in incentives to encourage a greater
percentage of participation by the holders of the existing
debentures. The notes offered in the exchange offer provide
existing holders with an increase in yield, the benefits of a
security interest, a three-year maturity, and a limited amount of
common stock while eliminating the burden on Fleetwood of the
existing repurchase obligations. The successful completion of the
exchange offer will provide Fleetwood further opportunity to
stabilize its businesses and strengthen its competitive position
during the expected recovery of the markets for its products. The
exchange offer is subject to several conditions, including (1) a
declaration from the Securities and Exchange Commission (SEC) that
the registration statement is effective, and (2) the valid tender,
without withdrawal, of a minimum of 33.5 percent, or $33.5 million,
of the existing 5% debentures. A holder with ownership of
approximately $33.9 million of the debentures has notified the
Company that it intends to accept the new senior notes and common
stock through the exchange offer. The exchange offer is scheduled
to expire at 5 p.m., Eastern Time, on December 5, 2008, unless
terminated earlier or extended. Holders who opt to participate in
the exchange will receive the following for each $1,000 of
debentures: -- $1,030 in the new senior secured notes, which are
(1) senior obligations of Fleetwood, (2) secured by a first
priority lien on approximately $20 million of unencumbered real
estate assets of certain Fleetwood subsidiaries and a junior lien
on approximately $58 million of certain of Fleetwood's
subsidiaries' real properties that are pledged to secure its credit
facility, (3) guaranteed on a subordinated basis to Fleetwood's
credit facility by certain Fleetwood subsidiaries, and (4) due
three years from the date of issuance; -- a coupon rate for the
senior secured notes of at least 12 percent consisting of: -- 5
percent payable in cash, -- 7 percent pay-in-kind interest (PIK
interest), plus -- a 50-basis-point increase in the PIK interest
every six months up to a maximum of 9 percent PIK interest; --
Fleetwood common stock, the amount of which is dependent on its
trading price. In aggregate, the Company will issue a minimum of $4
million in stock, with the number of shares determined on a
volume-weighted-average basis but subject to a minimum price of
$0.75 per share; and -- payment of accrued and unpaid interest for
any debentures accepted in the exchange offer. In addition, as an
incentive to increase participation in the exchange offer,
escalation factors will be implemented at participation levels of
$55 million, $70 million, and $85 million. At each of these levels,
the Company will provide an increase of: -- approximately 67 basis
points in the PIK interest rate, payable from the issue date,
subject to an overall cap of 9 percent in PIK interest; and --
approximately $2.2 million in stock, subject to a maximum of $10.5
million at the $0.75 minimum share price, or 14,000,000 shares. The
Company's secured credit facility with a syndicate of lenders led
by Bank of America has been amended to accommodate the terms of the
senior secured notes. In particular, collateral was freed from the
facility to provide security for the notes. The real estate term
loan commitment was eliminated and borrowings of $12.8 million were
repaid in full. The amendment also reduced the total amount of real
estate collateral held by the lenders from $79 million to $58
million, reduced the loan commitments for the revolving credit
facility to $135 million, and increased the interest rates charged
under the facility. NYSE Below-Criteria Letter Fleetwood has
received formal notification from NYSE Regulation, Inc. that it is
not in compliance with the NYSE $1.00 average share price continued
listing standard. The continued listing standard requires that the
average closing price per share of common stock be at least $1.00
per share over a consecutive 30 trading-day period. Under the
NYSE's continued listing standards, Fleetwood must return to
compliance with the $1.00 average share price standard within six
months to avoid delisting. Fleetwood is pursuing various solutions
to satisfy the continued listing standard, including successful
completion of this exchange offer and the satisfactory resolution
in December 2008 of any debenture repurchase obligations. In
addition, the Company is continuing to develop and complete ongoing
restructuring initiatives to improve operations and further reduce
costs. Important Information Regarding Exchange Offer In connection
with the exchange offer, a registration statement on Form S- 4, a
tender offer statement on Schedule TO, and related documents
relating to the exchange offer are being filed by Fleetwood with
the SEC. The senior secured notes and common stock may not be
exchanged or sold nor may offers to exchange or buy be accepted
prior to the time the registration statement becomes effective.
This news release shall not constitute an offer to exchange or
sell, or the solicitation of an offer to exchange or buy, nor shall
there be any exchange or sale of such securities in any state in
which such offer, exchange, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of
any such state. Holders of the debentures are strongly advised to
read the registration statement, tender offer statement and other
related documents because these documents contain important
information. Such holders may obtain copies of the exchange offer
materials from MacKenzie Partners, the information agent for the
exchange offer, at 800-322-2885. These documents can also be
obtained at no charge from Fleetwood or at the SEC's website,
http://www.sec.gov/. Fleetwood is not making any recommendation to
holders of outstanding debentures as to whether they should tender
them pursuant to the exchange offer. About Fleetwood Fleetwood
Enterprises, Inc., through its subsidiaries, is a leading producer
of recreational vehicles and manufactured homes. This Fortune 1000
company, headquartered in Riverside, Calif., is dedicated to
providing quality, innovative products that offer exceptional value
to its customers. Fleetwood operates facilities strategically
located throughout the nation, including recreational vehicle,
factory-built housing and supply subsidiary plants. For more
information, visit the Company's website at
http://www.fleetwood.com/. This press release contains certain
forward-looking statements and information based on the beliefs of
Fleetwood's management as well as assumptions made by, and
information currently available to, Fleetwood's management. Such
statements, including those regarding Fleetwood's ability to
stabilize its businesses and return to strength, the benefits
relating to completion of the exchange offer, and the scheduled
expiration date of the exchange offer, reflect the current views of
Fleetwood with respect to future events and are subject to certain
risks, uncertainties, and assumptions, including risk factors
identified in Fleetwood's 10-K and other SEC filings. These risks
and uncertainties include, without limitation, the significant
demands on our liquidity while current economic and credit
conditions are severely affecting our operations, including the
potential repurchase of 5% debentures in December 2008 if the
exchange offer is not fully subscribed and we do not have
sufficient shares of common stock to satisfy the obligation to
repurchase the remaining amount of the 5% debentures outstanding;
the lack of assurance that we will regain sustainable profitability
in the foreseeable future; our potential inability to decrease our
operating losses and negative cash flow; the effect of ongoing
weakness in both the manufactured housing and recreational vehicle
markets, especially the recreational vehicle market which has
deteriorated sharply in recent months; the effect of a decline in
home equity values, volatile fuel prices and interest rates, global
tensions, employment trends, stock market performance, credit
crisis, availability of financing generally, and other factors that
can and have had a negative impact on consumer confidence, and
which may reduce demand for our products, particularly recreational
vehicles; the availability and cost of wholesale and retail
financing for both manufactured housing and recreational vehicles;
our ability to comply with financial tests and covenants on
existing and future debt obligations, including restrictive
covenants in the indenture governing the new senior secured notes;
our ability to obtain, on reasonable terms if at all, the financing
we will need in the future to execute our business strategies; the
volatility of our stock price and the risk of potential delisting
from the NYSE; potential dilution associated with future equity or
equity-linked financings we may undertake to raise additional
capital and the risk that the equity pricing may not be favorable;
the cyclical and seasonal nature of both the manufactured housing
and recreational vehicle industries; the increasing costs of
component parts and commodities that we may be unable to recoup in
our product prices; repurchase agreements with floorplan lenders,
which we currently expect could result in increased costs due to
the deteriorated market conditions; expenses and uncertainties
associated with the entry into new business segments or the
manufacturing, development, and introduction of new products; the
potential for excessive retail inventory levels and dealers' desire
to reduce inventory levels in the manufactured housing and
recreational vehicle industries; the effect on our sales, margins
and market share from aggressive discounting by competitors;
potential increases in the frequency and size of product liability,
wrongful death, class action, and other legal actions; and the
highly competitive nature of our industries and changes in our
competitive landscape. Filed by Fleetwood Enterprises, Inc.
pursuant to Rule 425 under the Securities Act of 1933 and Rule
13e-4 under the Securities Exchange Act of 1934 Subject Company:
Fleetwood Enterprises, Inc. Commission File No. 001-7699 Contact:
Lyle Larkin, Vice President -- Treasurer, (951) 351-3535 -- Kathy
A. Munson, Director -- Investor Relations, (951) 351-3650
DATASOURCE: Fleetwood Enterprises, Inc. CONTACT: Lyle Larkin, Vice
President-Treasurer, +1-951-351-3535, or Kathy A. Munson,
Director-Investor Relations, +1-951-351-3650, both of Fleetwood
Enterprises, Inc. Web site: http://www.fleetwood.com/
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