Ainsworth Lumber Co. Ltd.

Ainsworth Lumber Co. Ltd.

November 27, 2012 11:35 ET

Ainsworth Announces Early Results of Tender Offer and Completion of Debt Refinancing Steps

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 27, 2012) - Ainsworth Lumber Co. Ltd. (TSX:ANS)(TSX:ANS.WT) ("Ainsworth" or the "Company") announced today that as of 5:00 p.m., New York City Time, on November 26, 2012 (the "Consent Expiration"), approximately US$355.3 million of its outstanding US$408.2 million aggregate principal amount of 11% Senior Notes due 2015 (CUSIP No. 009037AM4) (the "2015 Notes") have been tendered pursuant to its previously announced cash tender offer for any and all of the 2015 Notes (the "Tender Offer") and solicitation of consents (the "Consent Solicitation"), as described in the Offer to Purchase and Consent Solicitation Statement (the "Statement") and a related Consent and Letter of Transmittal, each dated November 9, 2012.

The Company also announced today that it will redeem on December 27, 2012 all outstanding 2015 Notes not tendered pursuant to the Tender Offer, which expires at 11:59 p.m., New York City time, on December 10, 2012 (the "Expiration Time"), in accordance with the terms of the indenture governing the 2015 Notes. The 2015 Notes will be redeemed at a price of 100.00% of the principal amount thereof plus accrued and unpaid interest thereon to, but not including, December 27, 2012. Upon the completion of the redemption, no principal amount of 2015 Notes will remain outstanding.

In connection with the Tender Offer, Ainsworth has successfully completed the following steps of its comprehensive refinancing plan announced on October 22, 2012:

  • Ainsworth has accepted for purchase the US$355.3 principal amount of 2015 Notes that were validly tendered and not withdrawn prior to the Consent Expiration and has provided payment for such 2015 Notes (other than approximately US$121.2 million principal amount of the 2015 Notes owned by funds managed by Brookfield Asset Management Inc. and its affiliates for which payment has been deferred in connection with the rights offering referred to below). Those holders who validly tendered their 2015 Notes by the Consent Expiration received the total consideration of US$1,002.50 per US$1,000 principal amount, plus the full amount of accrued and unpaid interest in cash from the last interest payment date up to, but not including, the initial settlement date of November 27, 2012. Ainsworth will redeem all remaining 2015 Notes not validly tendered by the Expiration Time of the Tender Offer, and pending such redemption, has received the requisite consents in the Consent Solicitation and has executed a supplemental indenture effecting the previously proposed amendments to the indenture governing the 2015 Notes to eliminate substantially all the restrictive covenants and certain related events of default under the indenture.
  • Ainsworth has repaid in full the US$102.6 million principal amount outstanding under its existing senior secured term loan.
  • Ainsworth has completed its previously announced private offering of US$350 million in aggregate principal amount of its 7.5% Senior Secured Notes due 2017 (the "New Notes"), which together with the expected proceeds of the previously announced fully backstopped $175 million rights offering, are providing the funds for the comprehensive refinancing plan.

The New Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act") or the securities laws of any other jurisdiction. As a result, the New Notes may not be offered or sold in the United States or to any U.S. persons except pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws. The New Notes have been offered only to qualified institutional buyers pursuant to Rule 144A under the Securities Act and to non-U.S. persons outside the United States under Regulation S under the Securities Act.

This news release does not constitute a notice of redemption under the optional redemption provision of the indenture governing the 2015 Notes, nor does it constitute an offer to sell or the solicitation of an offer to buy any securities of Ainsworth. Nor is it an offer to sell securities or a solicitation of an offer to buy securities in any state or jurisdiction where prohibited by law.

The terms and conditions of the Tender Offer and solicitation of Consents are described in the Statement and related Consent and Letter of Transmittal, each dated November 9, 2012, copies of which may be obtained from Global Bondholder Services Corporation, the depositary and information agent, at (866) 488-1500 (toll-free) or (212) 430-3774 (collect).

Ainsworth has engaged BofA Merrill Lynch to act as the exclusive dealer manager and solicitation agent in connection with the Tender Offer. Questions regarding the terms of the Tender Offer may be directed to BofA Merrill Lynch, Liability Management, at (888) 292-0070 (toll-free) or (980) 387-3907.

Cautionary Statement Regarding Forward-Looking Information

Forward-looking information provided in this news release relating to Ainsworth's expectations regarding the Tender Offer and Consent Solicitation, the Offering and Ainsworth's future prospects and financial position are forward-looking information within the meaning of applicable United States securities laws and pursuant to National Instrument 51-102 promulgated by the Canadian Securities Administrators. Ainsworth believes that expectations reflected in such information are reasonable, but no assurance is given that such expectations will be correct. Forward-looking information is based on Ainsworth's beliefs and assumptions based on information available at the time the assumption was made and on management's experience and perception of historical trends, current conditions and expected further developments as well as other factors deemed appropriate in the circumstances. Investors are cautioned that there are risks and uncertainties related to such forward-looking information and actual results may vary. Important factors that could cause actual results to differ materially from those expressed or implied by such forward looking information include, without limitation, factors detailed from time to time in Ainsworth's periodic reports filed with the Canadian Securities Administrators and other regulatory authorities. The forward-looking information is made as of the date of this news release and Ainsworth assumes no obligation to update or revise them to reflect new events or circumstances, except as explicitly required by securities laws.

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