Tower International, Inc. (NYSE: TOWR), a leading integrated global manufacturer of engineered structural metal components and assemblies, today announced that it has entered into a new credit facility that provides for a term loan in an aggregate amount of$420,000,000. The maturity date for the term loan isApril 23, 2020. The term loan will bear interest at (i) an alternate base rate (which is the highest of the Prime Rate, the Federal Funds Effective Rate plus 1/2% and the Adjusted LIBO Rate (as each such term is defined in the Term Loan Credit Agreement) for a one month interest period plus 1%) plus a margin of 3.50% or (ii) the Adjusted LIBO Rate (calculated by multiplying the applicable LIBOR rate by a statutory reserve rate, with a floor of 1.25%) plus a margin of 4.50%. The proceeds of the credit facility will be used to fund the previously announced cash tender offer (the “Tender Offer”) byTower International, Inc.’s wholly-owned subsidiaries,Tower Automotive HoldingsUSA, LLC andTA Holdings Finance, Inc. (such subsidiaries collectively, the “Company”), to purchase up to$275,992,000 of the Company’s outstanding 10.625% Senior Secured Notes due 2017 (the “Notes”), pay for transaction expenses and, pursuant to the terms of the indenture governing the Notes (the “Indenture”), satisfy the anticipated redemption of up to$86,000,000aggregate principal amount of the Notes.
The Tender Offer expired at12:01 a.m.,New York Citytime onApril 22, 2013. An aggregate principal amount of$361,992,000of the Notes was validly tendered in the Tender Offer and not validly withdrawn. The Company accepted for purchase on a pro rata basis$275,992,000in aggregate principal amount of such Notes. The amount of Notes purchased was determined under the terms and conditions of the Tender Offer as set forth in the Offer to Purchase, datedMarch 15, 2013, as such Offer to Purchase was amended byTower International, Inc.’s press release datedApril 5, 2013. The Notes that were tendered but not accepted in the Tender Offer will be promptly returned to the tendering parties.
Pursuant to the terms of the Indenture, the Company intends to redeem up to$86,000,000aggregate principal amount of Notes, to the extent such amounts remain outstanding, at a redemption price of 105.0% of the principal amount thereof, plus accrued and unpaid interest. The Company expects to redeem$43,000,000of such principal amount on or aboutMay 24, 2013following notice of redemption on or aboutApril 23, 2013and to redeem the balance thereof on or aboutAugust 24, 2013following notice of redemption to the holders of Notes on or aboutJuly 25, 2013. There is no assurance, however, that any such redemption will occur.
In connection with the new credit facility, the Tender Offer and the anticipated redemptions of$86,000,000in aggregate principal amount of the Notes described above,Tower International, Inc.anticipates it will incur charges of approximately$50 millionin the second quarter of 2013 and charges of approximately$3 millionin the third quarter of 2013. These charges relate to the tender premium, accelerated amortization of original issue discount and fees, and expenses associated with the Tender Offer.
Citigroup Global Markets Inc.served as dealer manager for the Tender Offer. Global Bondholder Services Corporationserved as the depositary and the information agent for the Tender Offer. Questions regarding the Tender Offer may be directed toCitigroup Global Markets Inc.at either (800) 558-3745 or collect at (212) 723-6106.
