iStar Financial Announces Pricing for Exchange Offer for its 8.75% Senior Notes due 2008
NEW YORK, Oct. 2 /PRNewswire-FirstCall/ -- iStar Financial Inc. (NYSE: SFI) today announced the pricing for its offer to exchange iStar 5.95% Senior Notes due 2013 ("2013 notes") for up to $240 million principal amount outstanding of iStar 8.75% Senior Notes due 2008 ("2008 notes").
The total exchange price for the 2008 notes is based on a fixed-spread pricing formula. The total exchange price for each $1,000 principal amount of 2008 notes tendered and accepted, using an exchange offer yield of 5.150% will be $1,063.10, consisting of $1,000 principal amount of 2013 notes plus a $56.75 cash amount equal to the amount by which the total exchange price of the 2008 notes exceeds the issue price of the 2013 notes. The 2013 notes will mature on October 15, 2013 and will bear interest at an annual rate of 5.95%. The issue price of the 2013 notes, using a yield of 5.837%, will be $1,006.35.
The total exchange price of the 2008 notes includes an early participation payment of $30.00 per $1,000 principal amount of 2008 notes tendered, payable only to holders of 2008 notes that validly tender and do not withdraw their 2008 notes at or before 5:00 p.m., New York City time, October 2, 2006 ("early exchange date"), which date is subject to extension. Holders that tender 2008 notes after such time will receive the total exchange price less the $30.00 early participation payment.
The exchange offer will expire at 12:00 midnight, New York City time, on October 17, 2006 ("expiration date"), unless otherwise extended or terminated.
In addition, holders who validly tender and do not withdraw their 2008 notes on or before the early exchange date will receive accrued interest on the 2008 notes to October 4, 2006 ("early settlement date") of $11.91 per $1,000 principal amount of the 2008 notes, minus the accrued interest on the 2013 notes to the early settlement date of $1.98 per $1,000 principal amount of the 2013 notes. Holders who validly tender their 2008 notes after the early exchange date but on or before the expiration date, will receive accrued interest on the 2008 notes to October 18, 2006 ("final settlement date") of $15.31 per $1,000 principal amount of 2008 notes, minus the accrued interest on the 2013 notes to the final settlement date of $4.30 per $1,000 principal amount of the 2013 notes.
iStar is concurrently soliciting consents to amend two covenants in the indenture governing the 2008 notes. Eligible Holders may not tender their 2008 notes without delivering consents or deliver consents without tendering the 2008 notes. If the requisite consents to amend the indenture are received, iStar will sign a supplemental indenture reflecting the amended covenants.
Tenders of 2008 notes may be withdrawn at any time prior to the early exchange date, subject to extension. Tenders of 2008 Notes after such time may not be withdrawn.
Consummation of the exchange is subject to a number of conditions, including the absence of certain adverse legal and market developments and the valid tender of more than $120 million principal amount of 2008 notes.
The offering is only made, and copies of the offering documents will only be made available to, holders of 2008 notes that have certified certain matters to iStar, including their status as "qualified institutional buyers" within the meaning of Rule 144A, or non-U.S. persons as defined under Regulation S, under the Securities Act of 1933 ("Eligible Holders"). An offering memorandum, dated today, will be distributed to Eligible Holders and is available only to Eligible Holders through the information agent, Global Bondholder Services Corporation, at 866-387-1500 or 212-430-3774.
The 2013 notes have not been registered under the Securities Act or any state securities laws. Therefore, the 2013 notes may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws.
This press release does not constitute an offer to purchase any securities or a solicitation of an offer to sell any securities. The exchange offers are being made only pursuant to an offering memorandum and related consent and letter of transmittal and only to such persons and in such jurisdictions as is permitted under applicable law.
SOURCE iStar Financial Inc. -0- 10/02/2006 /CONTACT: Catherine D. Rice, Chief Financial Officer, or Andrew G. Backman, Vice President, Investor Relations, both of iStar Financial Inc., +1-212-930-9400/ /Web site: http://www.istarfinancial.com / (SFI) CO: iStar Financial Inc. ST: New York IN: FIN SU: OFR EM -- NYM186 -- 3676 10/02/2006 15:28 EDT http://www.prnewswire.com