Small draw for Ion tender


Only 25.3% of the 14.25% preferred shares and 10.6% of the 9.75% preferred shares were tendered for the exchange offer at Ion Media Networks, so the "minority exchange consideration" will apply. However, Ion has also given preferred holders another chance to change their minds, with the exchange deadline extended to midnight on Friday, July 27th.

Ion won a round in court last week allowing it to complete the exchange offer (7/12/07 TVBR #135). Preferred shareholders who had gone to the Delaware Chancery Court to arguer that the exchange offer was unfair and coercive have now filed to appeal the court's refusal to block Ion's offer.

Since less than 50% of each issue was tendered, here is what the preferred shareholders who tendered for the exchange will receive: For each tendered share of 14 1/4% Preferred Stock, the holder will receive 7,500 bucks principal amount of 11% Series A Mandatorily Convertible Senior Subordinated Notes due 2013 (the "Series A Notes") and 500 initial liquidation preference of 12% Series B Mandatorily Convertible Preferred Stock (the "Series B Convertible Preferred Stock"), which will rank junior to any unexchanged Senior Preferred Stock; and for each tendered share of 9 3/4% Preferred Stock, the holder will receive 4,500 principal amount of Series A Notes and 500 initial liquidation preference of Series B Convertible Preferred Stock.

Withdrawal rights will continue to apply during the exchange offer extension, so holders who do not wish to receive the Minority Exchange Consideration may withdraw their previously tendered shares and revoke their consents.