AutoZone To Tender For Chief Auto Parts
24 July 1998
AutoZone To Tender For Chief Auto Parts 10 1/2% Senior Notes
MEMPHIS, Tenn., July 24 -- AutoZone Inc. ,
announced today that it has commenced a tender offer and consent solicitation
for any and all of the outstanding 10 1/2% Senior Notes due 2005 of its wholly
owned subsidiary Chief Auto Parts Inc. ("Notes").
The tender offer and consent solicitation are subject to the terms and
conditions in AutoZone's Offer to Purchase and Consent Solicitation Statement
dated July 24, 1998. The tender offer will expire at 5 p.m., New York City
time, on Friday, August 21, unless extended (the "Expiration Date"). The
consent solicitation will expire at 5 p.m., New York City time, on Friday,
August 7, 1998, unless extended (the "Consent Date").
The principal amount of the Notes outstanding is $130,000,000. The
purchase of the Notes will be funded from AutoZone's existing lines of credit.
Holders tendering their Notes will be required to consent to certain
proposed amendments, which will eliminate certain of the restrictive
covenants, certain events of default provisions and certain other related
provisions from the indenture governing the Notes. The tender offer and
consent solicitation are conditioned on the receipt of consents from holders
of at least a majority of the principal amount of the Notes.
In the event Notes are accepted for purchase pursuant to the tender offer
and the proposed amendments to the indenture become operative, AutoZone will
make a consent payment of $15 per $1,000 principal amount of Notes for which
consents have been validly delivered on or prior to the Consent Date and not
validly revoked (the "Consent Payment").
In the event Notes are accepted for purchase pursuant to the tender offer,
the consideration for each $1,000 principal amount of Notes validly tendered
on or prior to the Expiration Date and not validly revoked shall be (i) the
price, calculated in accordance with standard market practice, based on the
assumption that the Notes will be redeemed at $1,052.50 per $1,000 principal
amount of Notes on the earliest redemption date, May 15, 2001, and that the
yield to the earliest redemption date is equal to the sum of (x) the yield to
maturity on the 5 5/8% U.S. Treasury Note due May 15, 2001, as calculated by
the Dealer Managers in accordance with standard market practice, based on the
bid side price as of noon, New York City time, on the second business day
immediately preceding the Expiration Date, plus (y) 0.45% (45 basis points),
minus (ii) an amount equal to the Consent Payment ((i) minus (ii) is referred
to herein as the "Purchase Price"). All holders who validly tender Notes prior
to the Expiration Date will also be paid accrued and unpaid interest on such
$1,000 principal amount up to but not including the date of payment for the
Notes accepted for purchase.
The Purchase Price and the Consent Payment will be paid as promptly as
practical following the Expiration Date. Holders who validly tender their
Notes and validly deliver consents on or prior to the Consent Date will
receive the Purchase Price and the Consent Payment. Holders who validly tender
their Notes and validly deliver their consents subsequent to the Consent Date
and on or prior to the Expiration Date will only receive the Purchase Price
and will not receive the Consent Payment. A holder who validly tenders Notes
will be deemed to have validly delivered its consent. A holder may not deliver
its consent without validly tendering its Notes.
AutoZone may amend, extend or terminate the tender offer and consent
solicitation at any time.
Merrill Lynch & Co. and Goldman, Sachs & Co. are the Dealer Managers.
Questions or requests for assistance may be directed to Merrill Lynch
(telephone: (888) 654-8637) or Goldman, Sachs (telephone: (800) 323-5678 ext.
0557). Requests for documentation may be directed to Beacon Hill Partners, the
Information Agent (telephone: (800) 755-5001).
AutoZone sells auto and light truck parts, chemicals and accessories in 38
states through 2,001 AutoZone stores as of May 9, 1998, plus 560 Chief stores
acquired June 29, 1998. AutoZone also sells heavy-duty truck parts through 43
TruckPro stores in 14 states and automotive diagnostic and repair software
through ALLDATA.