Lexington Precision extends exchange offer for 12¾% notes

Lexington Precision Corp. said on Friday (Jan. 31)) that it had again extended its previously announced offer to exchange new debt, plus stock-purchase warrants and a participation payment, for its outstanding 12¾% senior subordinated notes which came due in 2000 but which were not redeemed at that time. The offer was extended to midnight ET on Feb. 7, subject to possible further extension, from the previous Jan. 31 deadline.

Lexington said that as of Jan. 31, holders had tendered $27,209,125 of the notes, or 99.3% of the outstanding amount, unchanged from the amount announced on Oct. 31 and at several subsequent expiration deadline extension announcements. While that has satisfied the 99% minimum tender condition to the exchange offer, the company said that a number of other conditions have not yet been satisfied, including the completion of a new senior secured credit facility on terms satisfactory to the company.

AS PREVIOUSLY ANNOUNCED Lexington Precision, a New York-based manufacturer of rubber and metal components for the automobile and medical devices industries, said on July 10 that it had begun an exchange offer for its $27.412 million of outstanding 12¾% notes. Under the terms of the exchange, which is open only to holders of record (as of July 1) of the existing notes, the company would give them a principal amount of new 11½% senior subordinated notes due 2007 equal to the sum of the principal amount of the outstanding 12¾% notes, plus the accrued interest on those notes from Aug. 1 1999, through April 30 of this year. The company said that accrued interest would total $350.625 per $1,000 principal amount of the existing notes. If all of the outstanding existing notes were to be tendered and the exchange offer completed Lexington Precision would issue new 11½% notes to cover a total of $9.611 million of accrued interest from the existing notes.

Lexington Precision initially said that the exchange offer would expire at midnight ET on Aug. 7, although this deadline was subsequently extended. It said that interest on the new 11½% notes would accrue from May 1 of this year; interest for the three-month period ended July 31 would be paid on the issue date of the 11½% notes, and after that, would be payable quarterly on each November 1, February 1, May 1, and August 1. The company said that holders of the new 11½% notes would also receive a participation fee equal to $22.20 per $1,000 principal amount of 11½% notes issued, payable in three equal installments on Sept. 30, 2002, Dec. 31 and March 31, 2003. Lexington will also issue to the holders of the new notes warrants to purchase 10 shares of common stock per $1,000 principal amount of notes; the warrants would allow their holders to buy the stock at a price of $3.50 per share at any time during the period from Jan. 1, 2004 through Aug. 1, 2007. Prior to Jan. 1, 2004, the warrants will not be detachable from the 11½% notes and will be transferable only as part of a unit with the notes.

The company said that the exchange offer is being undertaken as part of a larger comprehensive financial restructuring plan that would also involve an extension of the company's 10 ½% senior notes and 14% junior subordinated notes, and a refinancing of the company's senior, secured credit facilities. It said that completion of the exchange offer would be subject to a number of conditions, including the refinancing of Lexington's other debt on satisfactory terms. Completion of the exchange offer would also be subject to the condition that at least 99% of the outstanding 12¾% notes be tendered for exchange and not withdrawn. The company warned that if the exchange offer is completed, it does not presently intend to pay principal or accrued interest on any untendered 12¾% notes. It further said that the exchange offer reflects an agreement in principle that it reached with the four largest holders of its 12 ¾% notes, who among them control a total of $20.49 million of the 12¾% notes, or 74.7% of the $27.412 million outstanding.

On Aug. 7, the company extended the expiration of the exchange offer to 12 midnight ET on Aug. 30, and on Aug. 30, it said that it had again extended the offer to midnight ET on Sept. 30 and said that it had received tenders of $27,131,875 of the notes, or 98.98% of the outstanding amount, just shy of the 99% minimum tender condition. On Sept. 30, Lexington announced the further extension of the offer to 12 midnight ET on Oct. 18, and said that it had received tenders of $27,208,875 of the notes, or slightly more than 99% of the outstanding amount, satisfying the minimum tender condition to the consummation of the exchange offer. On Oct. 18, the company announced the further extension of the offer to 12 midnight on Oct. 31, subject to possible further extension, and said that as of Oct. 18, some $27,209,125 of the notes, or slightly more than 99% of the outstanding amount, had been tendered.

On Nov. 1, the company announced the further extension of the offer to midnight ET on Nov. 15, subject to possible further extension, from the previous Oct. 31 deadline. It reported the same level of noteholder participation in the offer as previously. The company further announced on Nov. 14 that it was extending the offer to midnight ET on Dec. 4, with the same level of noteholder participation as previously announced. On Dec. 4, it announced that the offer had been extended to Dec. 20, with the same level of noteholder participation as previously announced. A similar announcement was made on Dec. 20, extending the offer to Jan. 10, and yet another such announcement was made on Jan. 10, extending the offer to Friday (Jan. 31).

Evercom extends exchange offer for 11% '07 notes

Evercom Inc. said on Friday (Jan. 31) that it has extended the pending exchange offer for up to all of its outstanding 11% senior notes due 2007, which is part of the previously announced effort to restructure the company's balance sheet. Holders are exchanging their debt for almost all of the restructured company's equity.

Evercom said that the exchange offer, which began on Dec. 24 (no public announcement of the offer was made at that time), will expire at 5 p.m. ET on Feb. 5.

It said that as of Jan. 31, approximately 91% of the $115 million of outstanding notes have been tendered for exchange, although the tender of the notes may be revoked, in accordance with the terms and conditions of the exchange offer, prior to the expiration of the exchange offer.

The Bank of New York (call 212 815-5788, attention William Buckley) is the exchange agent for the offer.

AS PREVIOUSLY ANNOUNCED: Evercom, an Irving, Texas-based provider of telecommunications services to the inmate populations at correctional facilities, said on Dec. 5 that it had reached an overall agreement in principle with its senior lenders and the ad hoc committee of subordinated bondholders on restructuring the company's balance sheet.

Evercom said that the restructuring would result in the holders of the company's publicly traded subordinated debt exchanging their debt for 98% of the equity of the restructured company. Existing equity holders would retain a 2% interest in the restructured company and have warrants to subscribe for additional equity at significantly higher prices.

Evercom said it expected to mail documents relating to the exchange offer to its bondholders in December and said it anticipates closing the transaction early this year, subject to any regulatory reviews.

The company added that following the conversion of the publicly traded bonds, its total outstanding indebtedness would be reduced to a level that could comfortably be serviced by cash flow from operations.

Massey Energy bought back 6.95% notes in quarter

Masssey Energy Co. said on Thursday (Jan. 30) that it bought back some of its 6.95% senior notes in the fourth quarter. The Richmond, Va.-based coal producer said in its fourth-quarter earnings release that it had $286 million of the notes outstanding as of Dec. 31, down from $300 million previously. It attributed the drop to having repurchased $14 million of the notes during the quarter. Massey also said that it had $264 million of outstanding short-term borrowings from its amended bank credit facility as of Dec. 31.

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