Cornerstone Chemical begins exchange offer for 6¾% notes due 2024

By Marisa Wong

Los Angeles, Feb. 2 – Cornerstone Chemical Co. has begun a private offer to exchange any and all of its $450 million outstanding 6¾% senior secured notes due 2024 (Cusip: 21925AAE5, U20817AC3) for up to $450 million aggregate principal amount of new notes, according to a press release.

In conjunction with the exchange offer, Cornerstone is soliciting consents from holders of the existing notes to effect some proposed amendments to the indenture governing the notes. The proposed amendments would, among other things, permit the incurrence of a new $25 million senior secured loan, the payment of a dividend to some shareholders, to release the collateral with respect to the existing notes and to eliminate substantially all of the restrictive covenants and events of default and related provisions under the indenture.

Cornerstone is offering a total consideration of $1,000 of new notes for each $1,000 of existing notes tendered for exchange. The total consideration includes an early participation premium of $50 of new notes for each $1,000 of existing notes tendered by the early participation deadline.

Holders tendering after the early deadline will only be eligible to receive the exchange consideration of $950 of new notes per $1,000 of existing notes.

Holders whose notes are accepted for exchange will not receive any additional consideration in respect of accrued interest, additional interest or any other amount owned, the company noted.

The exchange offer and consent solicitation are conditioned on the tender of at least 75% of the aggregate principal amount of the existing notes.

Some beneficial owners of the existing notes representing about 92% of the principal amount outstanding have entered into a transaction support agreement, agreeing to support the exchange offer and deliver consents.

The early participation deadline is 5 p.m. ET on Feb. 14, which is also the withdrawal deadline.

The offer expires at 11:59 p.m. ET on March 1.

Settlement is expected to be on March 3.

Based in Waggaman, La., Cornerstone is a producer of intermediate chemicals, including acrylonitrile, melamine, sulfuric acid and other products.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.