Hayes Lemmerz reaches agreement on reorganization; bank lenders to get $454 million in cash

By Carlise Newman

Chicago, April 9 - Hayes Lemmerz International Inc. and its prepetition creditors have reached an agreement on a reorganization plan and set a confirmation hearing for May 7.

Under the terms of the new plan, holders of senior note claims will receive $13 million in cash and 44.9% of the new common stock, and holders of unsecured claims will receive 2% of the new common stock.

Holders of prepetition secured claims will receive $453.5 million in cash, $25 million in new senior notes and 53.1% of the new common stock.

The court also approved the company's revised solicitation procedures which allow a limited number of creditors, whose recoveries are impacted by changes in the modified plan, to vote on the plan. The new voting deadline for the creditors is anticipated to be May 2.

Over 85% of secured lenders voted in favor of the modified plan. With only limited exceptions, these votes are irrevocable and with the favorable votes previously received from other creditors, increase the likelihood that the modified plan will be confirmed on May 7.

"We are pleased that our creditors reached a quick, equitable resolution of their issues. We look forward to completing the final phase of our reorganization and are on track to emerge during the first half of 2003, which has been our goal throughout the restructuring," said Curtis J. Clawson, chairman and chief executive officer, in a news release.

Hayes Lemmerz is a Northville, Mich.-based automotive parts manufacturer.

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