Arch Wireless redeems portion of 10% '07 notes, slates further redemption

Arch Wireless, Inc. said on Friday (Aug. 30) that its wholly owned Arch Wireless Holdings, Inc. subsidiary had completed the previously announced redemption at par of $15 million of its 10% senior subordinated secured notes due 2007, plus accrued interest. It said that with the redemption, the second in recent weeks, Arch now had $175 million principal amount of the 10% notes outstanding, and said that it had given The Bank of New York notice of its intention to redeem another $15 million of the notes on Sept. 30. Only holders of record as of Sept. 16 could participate in the transaction.

AS PREVIOUSLY ANNOUNCED, Arch Wireless - a Westborough, Mass.-based provider of wireless messaging and mobile information services - said on May 29 that its First Amended Joint Plan of Reorganization, which had been confirmed by the U.S. Bankruptcy Court for the Western Division of Massachusetts on May 15, officially became effective, thus marking the formal emergence from Chapter 11 of Arch and its subsidiaries. As part of that reorganization, Arch Wireless Holdings issued $200 million principal amount of new 10% notes and $100 million principal amount of new 12% subordinated secured compounding notes due 2009, while the parent company issued 20 million shares of new common stock. The new shares and notes were issued in full satisfaction, release, discharge and cancellation of all claims against Arch and its subsidiaries based on transactions or occurrences prior to last Dec. 6. All previously outstanding equity securities, including common stock and preferred stock, and all options and other rights to acquire Arch securities were cancelled.

On July 8, Arch Wireless said that Arch Wireless Holdings had given notice of its intention to redeem $10 million principal amount of its 10% notes. Arch said that it expected to redeem the notes on July 31. It said the redemption transaction would be handled by the notes' trustee, The Bank of New York. Arch said that under terms of the notes' indenture, only holders of record as of July 16 would be entitled to receive cash distributions in connection with the redemption. Arch warned that creditors that had not yet tendered their letters of transmittal to The Bank New York in accordance with Arch's Joint Plan of Reorganization would not receive a cash distribution in connection with the redemption, unless their letter of transmittal were to be received by the exchange agent by July 15. Accordingly, Arch said it "strongly" urged all such creditors to submit their transmittal letters prior to July 15. Arch said that early redemption of that portion of the 10% notes - this in addition to recent exchange transactions undertaken as part of its overall financial reorganization - would further lower the company's interest expense and generate greater financial flexibility.

On July 31, Arch Wireless said that its subsidiary had completed the previously announced redemption, at par value, of $10 million of 10% notes, plus accrued interest. It said that with the redemption, Arch now had $190 million principal amount of the 10% notes outstanding, and said that it had given The Bank of New York notice of its intention to redeem another $15 million of the notes on Aug. 30. Only holders of record as of Aug. 15 could participate in the transaction. Arch said that creditors that had not yet tendered their letters of transmittal to The Bank New York would not be eligible to receive a cash distribution in connection with the Aug. 30 redemption unless such letters of transmittal had been received by the exchange agent by Aug. 14.

Lexington Precision extends exchange offer for 12¾% notes

Lexington Precision Corp. said on Friday (Aug. 30) 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 12 midnight ET on Sept. 30, subject to possible further extension, from the previous Aug. 30 deadline.

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 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 12 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 10½% 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 12¾% 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, subject to possible further extension.

InfoUSA buys back $1 million 9½% '08 notes

InfoUSA (B3) said on Thursday (Aug. 29) that it repurchased $1 million of its 9.5% notes due 2008, the third such repurchase that the company has made so far this year and the second such repurchase in as many weeks. It said that so far in 2002, it has repurchased a total of $5 million of the bonds. The company expressed its commitment to "aggressively" de-leveraging the company and using its excess cash flow to pay down long-term debt obligations.

AS PREVIOUSLY ANNOUNCED, InfoUSA, an Omaha, Neb.-based provider of proprietary business and consumer databases and sales and marketing solutions, said on June 21 that it had made a $5 million interest payment on the 9½% notes. It also said that it had bought back $2 million of the notes in April, bringing the amount of notes bought back since the bonds were issued in June 1998 to $11 million, out of the $115 million of bonds that were originally outstanding. Since the bonds' issuance, InfoUSA said, it has made interest payments totaling $40.8 million. It attributed its ability to make the June interest payment and its previous payments in a timely manner to its continued strong cash flow, and added that subject to market conditions, it planned to retire additional bonds "throughout the year."

On Aug. 22, InfoUSA said that it repurchased $2 million of its 9.5% notes, the second such repurchase that the company had made so far this year. It said that so far in 2002, it had repurchased a total of $4 million of the bonds. InfoUSA also said that it had also made principal payments totaling $14.6 million so far this year on its senior credit facility. InfoUSA said that since the facility was originated in July 1999, it had made accumulated prepayments of $57.8 million on the facility.

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