Riverwood terminates 10 7/8% '08 and 10 5/8% '07 note tender offers

Riverwood International Corp. (B2/B) and its affiliated holding company, Riverwood Holding Inc., said on Friday (Sept. 6) that they had terminated their previously announced tender offers for Riverwood International's outstanding 10 7/8% senior subordinated notes due 2008 and its 10 5/8% senior notes due 2007, which had been scheduled to expire at 5 p.m. ET that day.

Riverwood noted that consummation of each tender offer had been subject to certain conditions, including the completion of the proposed initial public offering of common stock of Riverwood Holding. It said the tender offers and the related consent solicitations were terminated as a result of current equity market conditions affecting the timing of the proposed IPO. While Riverwood Holding continues to pursue its proposed IPO - subject to market conditions - the company warned that it could give no assurance that the proposed IPO would be completed.

Notes which had been tendered under terms of the tender offers will be promptly returned to their tendering holders or, in the case of notes tendered by book-entry transfer, will be credited to the account maintained at The Depository Trust Company from which those notes were delivered. As a result of the termination of the tender offers and the related consent solicitations, the proposed amendments to the indenture for each series of notes will not become operative.

AS PREVIOUSLY ANNOUNCED, Riverwood Holding, an Atlanta Ga.-based paperboard maker and the corporate parent of Riverwood International Corp., filed a registration statement with the Securities and Exchange Commission on May 3 for an initial public offering of $350 million of its common stock, and said it would also take out an additional term loan under its credit agreement and sell senior notes. Riverwood said the proceeds of the stock, bank loan and note sales would be used to repay its outstanding senior notes and senior subordinated notes and part of the borrowings on its revolving credit facility. Riverwood did not at that time disclose the size of the new term loan or the note offering, although the registration statement disclosed that the outstanding notes which it plans to redeem have a total principal amount of $900 million, consisting of $400 million 10 7/8% senior subordinated notes due 2008 and $500 million 10 5/8% senior notes due 2007. Riverwood also had $250 million of 10¼% senior notes due 2006 outstanding, which were to be redeemed on May 23, using the proceeds of a new $250 million term B loan drawn on April 23, along with $12 million drawn on the existing revolving credit facility (the new money borrowed totaled more than $250 million because of fees, costs and expenses). Riverwood did not disclose underwriters for the prospective note offering or the banks for the new loan.

On May 30, Riverwood said that it had begun cash tender offers for all of its outstanding 10 7/8% and 10 5/8% notes (the latter consists of two separate tranches, one issued in July 1997 and the other in June 2001). The company also began soliciting noteholder consents to proposed amendments to the notes' indentures, which would have eliminated substantially all of the restrictive covenants, certain repurchase rights and certain events of default and related provisions contained in such indenture. The company initially set 5 p.m. ET on June 14 as the consent solicitation deadline IF Riverwood had made a public announcement at least one day prior to that date that it had received the requisite consents for each such issue of notes; otherwise, the consent solicitation expiration would be on the first date after June 14 on which Riverwood will have received such consents the day before and will have made a public announcement regarding such receipt. It also set 12 midnight ET on June 26 as the tender offer expiration; the consent and expiration deadlines were subsequently extended.

Riverwood set the tender offer consideration for validly tendered 2007 senior notes at $1,053.13 per $1,000 principal amount of the notes, and set it at $1,040.78 per $1,000 principal amount for the 2008 senior subordinated notes, with all holders also eligible to receive accrued and unpaid interest up to - but not including - the payment date for the notes. It said that noteholders validly consenting to the proposed amendments on or before the consent expiration deadline would be entitled to a consent payment in the amount of $2.50 per $1,000 principal amount. Holders tendering their notes on or before the consent expiration date would be obligated to consent to the related proposed amendments, while holders consenting to the amendments would be required to tender their notes in the related offer and could not revoke their consent without withdrawing the tendered notes. Holders tendering their notes after the applicable consent expiration date would not be entitled to receive the consent payment. Tendered notes could be withdrawn and related consents could be revoked at any time on or prior to the consent expiration date for the related offer, but not after that. Riverwood said that it was making a separate offer each issue of notes, and no offer would be conditioned on the consummation of any other offer.

Completion of each offer would be subject to certain conditions, including (1) the consummation of the proposed initial public offering of common stock by Riverwood's corporate parent, Riverwood Holding Inc., and the consummation of certain other anticipated financing transactions, in each case on terms satisfactory to Riverwood, and (2) the receipt of the requisite consents to the proposed indenture amendments and the execution of the related supplemental indentures.

On June 12, Riverwood said that it had extended the expiration and consent deadlines on the tender offers, as well as the related consent solicitations. The deadlines for the respective tender offers for the notes were extended to 5 p.m. ET on July 12, subject to possible further extension, from the originally announced deadline of 12 midnight ET on June 26. On June 27, Riverwood said that it had received the requisite amount of noteholder consents to the proposed indenture changes from the holders of its outstanding 10 7/8% senior subordinated notes due 2008 and its 10 5/8% senior notes due 2007 as of the close of business on Wednesday (June 26), as part of its previously announced tender offers for the notes. As of that deadline, Riverwood had received tenders of approximately $225.7 million of the $400 million outstanding principal amount of the 10 7/8% notes; it had received tenders of approximately $162.1 million of the $250 million outstanding principal amount of the 10 5/8% notes issued in July 1997, and approximately $128.6 million of the $250 million outstanding principal amount of the 10 5/8% notes issued in June 2001. Riverwood said that under the terms of the consent solicitations each consent solicitation would thus formally expire at 5 p.m. ET on June 28 and that each holder validly consenting to the proposed amendments by that time would be eligible to receive a consent payment as part of the total compensation, as previously outlined. Riverwood said that along with the trustee under each indenture it intended to execute a supplemental indenture incorporating the indenture changes promptly after the applicable consent expiration date. Each consent solicitation was meanwhile extended to 5 p.m. ET on June 28, subject to possible further extension, from 5 p.m. ET on June 14.

On July 12, Riverwood again extended the tender offers to 5 p.m. ET on Aug. 2, from the previous July 12 deadline, and gave updated information on the amount of each series of bonds which had been tendered by their holders. On July 30, Riverwood announced that it had again extended the tender offers to 5 p.m. ET on Sept. 6, subject to possible further extension, from the previous Aug. 2 deadline. Riverwood also amended the terms of the tender offers to permit the noteholders to withdraw their notes at any time prior to the applicable tender offer expiration date, as well as to provide that Riverwood would pay the applicable tender offer consideration, plus the consent payment (equal to $2.50 per $1,000 principal amount of notes tendered) to all holders tendering their notes on or before the applicable tender offer expiration date. Prior to that amendment of terms, the consent payment was payable only to holders who had tendered their notes on or before the now-passed June 28 consent expiration date, and withdrawal rights had expired on June 28. Riverwood said that a holder withdrawing its notes and not re-tendering them on or before the applicable tender offer expiration date would not receive the applicable tender offer consideration or consent payment. The company added that the tender offers were being extended and amended due to current equity market conditions affecting the timing of the proposed initial public offering of common stock by Riverwood Holding, and further said that Riverwood Holding "continues to work towards the completion of its proposed initial public offering and related financing transactions, subject to market conditions." Riverwood said that as of the close of business on July 29, it had received tenders of approximately $306 million of the $400 million outstanding principal amount of the 10 7/8% notes, unchanged from the amount which had been tendered by 5 p.m. ET on July 11, the last comparable figure available, which was announced on July 12. As of July 29, the company had also received tenders of approximately $201 million of the $250 million outstanding principal amount of the 10 5/8% notes issued in July 1997, up slightly from $200.6 million as reported on July 12, and had received approximately $206 million of the $250 million outstanding principal amount of the 10 5/8% notes issued in June 2001, down marginally from the $206.2 million announced on July 12.

Deutsche Bank Securities Inc. (call 212 469-7772) and J.P. Morgan Securities Inc. (call 800 831-2035) were the dealer managers for the tender offers and solicitation agents for the consent solicitations. MacKenzie Partners, Inc. (call 800 322-2885) was the information agent and State Street Bank and Trust Company was the depositary in connection with the offers and solicitations.

Jefferson Smurfit to issue new notes to fund 9¾% '03 notes tender

Smurfit-Stone Container Corp. said on Friday (Sept. 6) that its wholly owned indirect subsidiary, Jefferson Smurfit Corp. (U.S.) plans to issue $700 million of new 10-year senior notes in a Rule 144A private placement transaction involving qualified institutional buyers. High yield market syndicate sources indicated that the new bonds would likely price on Wednesday (Sept. 11). Net proceeds from the issuance of the new notes (after deduction of discounts and commissions, fees and other expenses associated with the sale of the Notes) will be used to repurchase up to $500 million aggregate principal amount of Jefferson Smurfit's outstanding 9 ¾% senior notes due 2003 under a previously announced tender offer and related consent solicitation, and to pay related tender fees and premiums, including consent payments. Jefferson Smurfit expects to use the remaining proceeds to fund a portion of the purchase price relating to the previously-announced acquisition of the Stevenson, Ala. mill from MeadWestvaco Corp.

The company said the new notes will be guaranteed by JSCE, Inc., a wholly-owned subsidiary of Smurfit-Stone and the sole stockholder of Jefferson Smurfit Corp. (U.S.), and will rank equally with all of the latter's other senior unsecured indebtedness. The notes will not be registered under the Securities Act of 1933, and, unless so registered, may not be publicly traded in the U.S., except under circumstances allowed by the Securities Act and applicable state securities laws. Jefferson Smurfit has agreed that after the issuance of the new notes, it will file a registration statement relating to an exchange offer for the notes under the Securities Act.

AS PREVIOUSLY ANNOUNCED, on Aug. 27, Smurfit-Stone Container, a Chicago based maker of paper packaging formerly known as Stone Container Corp. before its acquisition several years ago by Dublin, Ireland-based paper packaging maker Jefferson Smurfit Group plc., said that its Jefferson Smurfit Corp. (U.S.) subsidiary was beginning a tender offer for its $500 million of outstanding 9¾% notes, as well as a related solicitation of noteholder consents to proposed indenture changes, which would eliminate substantially all restrictive covenants and certain event of default provisions. The tender offer was undertaken as part of a previously announced larger series of transactions which will see Smurfit-Stone Container Corp.'s parent company sold to U.S. equity investment firm Madison Dearborn Partners Inc. for $3.6 billion. As part of that transaction, Jefferson Smurfit Group will spin off its 29.3% stake in Smurfit-Stone Container.

The company set a consent deadline of 5 p.m. ET on Sept. 6, and said the tender offer would expire at 5 p.m. ET on Sept. 24, with both deadlines subject to possible extension. Smurfit-Stone said it would set the consideration to be paid for the notes based on a 75 basis-point fixed spread over the yield of the reference security, the 5½% U.S. Treasury Note due March 31, 2003. The total consideration payable to those holders who tender their notes by the consent deadline will include a $30 per $1,000 principal amount consent fee (which will not be payable to holders tendering their notes after the consent deadline). All noteholders will also receive accrued interest on their notes up to the settlement date. The tender offer will be conditioned upon - among other things-the satisfaction of a requisite consents condition and a financing condition, each of which is described in more detail in the official Offer to Purchase and Consent Solicitation Statement.

Morgan Stanley (call 877 445-0397 or 800 223-2440, ext. 2492) is the dealer-manager for the tender offer. D.F. King &Co., Inc. (bankers and brokers call collect 212 269-5550, others call toll-free 800 714-3312) is the information agent; international inquiries should be directed to D.F. King (Europe) Ltd. at (44 207) 920-9700.

Doe Run Resources extends, modifies exchange and tender offers for notes

The Doe Run Resources Corp. (Ca/D) said on Thursday (Sept. 5) that it had extended the expiration time of its previously announced offers to exchange new notes plus a cash accrued interest payment for its outstanding 11¼% series B senior secured notes due 2005, its outstanding 11¼% series B senior notes due 2005 (C/D) and its outstanding series B floating interest rate notes due 2003, its previously announced concurrent cash tender off for those three series of notes, its previously announced exchange/loan offer related to the notes, and the previously announced related solicitation of noteholder consents to proposed changes in the indentures governing those notes. Those offers were extended to 5 p.m. ET on Sept. 20, subject to possible further extension, from the previous Sept. 6 deadline.

Doe Run also announced that it had reached an agreement in principle with Regiment Capital Advisors, LLC, a holder of a substantial amount of the outstanding existing notes, concerning the modification of the terms of its existing offers. Under terms of the modifications, the cash offer and senior loan participation will each be eliminated. The exchange offer will meanwhile be amended to give each exchanging holder of the senior notes due 2005 and the floating interest rate senior notes due 2003 $560 principal amount of the newly issued exchange notes per $1,000 principal amount of the existing notes successfully exchanged, and to give each exchanging holder of the senior secured notes due 2005 $660 principal amount of the new exchange notes per $1,000 principal amount of the existing notes successfully exchanged. Each holder of existing notes is to also receive a pro-rata share of warrants exercisable for an aggregate of 40% of the outstanding common stock of Doe Run, assuming the participation by the holders of all of the outstanding existing notes. The warrants would be allocated to exchanging noteholders according to the percentage that the existing notes successfully tendered for exchange by each holder bears to the aggregate amount of all of the existing notes outstanding.

Doe Run also said that the previously announced Senior Loan connected with the company's restructuring will be in an aggregate amount of $15.5 million, will mature thirty months from the closing of the transaction, will bear interest at an annual 11¼% rate, will not require any amortization payment until maturity and all warrants previously associated with the Senior Loan have been eliminated. It further said that the minimum tender that will be required to effectuate the revised exchange offer will be 95% of each series of existing notes outstanding.

The company said that the new exchange notes will mature on Nov. 1, 2008, and will bear interest payable semiannually as follows: Through calendar year 2005, interest may be paid, at the sole option of Doe Run, at the annual rate of either 3% in cash and 11% paid in kind [i.e., in additional notes] OR 8% paid solely in cash. For all interest payment dates after calendar year 2005 and until the exchange notes mature, interest will be payable semiannually, and only in cash, at the annual rate of 11¼%. It said that the collateral securing the Senior Loan and the exchange notes will be substantially similar to that previously set forth in the official Offering Memorandum.

Doe Run said that to the best of its knowledge, holders of approximately 95% of the aggregate amount of the outstanding existing notes have to date tendered their notes for participation in the existing offers. Holders who desire to tender their notes into the revised exchange offer and consent solicitation must fill out new Letters of Transmittal and can get information on the procedure from the information agent for the offer or from their broker, dealer, commercial bank or trust company.

AS PREVIOUSLY ANNOUNCED: On April 15, The Doe Run Resources Corp, a St. Louis-based metals smelting company, announced that it had reached an agreement in principle with its corporate parent, New York-based industrial conglomerate The Renco Group, Inc. and with Regiment Capital Advisors, LLC, under which Renco and Regiment would provide Doe Run with significant capital that would enable Doe Run to restructure its existing debt. Under that agreement in principle, Renco said it would purchase $20 million of Doe Run preferred stock and Regiment - already a significant holder of Doe Run's 11¼% senior and senior secured notes and its floating interest rate notes - said it would commit to lend Doe Run $35 million, and would offer other holders of Doe Run notes the opportunity to participate in making such loan. Doe Run said it planned to make a cash tender offer for a portion of its notes, and an exchange offer for the balance of the notes. The $55 million in proceeds of the Renco investment and the Regiment loan would be used to finance the cash tender offer, to pay the accrued interest as of March 15 on the notes that would be exchanged in the exchange offer, and to pay certain costs of those transactions. Doe Run said that if they were successful, the cash tender offer and the exchange offer would significantly reduce its outstanding debt. Doe Run would meanwhile be able to continue to operate all its facilities at present levels and Doe Run's trade creditors would not be adversely affected.

Besides the $20 million investment, Renco would also provide Doe Run with credit support of up to $10 million, if necessary, to provide additional working capital. Doe Run said the non-binding agreement in principle would be subject to agreement on the terms of definitive documentation and further said that the successful completion of the planned transactions would be subject to several conditions, including, among others, the participation by holders of 90% of the principal amount of each class of notes in the cash tender offer and/or the exchange offer (Doe Run originally issued $200 million of the 11¼% senior notes, $50 million of the 11¼% senior secured notes and $55 million of the floating rate notes). It would also be conditioned upon the satisfactory modification of Doe Run's U.S. and Peruvian revolving credit facilities. Doe Run said it anticipates the completion of definitive documentation for the Regiment loan and the Renco investment within 30 days of its press release, at which time more detailed terms would be announced and the cash tender offer and exchange offer would be commenced.

On May 16, Doe Run outlined the terms of the agreement in principal and announced its tender offer and exchange offer for the notes in an 8-K filing with the Securities and Exchange Commission. The company did not initially disclose expiration deadlines for either offer nor did it disclose deadlines for the related consent solicitations. Doe Run said that under the terms of its exchange offer, it would offer the holders of its outstanding 11¼% senior secured notes $770 per $1,000 principal amount of the notes in new Doe Run 11¼% exchange notes due 2007, plus a cash payment of $56.25 per $1,000 principal amount equal to the amount of accrued and unpaid interest through March 15. It would offer the holders of its existing 11¼% senior notes $670 per $1,000 principal amount of the notes in new exchange notes, plus the $56.25 per $1,000 principal amount interest payment, and it would offer the holders of the existing floating-rate notes $670 per $1,000 principal amount of the notes in new exchange notes, plus an accrued interest payment of $46.90 per $1,000 principal amount. Doe Run said the exchange offer would be open only to those holders who could reasonably be defined as Accredited Investors under Rule 501(a) of the Securities Act of 1933. Doe Run said that simultaneously with the exchange offer, it would begin a cash tender offer for the outstanding notes, under which it would offer to buy the notes at a price between $250 and $350 per $1,000 principal amount. Doe Run said that it would select as the cash payment the highest price specified by any noteholder that would enable the company to purchase the maximum amount of notes while not exceeding its target aggregate purchase price of $44 million. Doe Run said it would pay the same cash payment for all of the notes validly tendered at or below that cash payment price and not subsequently withdrawn, upon the closing of the transaction. It said that holders whose notes were accepted for purchase under the cash tender offer would not be eligible to receive any interest payment on them above the cash payment price. Any holder tendering notes under the cash tender offer would also be considered to have tendered them under the exchange offer as well. Should the amount of notes tendered under the cash tender offer and not subsequently withdrawn exceed the amount that the company would be able to buy and still stay within its available cash aggregate purchase price of $44 million, Doe Run would first accept for payment all notes tendered below that cash payment price and would then accept notes tendered at the cash payment price on a pro-rata basis. Any notes thus tendered under the cash tender offer which could not be purchased for cash would then be exchanged for the appropriate amount of new exchange notes and the appropriate cash interest payment. Doe Run said that should a holder choose to neither tender his existing notes under the exchange offer nor the cash tender offer, it reserves the right to leave such unexchanged or unpurchased notes outstanding upon the conclusion of its offers; it also, however, reserves the right (but is under no obligation) to subsequently purchase such notes as permitted under the terms of its new senior credit facility either on the open market or in negotiated transactions, either for similar or for different consideration as it is offering under the exchange offer and the cash tender offer. It also reserves the right to defease the remaining outstanding notes or to redeem them under the terms of their indentures. Any remaining outstanding notes will be subject to indenture changes for which Doe Run is seeking noteholder consent concurrently with its exchange and cash tender offers. Doe Run said the tender of notes under either the exchange offer or the cash tender offer would be considered to constitute noteholder consent to the proposed indenture amendments, which would eliminate substantially all of the restrictive operating and financial covenants in the indentures, and which would modify a number of the "event of default" provisions, and various other provisions currently contained in the existing notes' indentures.

Doe Run also said that in connection with the offers, it would enter into a new $37.5 million, four-year senior secured credit facility with Regiment Capital Advisors, and that it would offer noteholders who initially elect to participate in the exchange offer the opportunity to participate as co-lenders under the New Senior Credit Facility on a pro-rata basis, based upon those noteholders' respective interests in the existing notes initially tendered in the exchange offer. The participation of the noteholders as co-lenders will be subject to Regiment's right, in its sole and absolute discretion, to lend at least 60% of the aggregate principal amount of the Initial Senior Loan. Each noteholder who elects to participate in the Initial Senior Loan will also participate as a co-lender in any subsequent senior loan approved by Doe Run's existing lenders on a pro- rata basis, in accordance with such noteholder's percentage interest in the Initial Senior Loan. The proceeds of the Initial Senior Loan will be used to consummate the exchange offer and the cash tender offer. Noteholders choosing to participate in the Initial Senior Loan will receive warrants exercisable for up to 20% of the fully diluted common stock of Doe Run, at an initial total exercise price of $2,000,000. The warrants would be distributed to the participating noteholders on a pro-rata basis in accordance with such participant's interest in the Initial Senior Loan. Doe Run said that consummation of the cash tender offer and the exchange offer, as well as related transactions, would be conditioned upon a number of conditions including - but not limited to - the valid tender (without subsequent withdrawal) of at least $125 million total principal amount of the existing notes under the cash tender offer; the participation by 90% of the outstanding principal amount of each of the three series of existing notes in the exchange offer and/or the cash tender offer; and the receipt of the requisite consents to the proposed indenture changes. Doe Run said it expected to launch the tender offer and exchange offer by the last week of May, and warned that there could be no assurance that it would be able to successfully complete the transactions described.

On June 6, Doe Run said in an SEC filing that it had begun an offer to exchange new notes plus a cash accrued interest payment for its outstanding 11¼% senior and senior secured notes due 2005, and its outstanding floating interest rate notes due 2003; had begun a concurrent cash tender off for those three series of notes; and had begun a related solicitation of noteholder consents to proposed changes in the indentures governing those notes. Doe Run said it was also offering noteholders choosing to participate in the exchange offer the option of also participating in its new senior credit facility as co-lenders. It outlined terms of the offers that were the same as those which Doe Run had already outlined in a previous SEC filing. In its latest filing, the company also said that the exchange offer, the cash tender offer and the right of participation in the senior loan would each expire at 5 p.m. ET on July 9, subject to possible extension. Tendered notes could be withdrawn at any time prior to the expiration date.

On July 9, Doe Run extended the pending exchange offer, the cash tender offer and the consent solicitation to 5 p.m. ET on July 19, and said that it was providing updated projected financial information. The company further reported that it had been engaged in "constructive discussions" with holders of a "significant amount" of its notes, and said it was extending the expiration time of the offers and providing the updated projected financial information "as an aid to further discussion of the Offers."

On July 19, Doe Run said that it had further extended its exchange offer for its 11¼% senior and senior secured notes due 2005 and its Series B floating interest rate notes due 2003, its concurrent cash tender off for those three series of notes and solicitation of noteholder consents to 5 p.m. ET on Aug. 2, subject to possible further extension, from the previous July 19 deadline. The company also amended the terms of the aforementioned offers to - among other things - allow its noteholders the ability to elect to participate in a third offer, "the Exchange/Loan Offer," in addition to participating in the previously described cash tender offer or exchange offer. It said that holders who participate in this "Exchange/Loan Offer" will be able to exchange their notes for a participation interest in the Initial Senior Loan which the company, as previously announced, is entering into as part of its overall recapitalization. Doe Run said that it was extending the expiration time of the offers to allow noteholders to consider participating in such an additional offer. Doe Run also said it was amending the terms of the exchange notes which noteholders could elect to receive as part of either the exchange offer or the newly announced "Exchange/Loan Offer" to include, among other things, the provision of a required 1% per annum cash interest payment on each of the first two interest payment dates (as opposed to the previously outlined provision contained in the "Description of Exchange Notes" found in the official Offering Memorandum, which indicated that such interest payments could be paid in full "in kind" (i.e., through the issuance of additional notes, with no cash component). Doe Run further announced that in addition to the inclusion of the new "Exchange/Loan Offer," it has amended the previously outlined terms of its "New Senior Credit Facility" (including the "Subsequent Senior Loan Participation") and its exchange notes to be issued to holders of its current notes successfully participating in the exchange offer. Doe Run said that as amended, the New Senior Credit Facility will consist of the "Initial Senior Loan" in the amount of $35.7 million and a Subsequent Senior Loan in the amount of $25 million, $10 million of which will be committed by Regiment Capital Advisors, LLC at closing to provide Doe Run with additional working capital under certain circumstances in the future. The balance of the Subsequent Senior Loan is to be funded at the request of Doe Run subject to the consent of the lenders. The Renco Group, Inc., ultimate parent of Doe Run, has agreed to take a participation interest in $5 million of the aforementioned $10 million "Regiment Credit Support." Holders of Doe Run's currently outstanding notes who participate in the Initial Senior Loan will have the option - but not the obligation - to participate in the Subsequent Senior Loan. Noteholders who have already tendered their notes into the cash tender offer or the exchange offer will have the right to withdraw or amend such tenders; noteholders who wish to tender their notes into the new "Exchange/Loan Offer" must transmit a completed Letter of Transmittal for such offer to the depositary and exchange agent for the offers.

On Aug. 2, Doe Run said that it had extended the exchange offer, the concurrent cash tender offer and the related consent solicitation to 5 p.m. ET on Aug. 6 from the previous Aug. 2 deadline. Doe Run also said that it has received "overwhelming support" for the offers from holders of all three categories of notes. Doe Run said that although, to the best of its knowledge, holders of approximately 95% of Doe Run's aggregate principal amount of notes outstanding had chosen to participate in the offers, as of the old deadline, approximately 86% of the floating rate notes had been tendered for participation in the offers, still less than the 90% minimum tender required for consummation of the offers; therefore, the company said it was extending the expiration time of the offers in order to continue discussions with John Hancock Funds, Triton Partners LLC and Hawkeye Capital, LP concerning the participation by those entities with respect to the floating-rate notes which those companies hold. Doe Run cautioned that there could be "no assurance that [it] will be able to consummate the Offers successfully."

On Aug. 7, Doe Run said that it had extended its exchange offer, the concurrent cash tender offer and the related consent solicitation to 5 p.m. ET on Aug. 14 from the previous Aug. 6 deadline. Doe Run also said that it was amending the minimum tender condition with respect to the 2003 floating-rate notes, reducing it to 86% from 90% previously. The minimum tender conditions for the other two series of notes - which had previously been achieved - remains 90%. With the amendment regarding the floating-rate notes, Doe Run said the minimum tender required for the consummation of the offers had now been achieved.

On Aug. 14, Doe Run said that it was again extending its offers to 5 p.m. ET on Aug. 20, subject to possible further extension, from the previous Aug. 14 deadline. The company said that although it had already received tenders of notes sufficient to satisfy the previously announced minimum tender conditions required for the consummation of the offers, with holders of 95% of the aggregate principal amount of its outstanding notes having participated, it was nonetheless extending the offers to allow it to continue discussions with its working capital lenders regarding the terms of its Amended and Restated U.S. Revolving Credit Facility. On Aug. 21, Doe Run again extended the expiration of the offers to 5 p.m. ET on Aug. 23, subject to possible further extension, from the previous Aug. 20 deadline. The company said that it had reached a tentative agreement on its proposed restructuring with its working capital lenders, and had extended the offers to allow it to finalize the terms of its Amended and Restated U.S. Revolving Credit Facility and to complete the required definitive documentation.

On Aug. 23, Doe Run said that it was again extending the expiration time of its exchange offers, concurrent tender offers, senior loan participation offer and related consent solicitations to 5 p.m. ET on Sept. 6, subject to possible further extension, from the previous Aug. 23 deadline. The company said that although Doe Run had received tenders from holders representing 95% of the aggregate outstanding amount of its notes - an amount sufficient to satisfy the minimum tender conditions required for consummation of the offers in their current form - it would have to attempt to restructure the offers. Doe Run said that continuing market price erosion of Doe Run's primary product, lead metal, had resulted in a decline in the company's available liquidity. It said that prices had failed to recover to the extent forecast by Doe Run in the original June 6 official offering memorandum setting forth the offers, and in subsequent company documents. Doe Run said that the company and corporate parent therefore had come to the conclusion that consummating the offers in their current form would not provide adequate liquidity to Doe Run, and said that they were discussing a restructuring of the offers with Doe Run's U.S. working capital lenders and bondholders. State Street Bank and Trust Co. in Boston (call 617 662-1548 or fax documents to 617 662-1452) is the exchange agent and the depositary for the offers. MacKenzie Partners, Inc. (call 212 929-5500 or, toll-free, 800 322-2885) is the information agent.

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