Lexington Precision extends exchange again

New York, Aug. 28 - Lexington Precision Corp. again extended its offer to exchange new units consisting of 11½% senior subordinated notes due Aug. 1, 2007 and warrants to purchase common stock for its existing 12¾% senior subordinated notes, which were to have matured on Feb. 1, 2000.

The offer now expires at midnight ET on Sept. 11, pushed back from midnight ET on Aug. 28.

As previously announced Lexington Precision, a New York-based manufacturer of rubber and metal components for the automobile and medical devices industries, began its original exchange offer for its $27.412 million of outstanding 12¾% notes on July 10, 2002.

The original expiration deadline was extended numerous times.

The original offer terms were subsequently amended; the company announced on March 7 that under the terms of the amended exchange offer, holders of the 12¾% notes would receive new 11½% senior subordinated notes due 2007, in a principal amount equal to the sum of the principal amount of 12¾% notes tendered, plus the accrued interest from Aug. 1, 1999, through the day before the date the amended exchange offer is consummated (prior to the amendment, only accrued interest through April 30, 2002, was to be converted into new 11½% notes).

It said that if the amended exchange offer were to be consummated on March 25, 2003 (it was not), the accrued interest would total $465.3750 per $1,000 principal amount of 12¾% notes tendered (up from the previously announced $350.625 per $1,000 principal amount tendered). If all of the existing 12¾% notes were to be tendered, and the exchange offer completed, $12.757 million of accrued interest would be converted into new 11½% notes (up from the previously announced $9.611 million of total accrued interest).

Lexington also said that interest on the new 11½% notes would accrue from the date the amended exchange offer is consummated, and would be payable quarterly on each May 1, August 1, Nov. 1, and Feb. 1 (prior to the amendment, interest on the new 11½% notes was to accrue from May 1, 2002).

Tendering holders of the 12¾% notes will also receive a participation fee equal to $30 for each $1,000 principal amount of 12¾% notes tendered. The participation fee will be payable in cash on the date the amended exchange offer is consummated (prior to the amendment, a participation fee of $22.20 per $1.00 principal amount of notes tendered was to be paid in three installments).

Lexington said the amended exchange offer is a component of a comprehensive financial restructuring plan that would also involve a refinancing of the company's senior secured credit facilities, the repurchase, at a discount, of the company's 10½% senior notes, an extension of the principal amount of the company's 14% junior subordinated notes, and a conversion of the accrued interest on the 14% notes to common stock (previously, the company had said that it intended to extend the 10½% notes rather than repurchase them at a discount, and made no mention of converting the 14% notes' accrued interest to common stock).

Lexington said completion of the amended exchange offer would be subject to a number of conditions, including the refinancing or retirement of all the company's debt other than the 12¾% notes on terms satisfactory to the company.

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