Globix to exchange $12.5 million 11% notes for stock as part of merger with Neon

New York, Oct. 13 - Globix Corp. said that holders of $12.5 million principal amount plus accrued interest of its 11% senior notes due 2008 have agreed to exchange them for stock as part of its merger with Neon Communications Inc.

The New York provider of managed internet infrastructure services will issue 4.55 million shares of common stock at a price of $2.75 per share for the notes, according to an 8-K filing with the Securities and Exchange Commission.

The exchange is contingent on completion of the merger.

Covered by the exchange are $3.8 million of debt held by MacKay Shields LLC, $2.2 million held by York Capital Management, $1.1 million held by Singer Children's Management Trust, $2.35 million held by Goldman Sachs & Co. and $1.25 million held by LC Capital Master Fund Ltd. All these firms hold 5% or more of Globix's stock. An additional $1.8 million of debt held by two further investors will also be exchanged.

Globix stock closed at $3.20 Wednesday.

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