R. H. Donnelley begins tender for 9 1/8% '08 notes

R.H. Donnelley Inc. (B1/B+) said on Wednesday (Dec. 4) that it had begun a previously announced tender offer for all of its outstanding 9 1/8% senior subordinated notes due 2008 and a related exit consent solicitation aimed at eliminating substantially all restrictive covenants and certain events of default under the notes' indenture. It said that holders may not tender their notes without delivering consents to the indenture changes and may not deliver consents without tendering their notes.

The tender offer, which began on Tuesday (Dec. 3), is scheduled to expire at 5 p.m. ET on Jan. 2, subject to possible extension. Holders who tender their notes and deliver their consents by the consent deadline (5 p.m. ET on Dec. 16, also subject to extension) will receive total consideration equal to the tender offer purchase price of 98.5% of the principal amount of notes validly tendered plus an early consent premium equal to 1.5% of the principal amount for total consideration of par value. Holders who tender their notes and deliver their consents after the consent deadline but before the expiration will receive total consideration equal to the tender purchase price but will not receive the early consent premium. Accrued and unpaid interest will be paid on all notes that are validly tendered and accepted for purchase.

Donnelley said that completion of the tender offer is conditioned upon, among other things, the consummation of its pending acquisition of the Sprint Publishing and Advertising business and related financings.

AS PREVIOUSLY REPORTED, R. H. Donnelley Inc., a Purchase, N.Y. -based directory publishing subsidiary of R.H. Donnelley Corp., said on Nov. 25 that it was planning to make a tender offer for all $150 million of its outstanding 9 1/8% notes, and would also begin a related solicitation of noteholder consents to proposed changes in the notes' indenture.

The company said that it was anticipating that the tender offer purchase price (including any related consent payment) would be par plus accrued interest up to the date of repurchase, and that completion of the tender offer would be conditioned upon - among other things - the consummation of the pending acquisition by Donnelly of the Sprint Publishing and Advertising business and related financings.

Donnelley said that the exact terms and conditions of the tender offer and the consent solicitation would be specified in, and would be qualified in their entirety by, the tender offer and consent solicitation statement and related materials scheduled to be distributed to holders of 2008 notes.

The company further said that the offer would be financed with a portion of the expected proceeds of the parent company's $925 million two-part Rule 144A offering of senior notes and senior subordinated notes. Donnelley also said that it would use portions of the bond sale proceeds to partially finance the acquisition of the Sprint directory publishing business and to repay existing senior debt.

On Nov. 26, Donnelley was heard by high yield syndicate sources to have sold $925 million of new bonds in the previously announced two-part deal, a portion of the proceeds of which would be used to finance the tender offer for the 9 1/8% notes.

AES extends exchange offer for '02, '03 notes

The AES Corp. (B3/B+) said on Wednesday (Dec. 4) that it had extended its previously announced offer to exchange a combination of cash and new senior secured securities for up to $500 million of senior notes scheduled to come due in 2002 and 2003.

The company said that the offer, which had been scheduled to expire at 5 p.m. ET on Tuesday (Dec. 3), would be extended to 5 p.m. ET on Friday (Dec. 6), subject to possible further extension.

It said that it had been informed by the exchange agent for the offer that, as of the old deadline, approximately $230.074 million of its 8¾% senior notes due 2002, or about 77% of the notes outstanding, had been tendered, along with approximately $172.859 million in aggregate principal amount of its 7 3/8% remarketable and redeemable securities - ROARS - due 2013, or 86% of the outstanding amount. Holders of the ROARS have thus achieved the 80% minimum tender condition, while the condition has not yet been met for the 2002 notes.

AS PREVIOUSLY ANNOUNCED, AES, an Arlington, Va.-based global independent power producer said on Oct. 3 that it had begun an offer to exchange the cash and new debt for its $300 million of outstanding 8¾% notes and its $200 million of outstanding 7 3/8% ROARS, which are putable in 2003.

AES said it would exchange $500 in cash and $500 principal amount of a new issue of 10% senior secured notes due 2005 per $1,000 principal amount of the existing 2002 notes( this mix was subsequently altered), and would exchange $1,000 principal amount of the new 10% notes per $1,000 principal amount of the ROARS. It additionally said it would pay an early tender bonus payment of $15 per $1,000 principal amount of the 2002 notes tendered and $5 per $1,000 principal amount of the ROARS tendered to holders who tender their notes prior to the early tender deadline (originally 5 p.m. ET on Oct. 25, which was subsequently first extended, then waived, then restored, then waived again) and who do not subsequently withdraw such securities, assuming the exchange offer is consummated.

It said the exchange offer would expire at 5 p.m. ET on Nov. 8 (this deadline was subsequently extended). Tenders of the 2002 notes and the ROARs could be withdrawn at any time prior to the later of the early tender deadline and the time that AES announces that it has received valid and unwithdrawn tenders representing at least 75% in aggregate principal amount of the 2002 notes and the ROARS on a combined basis (the minimum participation percentages were later changed). In no event shall the latter time be later than the announced expiration date.

The company said that consummation of the exchange offer would be subject to a number of significant conditions, including (but not limited to) that valid and unwithdrawn tenders are received representing at least 75% in aggregate outstanding principal amount of the 2002 Notes and the ROARs on a combined basis; AES' concurrent entry into a new senior secured credit facility; the valid amendment of certain documentation executed in connection with the issuance of the ROARS in order to permit the completion of the exchange offer; and the absence of certain adverse legal and market developments.

AES said that the new senior secured notes being offered to the holders of the 2002 notes and the ROARS would be secured equally and ratably with all debt outstanding under the new senior secured credit facilities, by first-priority liens, subject to certain exceptions and permitted liens, on all of the capital stock of domestic subsidiaries owned directly by AES and 65% of the capital stock of certain foreign subsidiaries owned directly by AES and on certain inter-company receivables, inter-company notes and inter-company tax sharing agreements owed to AES by its subsidiaries. In addition, the new senior secured notes will be subject to a mandatory offer to repurchase with a portion of the net cash proceeds received from certain asset sales by AES.

The offering of the new senior secured notes in the exchange offer is being made only to "qualified institutional buyers" and "persons other than a U.S. person" located outside the United States under the definitions contained in Rule 144A and Regulation S of the Securities Act of 1933, as amended.

AES further said that concurrently it was also launching a new multi-tranche $1.6 billion senior secured credit facility, which would be secured equally and ratably with the new senior secured notes. Consummation of the new senior secured facility would be subject to a number of conditions, including the completion of the exchange offer for the bonds and participation of all of its existing lenders.

On Oct. 28, AES said that it was extending the early tender deadline on its offer to 5 p.m. ET on Oct. 30, subject to possible further extension, from the original Oct. 25 deadline. On Oct. 31, AES said that it had again extended the early tender deadline to 5 p.m. ET on Nov. 1, subject to possible further extension, from the prior Oct. 30 deadline. On Nov. 4, AES said that it had waived the early tender deadline on the exchange offer, so that all holders validly tendering their notes by the Nov. 8 expiration deadline for the offer (which was subsequently extended) would be eligible for the applicable early tender bonus cash payment.

On Nov. 11, AES said that it had extended the exchange offer to 5 p.m. ET on Dec. 3, subject to possible further extension, from the previous Nov. 8 deadline, and had amended certain other terms of the exchange.

AES said that it had been informed by the exchange agent for the offer that, as of the old expiration deadline, approximately $16.863 million of its 2002 notes and $44.494 million of the ROARs had been tendered in the exchange offer, representing approximately 5.6% and 22.2% of the outstanding 2002 notes and ROARs, respectively.

The company modified the consideration it will pay to the holders of its 8 ¾% senior notes due 2002 to a mixture of $650 in cash and $350 in new securities per $1,000 principal amount of the old notes tendered (from $500 in cash and $500 in new notes previously).

The company had originally announced an early tender bonus to be paid in addition to the actual exchange consideration, with a separate, earlier deadline, for holders of the 8 ¾% notes and the 7 3/8% remarketable and redeemable securities ("ROARS") due 2013 that it is tendering for, but subsequently eliminated the earlier deadline, offering the bonus to all tendering holders. The Nov. 11 announcement restored the early tender deadline, setting it at 5 p.m. ET on Nov. 18; AES said that holders could withdraw their note tenders any time until that early deadline.

The previously announced respective early tender bonuses for the 8 ¾% notes and for the ROARS remained the same; however, AES said that holders tendering on or prior to the expiration date and not withdrawing such securities would still receive an incremental cash payment in the amount of $5 for each $1,000 principal amount 8¾% notes tendered and $5 for each $1,000 principal amount of ROARs tendered.

AES further said the consummation of the exchange offer would now be subject to the condition that 80% of the aggregate principal amount of the 8¾% notes and 80% of the aggregate principal amount of the ROARs be received and not withdrawn, a change from its original condition that 75% of the 8¾% notes and the ROARs on a combined aggregate basis be tendered.

On Nov. 19, AES once again waived the early tender deadline of 5 p.m. ET on Nov 18, and said that holders tendering their notes by the scheduled tender offer expiration deadline (5 p.m. ET on Dec. 3) and not withdrawing such securities would all be eligible to receive the previously announced early tender bonus payment, assuming the completion of the exchange offer.

On Nov. 27, AES said that it had been informed by the exchange agent for the exchange offer that as of 5 p.m. ET on Nov. 26, approximately $219.193 million in aggregate principal amount of its outstanding 8¾% notes, or 73% of the outstanding amount, had been tendered under the offer, as had approximately $157.851 million of the ROARs, or 79% of the outstanding amount.

AES indicated that it had not yet satisfied the minimum tender amount condition under the offer (tender of at least 80% of each note series).

Lexington Precision extends exchange offer for 12¾% notes

Lexington Precision Corp. said on Wednesday (Dec. 4) 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 midnight ET on Dec. 20, subject to possible further extension, from the previous Dec. 4 deadline.

Lexington said that as of Dec. 3, holders had tendered $27,209,125 of the notes, or 99.3% of the outstanding amount, unchanged from the amount announced on Oct. 31. While that has satisfied the 99% minimum tender condition to the exchange offer, the company said that a number of other conditions have not yet been satisfied, including the completion of a new senior secured credit facility on terms satisfactory to the company.

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 $27.412 million of 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 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 10 ½% 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 12 ¾% 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, and on Aug. 30, it said that it had again extended the offer to midnight ET on Sept. 30 and said that it had received tenders of $27,131,875 of the notes, or 98.98% of the outstanding amount, just shy of the 99% minimum tender condition. On Sept. 30, Lexington announced the further extension of the offer to 12 midnight ET on Oct. 18, and said that it had received tenders of $27,208,875 of the notes, or slightly more than 99% of the outstanding amount, satisfying the minimum tender condition to the consummation of the exchange offer. On Oct. 18, the company announced the further extension of the offer to 12 midnight on Oct. 31, subject to possible further extension, and said that as of Oct. 18, some $27,209,125 of the notes, or slightly more than 99% of the outstanding amount, had been tendered.

On Nov. 1, the company announced the further extension of the offer to midnight ET on Nov. 15, subject to possible further extension, from the previous Oct. 31 deadline. It reported the same level of noteholder participation in the offer as previously. The company further announced on Nov. 14 that it was extending the offer to midnight ET on Dec. 4, with the same level of noteholder participation as previously announced.

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