MXenergy further extends exchange offer for floating-rate notes

By Angela McDaniels

Tacoma, Wash., Aug. 13 - MXenergy Holdings Inc. once more extended the early consent deadline in the private exchange offer and consent solicitation for its floating-rate senior notes due 2011, this time to 5 p.m. ET on Aug. 14 from Aug. 12.

The company also extended the offer expiration to midnight ET on Aug. 15 from Aug. 13.

MXenergy said it extended the deadlines in order to continue negotiations with the contemplated provider of its proposed new credit, hedge and supply facilities.

As of midnight ET on Aug. 13, holders had submitted tenders and consents for approximately $158.8 million principal amount of notes and consented to the proposed amendments.

For each $1,000 principal amount of notes exchanged, holders will receive $138.15 in cash, $393.33 principal amount of a new series of 13% senior secured notes due 2014, 188.91 shares of the company's common stock and accrued interest up to but excluding the settlement date.

The company will also pay a premium of $30.00 for each $1,000 principal amount of the notes tendered by the early deadline.

MXenergy is soliciting consents from the noteholders for proposed amendments that would eliminate or amend substantially all of the restrictive covenants and modify a number of the events of default and some other provisions, including the change-of-control provisions.

Consents are needed from holders of at least a majority of the outstanding notes.

Holders who wish to participate must tender all of their notes, and holders who tender will be deemed to have given consent.

The offer is conditioned on, among other things, the receipt of tenders for at least 90% of the outstanding notes, the company refinancing and replacing its revolving credit facility and hedge facility, the company amending its current credit facility with Denham Commodity Partners LP, the conversion of MXenergy's series A convertible preferred stock into common stock, the creation of a management incentive plan and the receipt of any consents from government bodies or authorities that are required.

The new notes will be guaranteed by all of the company's subsidiaries that guarantee the existing notes. They will also be secured on a third-lien priority basis by substantially all of the assets of the company and the guarantors, provided that the new notes will have a first-priority security interest on a notes escrow account that will have cash, cash equivalents or government securities in an amount sufficient to make two semiannual interest payments.

The exchange offer and consent solicitation began June 29 and are being made only to accredited investors inside the United States and certain non-U.S. investors located outside the United States who have delivered an eligibility letter.

The information agent is Global Bondholder Services Corp. (866 387-1500 or, for banks and brokers only, 212 430-3774).

MXenergy is a retail natural gas and electricity supplier based in Stamford, Conn.

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