Grupo TMM extends, amends exchange offer

New York, April 24 - Grupo TMM, SA said it amended and extended its exchange offer for all its outstanding 9½% senior notes due later this year and its 10¼% senior notes due 2006.

The Mexico City transportation company said the main reason for the change is to give it sufficient time to complete its pending sales of its interests in its ports and terminals division and its interest in Grupo TFM, as well as to amend the indentures governing the existing notes to permit these sales.

Under the amendment, the new notes being offered will have a high interest rate and a shorter maturity and the warrant component for the 2003 notes will be eliminated as will the consent fee.

The new notes will have an interest rate of 12%, payable at maturity on May 15, 2004. They will include a requirement that Grupo TMM use the proceeds from certain asset sales or certain tax matters to repurchase new notes at par value.

Holders of the existing notes will receive an equal principal amount of the new notes.

Previously Grupo TMM had been offering new 10¾% percent senior notes due 2009 for the existing notes. It had also proposed to pay a cash consent fee of $5 per $1,000 principal amount of existing notes. It also had been offering holders of the 9½% 55 warrants to purchase the company's American Depositary Shares per $1,000 principal amount.

No expiration date for the revised offer was given.

Grupo TMM said the exchange was subject to 80% of the 9½% notes being tendered and a majority of the 10¼% notes.

Citigroup Global Markets Inc. is acting as the dealer manager for the exchange offers and consent solicitations and Mellon Investor Services LLC (call 888 689-1607 or, for banks and brokers, 917 320-6286) is the information agent.

Lexington Precision extends offer again

Lexington Precision Corp. announced again extended the expiration date of its offer to exchange its 12¾% senior subordinated notes due Feb. 1, 2000 for new units consisting of 11½% senior subordinated notes due August 1, 2007 and warrants to purchase common stock.

The offer, which was scheduled to expire at midnight ET on April 24, was extended to midnight ET on May 15, unless further extended.

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, 2002 that it had begun an exchange offer for its $27.412 million outstanding 12¾% notes. Under the terms of the exchange as originally announced - a number of the terms would be subsequently amended, as indicated - the offer 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, 2002. The company said that accrued interest would total $350.625 per $1,000 principal amount of the existing notes. It said that 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 multiple times. It said that interest on the new 11½% notes would accrue from May 1, 2002; 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, 2002 and March 31, 2003. Lexington further said it would 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 it was undertaking the exchange offer as part of a larger comprehensive financial restructuring plan that would also involve an extension of the company's 10½% 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 were to be completed, it would not 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 12¾% 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.

A series of similar announcements further extending the offer were subsequently made, most recently on March 7, with the same level of noteholder participation as previously announced.

Also on March 7, Lexington announced several amendments to the previously announced terms of the offer; it said that under the terms of the amended exchange offer, tendering holders of the 12¾% notes will 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 on those notes for the period of 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).

If the amended exchange offer is consummated on March 25, 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 are tendered, and the exchange offer is completed, $12.757 million of accrued interest will be converted into new 11½% notes (up from the previously announced $9.611 million of total accrued interest).

Interest on the new 11½% notes will accrue from the date the amended exchange offer is consummated, and will 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). The completion of the amended exchange offer will be subject to a number of conditions precedent, including the refinancing or retirement of all of the company's debt, other than the 12¾% notes, on terms satisfactory to the company. The company decided to amend the exchange offer in order to enhance the likelihood of its completing a refinancing of its senior, secured debt on satisfactory terms.

The company said it has discussed the amendment to the exchange offer with representatives of the four largest holders of the 12¾% notes, who have indicated their intention to continue to participate in the exchange offer, as amended.

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