Neff Corp. releases corrected data on note buybacks

Neff Corp. (Ca/B+) said Friday (Aug. 2) that it had previously released incorrect information on its senior subordinated notes buyback program when it issued its financial data for the second quarter and the first half of the year on Wednesday (July 31). Neff said that for the six months ended June 30, Neff recorded a $12.3 million extraordinary gain on the repurchase of an aggregate principal amount of $43.7 million in an aggregate principal amount of senior subordinated notes.

AS PREVIOUSLY ANNOUNCED, Neff, a Miami-based equipment rental concern, originally reported on July 31 that it had recorded a $12.3 million extraordinary gain on the repurchase of an aggregate principal amount of $24.7 million of senior subordinated notes during the six-month period, with the latter figure subsequently corrected. Neff also reported that in the second quarter ended June 30, it had repurchased $19 million of the senior subordinated notes for a purchase price of $13.1 million, resulting in an extraordinary gain on the extinguishment of debt for the quarter of $5.3 million (25 cents per diluted share). Neff further said that as of June 30, its consolidated debt was approximately $292.7 million, including approximately $137.3 million of debt outstanding under its revolving credit facility. For the six months ended June 30, the company said it had reduced total outstanding debt by $24.4 million through the repurchase of notes and applying free cash flow to repay amounts outstanding under the Company's revolving credit facility.

Hawk Corp. begins exchange offer for 10¼% '03 notes

Hawk Corp. (B2/B-) said in an S-4 filing with the Securities and Exchange Commission on Friday (Aug. 2) that it was beginning an offer to exchange new debt for its $64.725 million of outstanding 10¼% senior subordinated notes due 2003 and was also soliciting the consent of the noteholders to proposed indenture changes. Hawk, a Cleveland-based manufacturer of friction products and precision industrial components, said it would exchange the new notes for the existing notes in order to extend the maturity of its debt, although neither the maturity nor the coupon of the proposed new notes was immediately specified in the filing. Hawk's domestic subsidiaries will guarantee the payment of interest and principal under the new notes. Hawk also did not formally set an expiration deadline for the offer, nor did it set a deadline for its consent solicitation. It said that the exchange offer and consent solicitation are subject to the valid tenders of at least a majority of the outstanding notes, and subject to the refinancing of the existing credit facility on terms acceptable to the company and to other customary conditions.

Holders who tender their notes will be deemed to have consented to the proposed indenture amendments, which will essentially eliminate all of the restrictive covenants, while holders must tender their notes in order to consent. Holders may withdraw tenders of the outstanding notes at any time before Hawk notifies the trustee for the old notes that it has received valid and unrevoked consents representing a majority of the outstanding notes. Hawk intends to pay a consent payment for notes tendered by the as-yet-unspecified consent deadline, but it did not specify the amount of that payment in its filing. Any notes which remain outstanding after the expiration of the exchange offer will be subject to the indenture changes, even if the holder did not tender the notes and grant consent. Banc of America Securities will be the exclusive dealer-manager for the exchange offer and consent solicitation; D.F. King & Co. will be the information agent, and HSBC Bank USA will be the exchange agent.

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