Knowles Electronics in default on credit facility, misses note coupon

By Sara Rosenberg

New York, April 30 - Knowles Electronics Holdings Inc. said it is currently in negotiations with its lenders on modifications and waivers to covenants under its bank credit facility. The company has been unable to comply with "several of the covenants" because of lower first quarter 2002 operating results, according to a company press release.

The company also said it has not made the coupon payment due April 15 on its 13 1/8% senior subordinated notes.

Negotiations on amending the credit facility are expected to be completed "shortly", the company said. However, until the amendment is finalized the company has delayed filing its 10-K annual report and the interest payments on its 13 1/8% notes.

After the Itasca, Ill. transducer and acoustic component manufacturer is in compliance with its credit facility agreement, the 10-K will be filed and interest payment on the notes will be made, according to the release.

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