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Reichhold Industries Inc. enters into agreement on exchange of its 9% senior notes due 2014

News International-French

17 Feb 2012

Reichhold Industries Inc. announced that it has reached an agreement in principle with institutions holding more than 70 percent in principal amount of the Company’s outstanding nice percent Senior Unsecured Notes due 2014 on the terms of an exchange transaction that would significantly reduce the Company’s cash debt service obligations and provide the Company with enhanced financial, operational and strategic flexibility. 

As part of this transaction, the Exchanging Noteholders will exchange their unsecured Senior Notes and other holders of Senior Notes will be offered a chance to exchange their Senior Notes for their pro rata share of new Senior Secured Notes due 2017. The Company will have the option to not pay cash interest on the New Notes for the first two years following the Exchange Offer, providing the Company with the opportunity to retain substantial additional liquidity as economic conditions improve. In addition, the New Notes will extend maturity to 2017, eliminating refinancing risk related to the maturity of the existing Senior Notes in 2014. The Exchanging Noteholders have agreed, and any other holder who elects to participate in the Exchange Offer will agree, to defer the interest payment due February 15, 2012 (such deferred payment to be capitalized).


Reichhold has been advised on financial matters by Moelis & Company and on legal matters by Dow Lohnes PLLC.  The Exchanging Noteholders have been advised on financial matters by Houlihan Lokey and on legal matters by Paul, Weiss, Rifkind, Wharton & Garrison LLP.


None of the securities that the Company expects to offer or sell pursuant to the support agreement have been or will be registered under the United States Securities Act of 1933, as amended (the “Act”), and none of them may be offered or sold in the United States absent registration or applicable exemption from the registration requirements of the Act.  This is not an offer to buy or a solicitation of an offer to exchange Senior Notes, any such offer will be made through definitive documents delivered to holders of the Senior Notes as part of the Exchange Offer.


About Reichhold

Founded in 1927, Reichhold, with its world headquarters and technology center in Research Triangle Park, North Carolina, USA, is one of the world’s largest suppliers of unsaturated polyester resins and a leading supplier of coating resins for the industrial, transportation, building and construction, marine, consumer and graphic arts markets. Reichhold has manufacturing operations throughout North America, Latin America, the Middle East, Asia and Europe.


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