Barzel defers interest payment on 11½% notes by three months to Aug. 14

By Angela McDaniels

Tacoma, Wash., May 15 - Barzel Industries Inc. said the $18.1 million interest payment due Friday on Barzel Finco Inc.'s $315 million 11½% senior secured notes due 2015 has been deferred until Aug. 14.

During the deferral period, interest on the principal amount and on the deferred interest will accrue at 13½%.

The holders of the notes - JPMorgan Chase Bank, NA and CIBC World Markets Inc. - entered into the deferral agreement with the company and the issuer on Thursday, according to an 8-K filing with the Securities and Exchange Commission.

The company said that no default or event of default under the indenture will occur due to the deferral.

Under the deferral agreement, Barzel agreed that it will try to complete a debt and/or equity recapitalization or restructuring, a debt refinancing, a capital-raising transaction or a sale of equity securities or assets.

The company also agreed to covenants that include restrictions on the creation and existence of liens other than in the ordinary course; the sale, lease or other disposition of assets other than in the ordinary course; dividends and other distributions; debt and equity repurchases; and management incentive fees, earn-out payments and bonus payments.

Barzel Industries is based in Norwood, Mass., and operates a network of manufacturing, processing and distribution facilities in the United States and Canada.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.