Chemtura Corporation Extends Escrow Period for Chapter 11 Exit
PHILADELPHIA--(BUSINESS WIRE)-- Chemtura Corporation, debtor-in-possession (Pink Sheets:CEMJQ.pk - News) (the “Company” or “Chemtura”), today announced its election to extend the escrow period to November 25, 2010 for the proceeds from its recent $455 million offering of senior notes and $295 million term loan.
As previously disclosed, on August 27, 2010, Chemtura completed its private placement offering of $455 million in aggregate principal amount of 7.875% senior notes due 2018 (the “Senior Notes”). The net proceeds of the Senior Notes offering were funded into a segregated escrow account, pursuant to an escrow agreement dated as of August 27, 2010 (the “Notes Escrow Agreement”), among Chemtura, U.S. Bank National Association, as trustee (the “Trustee”) and Wells Fargo Bank, National Association, as escrow agent (the “Escrow Agent”), together with cash sufficient to fund the redemption of the Senior Notes. On October 19, 2010, Chemtura notified the Trustee and the Escrow Agent that it had elected to extend the Initial Escrow End Date (as defined below) to November 25, 2010, and deposited with the Escrow Agent $3,020,583.86, representing the amount of interest that would accrue, including original issue discount, on the funded amount of the Senior Notes from October 26, 2010 (the “Initial Escrow End Date”) up to, but excluding, December 3, 2010.
On August 27, 2010, Chemtura also entered into the Senior Secured Term Facility Credit Agreement (the “Term Loan Agreement”), among Chemtura, Bank of America, N.A., as administrative agent (the “Administrative Agent”), the other agents party thereto and the Initial Lenders and other Lenders party thereto. Under the Term Loan Agreement, the Lenders advanced an aggregate principal amount of $295 million (the “Term Loan”), funded at 99% of such principal amount. The proceeds of the Term Loan were funded into a segregated escrow account (the “Escrow Account”), pursuant to the escrow agreement dated as of August 27, 2010 (the “Term Loan Escrow Agreement”), among Chemtura, the Administrative Agent and the Escrow Agent, together with a deposit by Chemtura of an additional amount sufficient to fund the interest expected to accrue on the Term Loan for the period from the August 27, 2010 to October 26, 2010, and the amount of the arrangers’ fees and expenses. On October 20, 2010, Chemtura notified the Administrative Agent and the Escrow Agent that it had elected to extend the Initial Escrow End Date to November 25, 2010, and will deposit with the Escrow Agent the amount of interest that would accrue on the Term Loan from the Initial Escrow End Date up to, but excluding, November 25, 2010.
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