Georgia Gulf completes successful debt-for-equity exchange

Client(s) Georgia Gulf Corporation

Jones Day represented Georgia Gulf Corporation in its successful exchange of 92% of the aggregate outstanding principal amount of $736 million owing in respect of three series Senior Notes. The senior notes were exchanged for approximately 30.2 million shares of Convertible Preferred Stock and 1.3 million shares of Common Stock, giving effect to a 1 for 25 reverse stock split. The distribution of the shares were distributed among noteholders as follows:

- 7.125% senior noteholders received 85% of the equity

- 9.5% senior noteholders received 11% of the equity

- 10.75% senior subordinated noteholders received 4% of the equity

In connection with the exchange, Georgia Gulf entered into supplemental indentures related to each series of notes, which removed substantially all of the restrictive covenants contained in the indentures and eliminated certain events of default. Additionally, Georgia Gulf and its secured lenders agreed to an amendment to Georgia Gulf's existing secured bank facility which, among other things, eliminated the existing EBITDA covenant, and the leverage ratios, and interest coverage ratios were significantly relaxed. The credit agreement amendment added new minimum fixed charge coverage and maximum senior secured leverage ratios.