NEW YORK (April 17, 2008) — Lexington Precision Corp. and its wholly owned subsidiary Lexington Rubber Group Inc. have filed for Chapter 11 bankruptcy protection.
The firm said in a statement that it filed for Chapter 11 because it couldn't reach an agreement on the restructuring of its senior subordinated notes with a group of six hedge funds that hold a significant portion of the notes. Lexington said it made several offers it believed gave the noteholders full value for their claims but no agreement could be reached.
Lexington said it believes it has more than adequate funding to operate its businesses without interruption, noting that its secured lenders have agreed to leave existing loans in place and allow the company to use cash receipts for the operation of the business.
Although Lexington said it has explored sales of various assets and businesses during the past year, it presently intends to propose a plan of reorganization where it would keep all of its business units.