Kraton Performance Polymers in Refinancing Transactions

Cleary Gottlieb represented Kraton Performance Polymers, Inc. in a series of refinancing transactions, consisting of:

• an offering of $250 million in aggregate principal amount of 6.75% Senior Notes due 2019 (the “Notes”) through an institutional private placement. Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse Securities (USA) LLC, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated and Macquarie Capital (USA) Inc. served as joint book-running managers in connection with the offering of the Notes;
  
  
• a new senior secured credit facility with Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse Securities (USA) LLC, Goldman Sachs Bank USA, Morgan Stanley Senior Funding, Inc. and Macquarie Capital (USA) Inc. as joint lead arrangers and joint book-runners, and Bank of America, N.A., as administrative agent and collateral agent. The new senior secured credit facility consists of (1) a $200 million senior secured revolving credit facility and (2) a $150 million senior secured term loan facility; and
  
  
• a tender offer to purchase for cash any and all of its outstanding 8.125% Senior Subordinated Notes due 2014 (the “8.125% Notes”) and a concurrent solicitation of consents from the holders to amend the indenture governing the 8.125% Notes. As a result of receiving tenders and related consents from a majority of holders, a supplemental indenture was executed to eliminate substantially all of the restrictive covenants, certain events of default and related provisions contained in the indenture. Kraton also issued irrevocable notices of redemption for any 8.125% Notes that are not purchased in the tender offer and for the remaining amount of its 12% senior discount notes. Merrill Lynch, Pierce, Fenner & Smith Incorporated served as Dealer Manager and Solicitation Agent, and D.F. King & Co., Inc. was the Information Agent for the tender offer.

The proceeds of the offering of the $250 million Notes, together with the proceeds from the $150 million senior secured term loan facility and available cash, were used to refinance substantially all of Kraton’s existing indebtedness and to pay accrued and unpaid interest thereon, related fees and expenses and tender premiums with respect to the existing indebtedness.

Kraton is a leading global producer of engineered polymers used in a wide range of applications, including adhesives, coatings, consumer and personal care products, sealants and lubricants, and medical, packaging, automotive, paving, roofing and footwear products. Cleary Gottlieb has been advising Kraton on legal matters since 2003, including its initial public offering in December 2009 and a follow-on secondary offering in September 2010.