Everest & Jennings Plans Restructuring of Debt

Everest & Jennings International Ltd., a struggling wheelchair manufacturer, said it reached tentative agreement with its major stockholder and its main lender for restructuring about $55 million of the Camarillo-based company’s debt.

The net result of the plan would be to reduce the debt by about one third and to provide Everest & Jennings with continued financing through Sept. 30, 1992, Everest & Jennings President Barre Rorabaugh said.

Under the proposal, Industrial Equity Pacific Ltd. would exchange the portion of the debt it holds for about 5.4 million shares of a new issue of convertible preferred stock in Everest & Jennings.

That would raise IEP’s effective equity ownership of Everest & Jennings to more than 50% from its current 31%. IEP, which is controlled by New Zealand investor Ronald Brierley, already had voting control of the company because it holds voting rights to a large number of shares owned by other stockholders.

Also under the proposed restructuring, Security Pacific National Bank, which is owed the bulk of the debt being restructured, would get about 800,000 shares of a separate new class of convertible preferred stock that would represent up to a 5% stake in Everest & Jennings.

The proposal, which is subject to stockholder approval, would provide “a firm foundation on which to build for future growth, profitability and strengthening of the balance sheet,” Rorabaugh said.

In the nine months ended Sept. 30, Everest & Jennings lost $46.5 million on revenue of $156.3 million, largely because of $32.4 million in restructuring charges.