EX-10.2



 





Exhibit 10-2




FIRST AMENDMENT TO FORBEARANCE AGREEMENT




          This FIRST AMENDMENT to the Forbearance Agreement (as defined below), dated September 24, 2007
(the “First Amendment”) is entered into by and among LEXINGTON PRECISION CORPORATION, a
Delaware corporation (“Lexington”), and each of the undersigned holders (collectively,
“Holders” and each, a “Holder”) of 12% Senior Subordinated Notes due August 1, 2009
(the “Notes”) issued by Lexington pursuant to the Indenture dated as of December 18, 2003,
as supplemented by the First Supplemental Indenture dated as of May 25, 2007, between Lexington and
Wilmington Trust Company, as Trustee (the “Indenture”).




WITNESSETH:




          WHEREAS, Lexington and the Holders are engaged in good faith negotiations with the objective
of reaching an agreement with regard to a corporate and financial restructuring of Lexington and
its subsidiaries, including indebtedness held by the Holders;




          WHEREAS, Lexington has failed to make the November 1, 2006, the February 1, 2007, the May 1,
2007, and the August 1, 2007, and will fail to make the November 1, 2007 interest payments (the
“Interest Payments”) due under the Indenture;




          WHEREAS, the Holders and Lexington are party to that certain Forbearance Agreement dated as of
May 25, 2007 (the “Forbearance Agreement”); and




          WHEREAS, Lexington has requested, and the Holders have agreed, to extend the forbearance
period under the Forbearance Agreement.




          NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements as
set forth herein, and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Lexington and each Holder hereby agree as follows:




          1. Section 2(b) of the Forbearance Agreement is deleted in its entirely and replaced with the
following:




The period of forbearance (the “Forbearance Period”) shall commence on May 25, 2007
and end on January 24, 2008, subject to earlier termination pursuant to the terms of
Section 2(c) hereof.




          2. Except as herein amended, all terms and conditions of the Forbearance Agreement are hereby
reaffirmed and shall remain in full force and effect as originally written and shall be construed
as one document with this First Amendment.




          3. This First Amendment may be executed in one or more counterparts, each of which shall be
deemed an original and all of which shall constitute one and the same First Amendment. This First
Amendment may be executed and delivered by facsimile and upon such delivery the facsimile signature
will be deemed to have the same effect as if the original signature had been delivered to the other
party.




 









 








     IN WITNESS WHEREOF, each of the parties hereto has caused this First Amendment to be executed
and delivered by its duly authorized officer as of the date first above written.



	 	 	 	 	 
	 	LEXINGTON PRECISION CORPORATION

 	 
	 	By:  	/s/  Warren Delano
 	 
	 	 	Name:  	Warren Delano 	 
	 	 	Title:  	President 	 
	 



	 	 	 	 	 
	Name of Holder:

	 	Jefferies High Yield Trading, LLC
	 	 
	Address:

	 	The Metro Center

One Station Place, Three North	 	 
	 

	 	Stamford, CT 06902	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $12,690,000




JEFFERIES HIGH YIELD TRADING, LLC




	 	 	 	 	 
	By:

	 	/s/ Robert J. Welch
 

Name: Robert J. Welch

Title: Chief Financial Officer
	 	 






	 	 	 	 	 
	Name of Holder:

	 	Wilfrid Aubrey Growth Fund, L.P.
	 	 
	Address:

	 	100 William Street, Suite 1850

New York, NY 10038	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $1,621,000




WILFRID AUBREY GROWTH FUND, L.P.




	 	 	 	 	 
	By:

	 	WILFRID AUBREY ASSOCIATES LLC, a Delaware limited liability company, its General Partner
	 	 






	 	 	 	 	 
	By:

	 	/s/ Nicholas W. Walsh CFA
 

Name: Nicholas W. Walsh CFA

Title: Principal
	 	 






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	Name of Holder:

	 	Wilfrid Aubrey International Limited
	 	 
	Address:

	 	100 William Street, Suite 1850

New York, NY 10038	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $2,856,000




WILFRID AUBREY INTERNATIONAL LIMITED




	 	 	 	 	 
	By:

	 	WILFRID AUBREY LLC, a Delaware limited liability company, its Investment Manager	 	 
	 
	 	 	 	 
	By:

	 	/s/ Nicholas W. Walsh CFA
 

Name:   Nicholas W. Walsh CFA

Title:     Principal
	 	 






	 	 	 	 	 
	Name of Holder:

	 	First Trust Strategic High Income Fund
	 	 
	Address:

	 	2527 Nelson Miller Parkway, Suite 207

Louisville, KY 40223	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $1,500,000




FIRST TRUST STRATEGIC HIGH INCOME FUND




	 	 	 	 	 
	By:

	 	VALHALLA CAPITAL PARTNERS LLC, its Sub-Advisor	 	 
	 
	 	 	 	 
	By:

	 	/s/ Rip Mecherle
 

Name:   Rip Mecherle

Title:     Managing Partner
	 	 






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	Name of Holder:

	 	First Trust Strategic High Income Fund II
	 	 
	Address:

	 	2527 Nelson Miller Parkway, Suite 207

Louisville, KY 40223	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $1,500,000




FIRST TRUST STRATEGIC HIGH INCOME FUND II




	 	 	 	 	 
	By:

	 	VALHALLA CAPITAL PARTNERS LLC, its Sub-Advisor	 	 
	 
	 	 	 	 
	By:

	 	/s/ Rip Mecherle
 

Name:   Rip Mecherle

Title:     Managing Partner
	 	 






	 	 	 	 	 
	Name of Holder:

	 	Cape Fund, LP
	 	 
	Address:

	 	One Georgia Center, Suite 1560
	 	 
	 

	 	600 West Peachtree Street

Atlanta, GA 30308	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $1,325,000




CAPE FUND, LP




	 	 	 	 	 
	By:

	 	CAPE INVESTMENTS, LLC, its General Partner	 	 
	 
	 	 	 	 
	By:

	 	/s/ J. T. King
 

Name:    J. T. King 

Title:     Managing Director
	 	 






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	Name of Holder:

	 	Cape Fund II, LP
	 	 
	Address:

	 	One Georgia Center, Suite 1560

600 West Peachtree Street

Atlanta, GA 30308	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $675,000




CAPE FUND II, LP




	 	 	 	 	 
	By:

	 	CAPE INVESTMENTS, LLC, its General Partner	 	 
	 
	 	 	 	 
	By:

	 	/s/ J. T. King
 

Name:  J.T. King

Title:    Managing Director
	 	 






	 	 	 	 	 
	Name of Holder:

	 	Hedgehog Capital LLC
	 	 
	Address:

	 	1117 E. Putnam Ave., #320

Riverside, CT 06878	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $1,761,000




HEDGEHOG CAPITAL LLC




	 	 	 	 	 
	By:

	 	/s/ Robert Chung
 

Name: Robert Chung

Title:
	 	 






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	Name of Holder:

	 	 Sandler Capital Structure Opportunities Master Fund, Ltd
	 	 
	Address:

	 	711 Fifth Avenue, 15th Floor

New York, NY 10022	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $1,271,000




SANDLER CAPITAL STRUCTURE OPPORTUNITIES MASTER FUND, LTD




	 	 	 	 	 
	By:

	 	SANDLER CAPITAL MANAGEMENT, its Investment Manager	 	 
	 
	 	 	 	 
	 

	 	By: SERF CORP, a general partner	 	 
	 
	 	 	 	 
	By:

	 	/s/ Moira Mitchell
 

Name:   Moira Mitchell

Title:     President
	 	 






	 	 	 	 	 
	Name of Holder:

	 	Permal Capital Structure Opportunities, Ltd.
	 	 
	Address:

	 	711 Fifth Avenue, 15th Floor

New York, NY 10022	 	 






Amount of 12% Senior Subordinated Notes

due August 1, 2009 Beneficially Owned: $229,000




PERMAL CAPITAL STRUCTURE OPPORTUNITIES, LTD.




	 	 	 	 	 
	By:

	 	SANDLER CAPITAL MANAGEMENT, its Investment Manager	 	 
	 
	 	 	 	 
	 

	 	By: SERF CORP, a general partner	 	 
	 
	 	 	 	 
	By:

	 	/s/ Moira Mitchell
 

Name: Moira Mitchell

Title: President
	 	 






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