The battery maker Exide Corp. got a taste of how tight credit standards have become last week when its bankers, Credit Suisse First Boston and Citigroup's Salomon Smith Barney, took the highly unusual step of offering warrants to attract investors for its $250 million syndicated loan.

The sweetener was an attachment to Exide's senior secured debt, offered after the bank debt issue flopped with investors its first time out in August. The arrangers got the market's attention by raising the yield spread by half a point, to 4.5 percentage points over the London Interbank Offered Rate, including extra prepayment penalties; and by adding warrants to buy up to 3% of the company's stock. Warrants are more commonly reserved for junk bonds or IPOs.

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