Dick’s Sporting Goods to fully redeem 3.25% convertibles on April 18

By Mary-Katherine Stinson

Lexington, Ky., Feb. 9 – Dick’s Sporting Goods, Inc. will redeem in full its $59,127,000 outstanding 3.25% convertible notes due 2025, according to a press release and an 8-K filing with the Securities and Exchange Commission.

The redemption will be at par plus accrued interest up to but excluding the redemption date of April 18.

Notes called for redemption may be converted any time before the close of business on April 17.

Due to the make-whole fundamental change under the indenture, the conversion rate has been increased by 0.1443 shares resulting in a conversion rate (including the additional shares) of 31.2358 shares of common stock of Dick’s per $1,000 principal amount of notes.

All conversions will be settled by delivering shares of the company’s common stock and paying cash in lieu of fractional shares, as applicable.

Following the redemption, the company’s annual interest payments will be reduced by about $1.9 million.

The company intends to enter into complete unwind agreements with a financial institution relating to the remaining portions of the convertible note hedge transaction and warrant transaction that were previously entered into in connection with the notes issuance. Under such unwind agreements, the financial institution would deliver to the company a number of shares of common stock in respect of the remaining portions of the transactions being early terminated.

U.S. Bank Trust Co., NA is the paying agent and conversion agent.

Dick’s Sporting Goods is a Pittsburgh-based sporting goods retailer.

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