CKE Restaurants converts $39.2 million of 4% convertibles upon noteholders' request

By Angela McDaniels

Seattle, Aug. 8 - CKE Restaurants Inc. said it converted $39.2 million of its 4% convertible subordinated notes due 2023 into 4,465,569 shares of common stock after it received an unsolicited offer from the holders of the notes to convert in advance of the first call date, which falls in 2008.

In addition to the conversion, CKE made a cash payment to the holders that included accrued interest and $2.7 million as an inducement to convert and in lieu of future interest on the notes, according to a company news release.

The conversion reduced the amount of notes outstanding by roughly 37%.

The issued shares will not impact diluted shares outstanding because these shares were already included in the calculation of diluted shares outstanding, according to the release.

CKE is a Carpinteria, Calif., owner, operator, franchiser and licenser of quick-service restaurants.

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