By Susanna Moon
Chicago, May 2 - TeleCommunication Systems, Inc. will issue new convertibles in exchange for $50 million principal of its outstanding 4.5% convertible senior notes due 2014.
In the exchange, the company will issue $50 million principal amount of new 7.75% convertible senior notes due 2018.
The company entered into separate privately negotiated exchange agreements with noteholders on May 2, according to an 8-K filing with the Securities and Exchange Commission.
After settlement on May 7, $43.5 million of the original notes will remain outstanding.
The company said it will retire the 4.5% convertibles issued in 2009.
For the new notes, the conversion rate initially will be 96.637 shares of class A common stock per $1,000 principal amount of notes, or an initial conversion price of $10.348 per share. This price is the same as the old notes.
The company's shares closed at $1.97 (Nasdaq: TSYS) on May 1.
The notes are callable beginning June 30, 2014.
TeleCommunication Systems is an Annapolis, Md.-based wireless communication provider.
| Issuer: | TeleCommunication Systems, Inc.
|
| Issue: | Convertible senior notes
|
| Amount: | $50 million
|
| Maturity: | 2018
|
| Coupon: | 7.75%
|
| Conversion price: | $10.348
|
| Call option: | Beginning June 30, 2014
|
| Settlement date: | May 7
|
| Stock symbol: | Nasdaq: TSYS
|
| Stock price: | Stock price: $1.97 on May 1
|
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