James River Coal plans exchange offer for 4.5%, 3.125% convertibles

By Angela McDaniels

Tacoma, Wash., June 18 - James River Coal Co. plans to hold an exchange offer for its $51.2 million of outstanding 4.5% convertible senior notes due 2015 and its $51.6 million of outstanding 3.125% convertible senior notes due 2018, according to an S-4 filing with the Securities and Exchange Commission.

The company will offer 10% convertible senior notes due 2018 in exchange for the existing convertibles.

The offers are expected to end sometime in July.

The company said the purpose of the exchange offers is to restructure and reduce its debt and ultimately to improve its strategic and financial flexibility.

10% convertibles

The 10% convertibles will be an add-on to the $123.3 million of 10% convertibles issued on May 22 in exchange for $243.4 million of the existing convertibles under separate, privately negotiated agreements with the holders of those convertibles.

As previously reported, the company issued $55.8 million of 10% convertibles in exchange for $90 million of 4.5% convertibles and $67.5 million of 10% convertibles in exchange for $153.4 million of 3.125% convertibles.

The conversion price of the 10% convertibles is $5.00, compared with $25.78 for the 4.5% convertibles and $30.55 for the 3.125% convertibles.

The company's shares closed at $2.10 (Nasdaq: JRCC) on June 17.

The company may force conversion of the 10% notes if the daily volume-weighted average price of its stock is $7.50 or greater for at least 20 trading days in any 30-trading-day period.

The 10% convertibles have a change-of-control put option.

The ranking of the 10% convertibles is the same as the old convertibles except that the 10% convertibles are guaranteed by some subsidiaries of the company.

James River is a coal company based in Richmond, Va.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.