Terremark Worldwide issues 6.625% convertibles due 2013 in exchange for 9% convertibles due 2009

By Jennifer Chiou

New York, May 2 - Terremark Worldwide, Inc. said that it issued an equal amount of new 6.625% senior convertible notes due 2013 in exchange for $57.2 million of its 9% senior convertible notes due 2009.

The Miami-based operator of internet and telecommunications infrastructure completed the private exchanges with a limited number of noteholders.

Terremark said that $29.1 million of 9% notes remains outstanding, adding that it will initiate a public exchange offer to holders of those notes.

According to the company, the terms of the new notes are substantially similar to the terms of the 9% notes, except that the new notes have neither a call option nor the early conversion incentive payment that is applicable to the 9% notes.

The new notes provide for a make-whole premium payable upon conversions linked to a change in control, in which at least 10% of the consideration is cash, while the 9% notes provide for certain cash make whole payments in connection with a change of control, in which at least 50% of the consideration is cash.

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