Hercules Offshore Inc. (Nasdaq: HERO) notified the holders of its 3.375% convertible senior notes due 2038 of their repurchase option.
Holders have the right to require Hercules Offshore to repurchase their notes on June 1 at a repurchase price in cash equal to 100% of the original principal amount of the notes plus accrued and unpaid interest, if any.
The optional repurchase date is an "interest payment date" under the terms of the notes. If all outstanding notes are surrendered for repurchase, the aggregate cash repurchase price will be US $68.3 million. Hercules Offshore intends to pay the optional repurchase price by using available cash.
The notes are also currently convertible into shares of Hercules Offshore's common stock at a rate of 19.9695 shares of common stock per US $1,000 original principal amount, which is equal to a conversion price of US $50.08 per share, at the option of the holder and so long as specified conditions are met. Hercules Offshore, at its election, may settle any notes surrendered for conversion in shares of common stock, cash or a combination thereof. Cash will be delivered in lieu of any fractional shares. If a holder has already delivered a repurchase notice with respect to a note, the holder may not surrender that note for conversion unless and until the holder has validly withdrawn the repurchase notice.
The repurchase option commences May 1 and expires May 31. Holders may withdraw their election to exercise the repurchase option at any time prior the expiration date.
Hercules Offshore Inc., together with its subsidiaries, provides shallow-water drilling and marine services to the oil and natural gas E&P industry worldwide. The company is headquartered in Houston.
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