Hornbeck Offshore Services Inc. (NYSE: HOS) issued a notice of redemption for all of its outstanding 1.625% convertible senior notes due 2026 on Sept. 13.
The redemption is pursuant to that certain indenture dated as of Nov. 13, 2006, among the company, the guarantors set forth therein and Wells Fargo Bank, National Association, as trustee. The company has elected to redeem the notes on Nov. 15 at 100% of the principal amount thereof and accrued and unpaid interest to, but excluding, the redemption date. There are currently $250 million in aggregate principal amount of notes outstanding.
Holders may convert the notes at any time prior to the close of business on Nov. 12 at a conversion rate of 20.6260 shares of the company's common stock per $1,000 principal amount of notes with a related observation period of Oct. 8 through Nov. 11. In the event that holders elect to convert their notes in connection with the redemption, the company will satisfy its conversion obligations to holders by paying cash equal to the principal amount of the notes and delivering shares of common stock in settlement of any and all conversion obligations in excess of the principal amount provided that the company will pay cash in lieu of issuing fractional shares. If holders elect to convert their notes, the counterparties to the previously disclosed convertible note hedge transactions entered into in 2006 concurrently with the execution of the indenture and the issuance of the notes are contractually obligated to deliver common stock to the company that will reduce or prevent equity dilution that would otherwise result from the conversion.
The company's notice to holders specifying the terms, conditions and procedures for the redemption and/or conversion is available through The Depository Trust Co. and the trustee, Wells Fargo Bank, National Association. Wells Fargo Bank, National Association, is paying agent and conversion agent.
Hornbeck Offshore Services Inc. provides marine transportation services to E&P, oilfield service, offshore construction, and the U.S. military customers. The company is headquartered in Covington, La.
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