Archstone $75 million greenshoe exercised in full, raising exchangeables offer to $575 million

By Jennifer Chiou

New York, July 12 - The Archstone-Smith Trust said that underwriters fully exercised a $75 million greenshoe, lifting its offer of 30-year exchangeable senior notes to $575 million.

The notes, which were issued by subsidiary Archstone-Smith Operating Trust, were priced before the open on July 11 at 98.75 with a coupon of 4% and an initial exchange premium of 22%.

Each note may be exchanged for 15.7206 Archstone-Smith shares, an initial exchange price of $63.6108. Archstone-Smith stock closed at $52.14 on Monday.

The exchangeables are non-callable for the first five years and are callable after that only if the issuer has paid at least 10 semiannual interest payments. There are puts in years five, 10, 15, 20 and 25.

The notes have a contingent exchange hurdle at 130% of the exchange price.

The notes have dividend protection for quarterly payouts above 43.5 cents and have takeover protection in the form of a ratio adjustment and a change-of-control put.

Archstone-Smith is an Englewood, Colo.-based real estate investment trust with a portfolio of apartment communities operated under the Archstone and Charles E. Smith brands.

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