CNET Networks extends consent solicitation for 0.75% convertibles, adds sweetener

By Angela McDaniels

Seattle, Oct. 11 - CNET Networks, Inc. extended the consent solicitation for its $125 million outstanding 0.75% senior convertible notes to midnight ET on Oct. 18 from midnight ET on Oct. 11, according to a company news release.

The company will also extend the call protection period for the notes to April 20, 2011 from April 20, 2009 for holders who consent. This is in addition to CNET's offer to pay an additional 7% special interest on the notes for one year if it receives the required consents.

The company needs consents from holders of 70% of the notes.

CNET began soliciting consents on Sept. 13 to amend the indenture governing the notes to waive reporting requirements related to the company's failure to file its 10-Q report for the quarter ended June 30 on time and the possible delisting of its stock.

Since announcing the failure to file its 10-Q for the second quarter, CNET said it will also be unable to file its 10-Q for the quarter ended Sept. 30 on time and attributed the delay to its independent investigation of stock option granting practices.

Previously, the company announced that it anticipates restating the financial statements for 2003, 2004 and 2005 included in its 10-K filed with the Securities and Exchange on March 16 and its balance sheet as of March 31, and it may need to restate financial statements for additional periods.

Under the proposed amendments, all requirements for the company to report to the trustee or noteholders and any related events of default would be waived.

In addition, consenting noteholders will waive the right to tender their notes in any tender offer that CNET is required to conduct if its stock is delisted.

The waivers under the proposed amendments would apply for one year.

On Aug. 14, CNET received a Nasdaq staff determination note asserting that the company had violated Nasdaq rules and its stock was subject to delisting. In response, the company requested a hearing before the Nasdaq Listing Qualifications Panel.

Pending a decision by the panel, CNET's stock will remain listed on the Nasdaq National Market.

D.F. King & Co., Inc. (800 829-6551 or collect 212 269-5550) is the information agent for the consent solicitation. The solicitation agent is Banc of America Securities LLC, convertibles sales department (800 654-1666 or collect 212 583-8206).

In separate news, CNET estimated its total third-quarter revenues at roughly $92.8 million, which is slightly outside the $93 million to $96 million range the company had predicted.

Accordingly, CNET revised its estimated total revenues for 2006 to between $376 million and $386 million. Previously, the company had expected total revenues of $386 million to $403 million for 2006.

CNET is an internet media company based in San Francisco.

© 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.