Silicon Graphics extends exchange to allow for further discussions

New York, June 16 - Silicon Graphics, Inc. said it extended its offer to exchange new securities for its 5.25% senior convertible notes due 2004 to midnight ET on June 27 from June 13.

The Mountain View, Calif. company said the extension is to allow for further discussions that began last week with a group of significant bondholders about revising the terms of the offer.

The discussions may lead Silicon Graphics to amend the conversion price of the new convertibles it is offering, add provisions to allow holders to monitor its near-term financial performance and include certain governance-related matters, the company said.

Silicon Graphics noted that any changes would be available to all holders of the existing convertibles.

As of midnight ET on June 13, the company said $110.7 million or about 48% of the $230 million of the existing convertibles outstanding had been tendered. The exchange offer is subject to at least 90% being tendered.

Of the notes tendered, $98 million were for new 11.75% senior notes and $12.6 million for new convertibles.

As previously announced, Silicon Graphics is offering new debt securities with a higher coupon and longer maturity in exchange for the existing convertibles.

The company said in a filing with the Securities and Exchange Commission that it is carrying out the exchange because it does not expect to generate enough cash to be able to repay the existing convertibles at maturity. It had $141 million of cash at March 28.

Holders who participate will receive either new 11.75% senior notes due July 2009 that are not convertible into stock or new 6.5% senior convertible notes due July 2009 convertible at a price of $3.00 per share. The existing notes convert at $18.70.

The 11.75% notes will be redeemable at 105 in 2003, declining to par in 2008. The 6.5% convertibles will be redeemable at par after three years subject to a 150% hurdle or at par with no hurdle after four years.

For either series of security the exchange will be on a one-for-one basis.

Silicon Graphics will issue no more than $120 million of the new convertibles in the exchange. If more than $120 million of the old convertibles are tendered for new convertibles the company will issue the new convertibles on a pro rata basis.

Silicon Graphics said that Highfields Capital, which holds approximately $68 million principal amount or 29% of the existing notes, has agreed to tender and not to withdraw its notes in exchange for 11.75% senior notes.

The information agent for the exchange is MacKenzie Partners (800 322-2885).

Kohl's says almost all LYONs put back

New York, June 16 - Kohl's Corp. said Friday that holders of 99.5% of its outstanding Liquid Yield Option Notes due 2020 exercised their option to put the notes back to the company.

The put option expired at 5.00 p.m. ET on June 12.

The Menomonee Falls, Wis. company said it is paying for the notes with cash at a total cost of $345 million, which will be paid from available funds.

The remaining LYONs are callable at any time.

Lamar calls 5.25% convertibles

New York, June 16 - Lamar Advertising Co. said it will redeem its $287.5 million principal amount of outstanding 5.25% convertible notes due 2006

The Baton Rouge, La. advertising company will redeem the convertibles on July 16 at a price of 103% of par plus accrued interest through July 15.

Holders can convert the notes into 21.6216 shares per $1,000 principal amount until 5.00 p.m. ET on July 15. Lamar stock closed at $36.30 Monday.

The redemption will be funded from Lamar's recent sale of $287.5 million 2.875% convertible plus cash on hand.

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