By Sheri Kasprzak and Kenneth Lim
New York, March 14 - LSB Industries, Inc. said it settled an $18 million private placement of convertible debentures under Rule 144A, pricing them to yield 7% with a 27% initial conversion premium.
The debentures, purchased by six institutions, are due March 1, 2011 and are convertible between now and Sept. 1 at $8.00. From Sept. 1 through March 1, 2009, the conversion price will change every six months beginning at $7.08 and ending at $7.74. From March 1, 2009 through maturity, the debentures will be convertible at $8.00 each.
The initial conversion price is a 27% premium to the company's closing stock price of $6.30 on March 13.
J. Giordano Securities Group was the bookrunner for the offering.
LSB intends to use the proceeds from the deal to repay existing debt. The rest will be used for general corporate purposes.
Based in Oklahoma City, LSB manufactures climate-control products.
| Issuer: | LSB Industries, Inc.
|
| Issue: | Senior subordinated convertible debentures
|
| Amount: | $18 million
|
| Maturity: | March 1, 2011
|
| Coupon: | 7%
|
| Price: | Par
|
| Yield: | 7%
|
| Conversion premium: | 27%
|
| Conversion price: | $8.00 (initially); after Sept. 1, 2006, the conversion price reduces to $7.08 and rises every six months to $7.74 on Feb. 28, 2009. From March 1, 2009 through maturity, the debentures are convertible at $8.00
|
| Conversion ratio: | 125
|
| Dividend protection: | Yes
|
| Takeover protection: | Premium make-whole
|
| Hard-call protection: | Three years
|
| Puts: | None
|
| Bookrunner: | J. Giordano Securities Group
|
| Settlement date: | March 14
|
| Distribution: | Rule 144A
|
| Stock symbol: | AMEX: LXU
|
| Stock price: | $6.44 at close March 14
|
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