Northrop Grumman calls series B convertible preferreds

By Jennifer Chiou

New York, Feb. 20 - Northrop Grumman Corp. announced the redemption of all 3.5 million shares of its series B convertible preferred stock.

The Los Angeles aerospace and defense company said that on April 4 each preferred will be redeemed for shares of Northrop common stock.

Under the redemption ratio formula, holders will receive a number of common shares equal to $100, the liquidation value of each preferred share, plus $1.536111 of accrued dividends, divided by the average of the closing prices of the common stock for the five consecutive trading days ending April 2.

Alternatively, holders of the preferreds may exercise their right to convert each preferred into 1.822267 shares of common stock at any time prior to 5 p.m. ET on April 3. Those who convert will not receive accrued dividends.

Northrop said that it will pay a dividend to holders of record as of March 3.

The redemption ratio for the preferred stock cannot be determined until April 2, but had the redemption taken place on Dec. 31, each preferred share would have been redeemed for 1.261 common shares.

Computershare Trust Co. is the redemption and conversion agent (800 546-5141 or call collect 781 575-2765).

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