By Rebecca Melvin
New York, Feb. 1 - Avatar Holdings Inc. priced $100 million five-year convertible senior notes at par late Monday to yield 7.5% with an initial conversion premium of 50%, according to a news release.
The registered, off-the-shelf offering was sold via bookrunner Barclays Capital Inc.
Proceeds will be used for general corporate purposes, including repayment of debt, including Avatar's 4.5% convertible senior notes, and to potential new acquisitions of real estate and real estate-related assets.
The notes are non-callable until Feb. 15, 2014 and then provisionally callable subject to a 130% price hurdle.
Holders can put the notes at par plus interest upon a fundamental change or after three years, on Feb. 15, 2014. Fifty percent of the notes can be put upon a breach of certain financial covenants at 110% of par and unpaid interest.
Avatar is a Coral Gables, Fla., real estate development company with adult community operations in Florida and Arizona.
| Issuer: | Avatar Holdings Inc.
|
| Issue: | Convertible senior notes
|
| Amount: | $100 million
|
| Maturity: | Feb. 15, 2016
|
| Bookrunner: | Barclays Capital Inc.
|
| Coupon: | 7.5%
|
| Price: | Par
|
| Yield: | 7.5%
|
| Conversion premium: | 50%
|
| Conversion price: | $30.00
|
| Conversion ratio: | 33.3333 shares per bond
|
| Calls: | Non-callable for three years until Feb. 15, 2014, then provisionally callable subject to a 130% price hurdle
|
| Puts: | Upon a fundamental change or after three years on Feb. 15, 2014; 50% put at 110% of par upon breach of certain financial covenants
|
| Pricing date: | Jan. 31
|
| Settlement date: | Feb. 4
|
| Distribution: | Registered, off the shelf
|
| Stock symbol: | Nasdaq: AVTR
|
| Stock reference price: | $19.97
|
| Market capitalization: | $251 million
|
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