Stillwater’s 1.75% convertibles putable due to fundamental change

By Marisa Wong

Morgantown, W.Va., May 17 – Stillwater Mining Co. issued a fundamental change repurchase right notice and a notice of right to convert on Wednesday to holders of its 1.75% convertible senior notes due 2032, according to an 8-K filing with the Securities and Exchange Commission.

As a result of Stillwater’s merger with Sibanye Gold Ltd., which closed on May 4, holders of the 2032 notes have the right to put any and all of their notes.

The company will repurchase any notes that are surrendered for repurchase prior to 5 p.m. ET on June 14. The fundamental change repurchase price is par plus accrued interest to the repurchase date of June 15.

In addition, under the terms and conditions of the indenture governing the notes, holders have the right to surrender their notes for conversion to Continental Stock Transfer & Trust Co. as conversion agent at any time from and including April 27 until June 15.

For notes surrendered for conversion at any time from and including May 4 until June 14, the make-whole conversion period, the cash amount payable is fixed at 75.2905 for each $1,000 principal amount of the notes, multiplied by the merger consideration of $18.00.

For notes surrendered for conversion before or after the make-whole conversion period, the cash amount payable is 62.9664 for each $1,000 principal amount, multiplied by $18.00.

Assuming that each holder exercises the fundamental change repurchase right, the company would be obligated to make aggregate payments of roughly $336.1 million.

Assuming that each holder exercises the conversion right in connection with the merger during the make-whole conversion period, the company would be obligated to make aggregate payments of about $454.2 million.

Assuming that each holder exercises the conversion right in connection with the merger during the conversion period but not during the make-whole conversion period, the company would be obligated to make aggregate payments of roughly $379.9 million.

Holders may only exercise either the fundamental change repurchase right or the conversion right but not both, the filing noted.

Stillwater is a Billings, Mont.-based producer of palladium and platinum.

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