CKE Restaurants converts additional $38.5 million 4% convertibles at request of noteholders

By Jennifer Chiou

New York, Aug. 24 - CKE Restaurants Inc. said it converted $38.5 million of its 4% convertible subordinated notes due 2023 into 4,377,131 shares after receiving unsolicited offers from noteholders.

CKE also made a cash payment to the holders that included accrued interest and $2.8 million as an inducement to convert and in lieu of future interest on the notes, according to a company news release.

The company added that the conversion reduced the amount of notes outstanding by about 74%.

On Aug. 8, the company issued 4,465,569 shares in exchange for $39.2 million of the convertibles after noteholders elected to convert prior to the notes' first call date in 2008.

The issued shares will not impact diluted shares outstanding because these shares were already included in the calculation of diluted shares outstanding, according to the release.

CKE is a Carpinteria, Calif., owner, operator, franchiser and licenser of quick-service restaurants.

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