By Angela McDaniels
Tacoma, Wash., Sept. 18 - GMX Resources Inc. received tenders for $24.9 million principal amount, or 47.9%, of its 5% senior convertible notes due 2013 and $38 million principal amount, or 44%, of its 4.5% senior convertible notes due 2015, according to a company news release.
An exchange offer for the convertibles began Aug. 9 and ended at 5 p.m. ET on Sept. 17.
Holders will receive $1,000 principal amount of new 9% senior secured second-priority notes due March 2018 and 288 shares of common stock in exchange for each $1,000 principal amount of 5% convertibles exchanged.
The company will issue $700 principal amount of the new notes in exchange for each $1,000 principal amount of 4.5% convertibles exchanged.
Holders also will receive accrued interest through the settlement date, which is expected to be Sept. 19.
In total, the company will issue $24.9 million principal amount of new notes and 7,176,384 shares in exchange for 5% convertibles and $26.6 million principal amount of new notes in exchange for 4.5% convertibles.
After the exchange offer, $27.1 million principal amount of 5% convertibles, $48.3 million principal amount of 4.5% convertibles and $51.5 million principal amount of new notes will be outstanding.
Through the second anniversary of the settlement date, the company may pay interest on the new notes in common stock instead of cash. The number of shares is based on a 10-day volume-weighted average share price, discounted to yield the equivalent of a 12% interest rate.
The exchange offer was originally scheduled to expire at 11:59 p.m. ET on Sept. 6. The company later extended it to 5 p.m. ET on Sept. 10 to allow additional time for the Securities and Exchange Commission to complete the qualification of the indenture governing the new notes under the Trust Indenture Act.
On Sept. 11, the company changed the minimum tender condition and extended the expiration date to 5 p.m. ET on Sept. 17.
As of 5 p.m. ET on Sept. 10, holders had tendered $24.9 million of 5% convertibles and $36.9 million of 4.5% convertibles.
Under the modified minimum tender condition, the company's obligation to accept 5% convertibles was conditioned on the receipt of tenders for at least $22 million - lowered from $30 million - principal amount of 5% convertibles.
Global Bondholder Services Corp. (866 804-2200 or, for banks and brokers only, 212 430-3774) was the information agent.
GMX is an Oklahoma City-based natural gas exploration and production company.
| Issuer: | GMX Resources Inc.
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| Issue: | Senior secured second-priority notes
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| Amount: | $51.5 million
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| Maturity: | March 2018
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| Coupon: | 9%, payable in stock or cash at company's option through second anniversary
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| Settlement date: | Sept. 19
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