Horizon Lines Completes Mandatory Debt Conversion

press release
Thursday, January 12, 2012

$49.7 Million of 6.00% Series B Mandatorily Convertible Senior Secured Notes Exchanged for Common Stock and Warrants.

 

Horizon Lines, Inc. has announced that it has completed the mandatory debt-to-equity conversion of approximately $49.7 million of the company's 6.00% Series B Mandatorily Convertible Senior Secured Notes (the "Series B Notes").  The mandatory conversion reduces debt, lowers annualized interest payments and is expected to increase the value of the company's shares outstanding.  Under the terms of the company's recapitalization plan that was undertaken in October 2011, the Series B Notes are mandatorily convertible into shares of common stock or warrants in two equal installments on the three-month and nine-month anniversaries of their issuance, subject to certain conditions. 

 

In accordance with these terms, on January 10, 2012, the company mandatorily converted approximately $49.7 million of the Series B Notes at a conversion rate of 54.7196 shares of common stock (reflecting the 1-for-25 reverse stock split of the company's common stock effective December 7, 2011) per $1,000 principal amount of Series B Notes.  Approximately $18.5 million of the Series B Notes were converted into 1,014,839 shares of common stock with the remainder being converted into warrants exercisable into shares of common stock.  The distribution of common stock and warrants was based upon the U.S. citizenship verifications of the holders of the Series B Notes. Foreign holders, or holders who did not provide proof of U.S. citizenship, received warrants exercisable by U.S. citizens into an applicable quantity of common stock.  All fractional interests were paid in cash.

 

"This mandatory conversion reduces the company's annualized interest payments by approximately $3.0 million and represents a major step in deleveraging the company's balance sheet under the opportunities provided by our new capital structure," said Stephen H. Fraser, President and Chief Executive Officer.  "Affording us the ability to decrease debt is an essential component of the refinancing structure that we put in place last October with the help of our note holders. Issuing stock as a means to replace debt also allows us to immediately increase the total market value of our equity, as well as build shareholder value over time."

 

Subject to certain conditions, the remaining approximately $49.7 million in aggregate principal amount of the Series B Notes is scheduled to be mandatorily converted into shares of common stock and warrants in July 2012. The Series B Notes will be automatically converted into 6.00% Series A Convertible Senior Secured Notes due 2017 on October 5, 2012 if the company is unable to effect mandatory conversion before then.

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter January 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Delia Succeeds Schmidt as Ohmsett Program Manager

MAR Incorporated has named John Delia the Program manager for Ohmsett – The National Oil Spill Response Research & Renewable Energy Test Facility, succeeding Bill Schmidt who retired in December 2015.

SBM Offshore: US Authorities Reopen Corruption Probe

SBM Offshore, the world's top oil production ship leasing company, said on Wednesday that U.S. authorities had re-opened an inquiry into bribery allegations involving the Dutch company.

The Next Generation of Hull Performance Management

Hull performance monitoring solutions can offer significant fuel savings potential, a fact that is prompting growing interest from the maritime industry. To spur

Legal

SBM Offshore: US Authorities Reopen Corruption Probe

SBM Offshore, the world's top oil production ship leasing company, said on Wednesday that U.S. authorities had re-opened an inquiry into bribery allegations involving the Dutch company.

Caterpillar Names Official Dealer for Cuba

Caterpillar Inc. has named privately owned Puerto Rico-based company Rimco as the official Cat dealer for Cuba. Rimco, a longtime Cat partner, currently serves

U.S. Okays ConocoPhillips Alaska LNG Exports

The U.S. Department of Energy approved ConocoPhillips' application to export about 40 billion cubic feet of natural gas from its Kenai liquefied natural gas export

Finance

Funding Secured for Project to Deepen the Delaware River

Dennis Rochford, president of the Maritime Exchange for the Delaware River and Bay, announced that President Obama’s FY17 proposed budget includes $33 million for the Delaware River Deepening Project.

Top 10 Shipowning Nations by Value

VesselsValue has provided a list ranking the top shipowning nations by value, including the percentage change difference against 2015 figures. Although the

Port of Hamburg Reports Bulk Cargo Jump in 2015

The Port of Hamburg reports higher bulk cargo throughput and strong growth in rail and inland waterway seaport-hinterland traffic in 2015 – downturn in container handling.

Container Ships

Sydney Deep Water Port Project Named NOVAPORTE

The Harbor Port Development Partners (HPDP) and the Port of Sydney announce the new brand for Sydney’s new container terminal: NOVAPORTE and its adjacent logistics park NOVAZONE.

Top 10 Shipowning Nations by Value

VesselsValue has provided a list ranking the top shipowning nations by value, including the percentage change difference against 2015 figures. Although the

Port of Hamburg Reports Bulk Cargo Jump in 2015

The Port of Hamburg reports higher bulk cargo throughput and strong growth in rail and inland waterway seaport-hinterland traffic in 2015 – downturn in container handling.

 
 
Maritime Security Maritime Standards Naval Architecture Offshore Oil Pipelines Pod Propulsion Port Authority Shipbuilding / Vessel Construction Sonar Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1134 sec (9 req/sec)