Iconix Brand Group, Inc. Announces Pricing for Convertible Senior Subordinated Notes
June 15 2007 - 8:30AM
PR Newswire (US)
NEW YORK, June 15 /PRNewswire-FirstCall/ -- Iconix Brand Group,
Inc. (NASDAQ:ICON) today announced the pricing of its offering of
$250 million aggregate principal amount of Convertible Senior
Subordinated Notes due 2012 (the "Notes") in an offering pursuant
to Rule 144A under the Securities Act of 1933, as amended (the
"Securities Act"), through the initial purchasers of the Notes.
Iconix also granted the initial purchasers of the Notes an option
to purchase up to an additional $37.5 million aggregate principal
amount of Notes solely to cover over-allotments, if any. The
issuance of the Notes is expected to close on June 20, 2007. If
certain conditions are met, the Notes will be convertible into cash
up to the principal amount of the Notes and, with respect to any
excess conversion value, into cash, shares of Iconix common stock
or a combination of cash and common stock, at Iconix' option. The
Notes will pay interest semiannually at a rate of 1.875% per annum.
The Notes will be convertible at an initial conversion rate of
36.2845 shares of common stock per $1,000 principal amount of
Notes, which is equal to an initial conversion price of
approximately $27.56 per share. This represents a 30% conversion
premium based on the last reported sale price of $21.20 per share
on the NASDAQ Global Select Market on June 14, 2007. Iconix
estimates that the net proceeds from the offering of Notes will be
approximately $243.4 million after deducting the initial
purchasers' discount and estimated offering expenses (approximately
$280.0 million if the initial purchasers exercise in full the
over-allotment option). Iconix intends to use a portion of the net
offering proceeds to fund convertible note hedge transactions to be
entered into with affiliates of the initial purchasers, which
transactions are intended to offset Iconix' exposure to potential
dilution upon conversion of the Notes. Iconix will also enter into
separate warrant transactions with affiliates of the initial
purchasers that, together with the convertible note hedge
transactions, will have the effect of increasing the effective
conversion price to Iconix to approximately $42.40, which
represents a 100% conversion premium. Iconix plans to use the
remaining net proceeds from the note offering to invest in or
acquire new brands through mergers, stock or asset purchases and/or
other strategic relationships, although it has no present
commitments or agreements with respect to any such investment or
acquisition, and for general corporate purposes. In connection with
the convertible note hedge and warrant transactions, the hedge
counterparties have advised Iconix that they or their affiliates
intend to enter into various derivative transactions with respect
to the common stock of Iconix, and may purchase our common stock,
concurrently with or shortly following pricing of the Notes. These
activities could have the effect of increasing or preventing a
decline in the price of the common stock of Iconix concurrently or
following the pricing of the Notes. In addition, the hedge
counterparties or their affiliates may from time to time, following
the pricing of the Notes, enter into or unwind various derivative
transactions with respect to the common stock of Iconix and/or
purchase or sell common stock of Iconix in secondary market
transactions. These activities could have the effect of decreasing
the price of the common stock of Iconix and could affect the price
of the Notes. The convertible note hedge transactions are intended
to reduce potential dilution to Iconix' common stock upon potential
future conversion of the Notes. This notice does not constitute an
offer to sell or the solicitation of an offer to buy securities.
Any offers of the securities will be made only by means of an
offering memorandum. Iconix' issuance of the Notes and the shares
of Iconix common stock issuable upon conversion of the Notes have
not been, and will not be, registered under the Securities Act or
the securities laws of any other jurisdiction. Such securities may
not be offered or sold in the United States absent registration or
an applicable exemption from registration requirements. Certain
statements and information included in this release constitute
"forward-looking statements" within the meaning of the Federal
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of Iconix to be materially different
from any future results, performance or achievements expressed or
implied in such forward-looking statements. Important factors that
could cause actual results to differ materially from the results
expressed or implied in such forward looking statements include the
risk that the notes offering is not timely consummated or is not
consummated at all. Additional discussion of factors that could
cause actual results to differ materially from management's
projections, estimates and expectations is contained in Iconix'
Annual Report on Form 10-K for the fiscal year ended December 31,
2006 and the other documents Iconix files with the SEC from time to
time. Iconix undertakes no duty to update its forward-looking
statements. Contact: Warren Clamen Chief Financial Officer Iconix
Brand Group, Inc. 212-730-0030 DATASOURCE: Iconix Brand Group, Inc.
CONTACT: Warren Clamen, Chief Financial Officer of Iconix Brand
Group, Inc., +1-212-730-0030 Web site: http://iconixbrand.com/
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