CSK Auto Corp. , the parent company of CSK Auto Inc., a specialty retailer in the U.S. automotive aftermarket has completed the pricing of its private placement of $85.0 million aggregate principal amount of exchangeable senior unsecured notes.
In addition, CSK, which operates stores under the Checkers, Shucks and Kragen banners, has granted the initial purchaser of the new exchangeable senior notes an over-allotment option to purchase, within 30 days, up to an additional $15 million aggregate principal amount of notes. All figures in U.S. dollars.
The notes will bear interest at a rate of 4.625% per year until Dec. 15, 2010, and will bear interest at a rate of 4.375% thereafter. The notes are exchangeable into shares of CSK Auto Corp. common stock at an initial exchange rate of 49.8473 shares per $1,000 principal amount of notes (or an initial exchange price of approximately $20.06 per share). The notes will mature on Dec. 15, 2025.
The notes will be redeemable at the company’s option beginning in December 2010 at a redemption price of 100% of their principal amount plus accrued interest. Holders of the notes will have the right to require the company to repurchase some or all of their notes in December of 2010, 2015 and 2020, and in certain other circumstances at a price equal to 100% of their principal amount plus accrued interest. The notes will be guaranteed by CSK Auto Corp. and the company’s subsidiaries.
The company expects to use proceeds from the note offering, together with availability under its existing senior credit facility, to fund the acquisition cost of CSK Auto Corp.’s pending acquisition of Murray’s Inc. If the acquisition of Murray’s Inc. is not consummated, the company intends to use the proceeds of the offering for general corporate purposes. The closing of the sale of the notes is expected to be consummated on or about Dec. 1, 20059, 2005, and is subject to customary conditions and contingencies.
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