Oil States Announces Offering of $135 Million Principal Amount of Convertible Senior Notes Due 2026
March 16 2021 - 4:45PM
Oil States International, Inc. (NYSE:OIS) (the “Company”) announced
today that it intends to offer, subject to market and other
conditions, $135 million aggregate principal amount of convertible
senior notes due 2026 (the “Notes”) in a private offering to
persons reasonably believed to be qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933, as amended
(the “Securities Act”). The Company also expects to grant the
initial purchasers of the Notes an option to purchase, during a
13-day period beginning on, and including, the first date on which
the Notes are issued, up to an additional $15 million aggregate
principal amount of the Notes.
The Notes will be senior, unsecured obligations of the Company,
with interest payable semi-annually in arrears, and will be
convertible by the holder, subject to various conditions, into
cash, shares of the Company’s common stock, or a combination
thereof, at the Company’s election. The Company will have the
option to redeem all or any portion of the Notes on or after April
6, 2024, if certain conditions (including the Company’s common
stock trading above a specified level) are met, at a redemption
price equal to 100% of the principal amount plus accrued and unpaid
interest to, but excluding, the redemption date. The Notes are
expected to mature on April 1, 2026, unless repurchased, redeemed
or converted in accordance with their terms prior to such date. The
terms of the Notes, including the interest rate, initial conversion
rate and other terms, will be determined at the pricing of the
offering.
The Company intends to use a portion of net proceeds from the
offering of Notes to repurchase for cash a portion of its
outstanding 1.50% convertible senior notes due 2023 (the “2023
Convertible Notes”) in the concurrent note repurchases (as defined
below) and to pay fees and expenses related thereto. The Company
intends to use any remaining net proceeds for general corporate
purposes, which may include further repurchases of its 2023
Convertible Notes and/or repayment of borrowings outstanding under
the Company’s asset-based revolving credit facility.
Contemporaneously with the pricing of the Notes in the offering,
the Company expects to enter into separate and individually
negotiated transactions (the “concurrent note repurchases”) with
certain holders of the 2023 Convertible Notes to repurchase for
cash a portion of the 2023 Convertible Notes on terms to be
negotiated with each holder. Such terms will depend on several
factors, including the market price of the Company’s common stock
and the trading price of the 2023 Convertible Notes at the time of
each such concurrent note repurchase. No assurance can be given as
to how much, if any, of the 2023 Convertible Notes will be
repurchased or the terms on which they will be repurchased.
The Company expects that certain holders of any 2023 Convertible
Notes that the Company agrees to repurchase that have hedged their
equity price risk with respect to such 2023 Convertible Notes (the
“hedged holders”) will, concurrently with the pricing of the Notes,
unwind all or part of their hedge positions by buying the Company’s
common stock and/or entering into or unwinding various derivative
transactions with respect to the Company’s common stock. The amount
of the Company’s common stock to be purchased by the hedged holders
may be substantial in relation to the historical average daily
trading volume of the Company’s common stock. Any repurchase of the
2023 Convertible Notes and the potential related market activities
by holders of the 2023 Convertible Notes participating in the
concurrent note repurchases could increase (or reduce the size of
any decrease in) the market price of the Company’s common stock,
which may affect the trading price of the Notes at that time and
the initial conversion price of the Notes. The Company cannot
predict the magnitude of such market activity or the overall effect
it will have on the price of the Notes or the Company’s common
stock.
The offer and sale of the Notes and any shares of the Company’s
common stock issuable upon conversion of the Notes have not been
and are not expected to be registered under the Securities Act or
the securities laws of any other jurisdiction, and the Notes and
any such shares may not be offered or sold in the United States
absent registration or an applicable exemption from such
registration requirements.
This press release does not constitute an offer to sell, or the
solicitation of an offer to buy, any securities, nor shall it
constitute an offer, solicitation or sale in any jurisdiction in
which such offer, solicitation or sale is unlawful. Any offer, if
at all, will be made only pursuant to Rule 144A under the
Securities Act.
Forward Looking Statements
The foregoing contains forward-looking
statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of
1934. Forward-looking statements are those that do not state
historical facts and are, therefore, inherently subject to risks
and uncertainties. The forward-looking statements included herein
are based on current expectations and entail various risks and
uncertainties that could cause actual results to differ materially
from those forward-looking statements. Such risks and uncertainties
include, among other things, the Company’s ability to consummate
the offering on acceptable terms or at all, the Company’s ability
to effectuate the concurrent note repurchases or future note
repurchases of the 2023 Convertible Notes, the other risks
associated with the general nature of the energy service industry
and other factors discussed in the “Business” and “Risk Factors”
sections of the Company’s Annual Report on Form 10-K for the year
ended December 31, 2020 and the subsequently filed Periodic Reports
on Form 8-K. Readers are cautioned not to place undue reliance on
forward-looking statements, which speak only as of the date hereof,
and, except as required by law, the Company undertakes no
obligation to update those statements or to publicly announce the
results of any revisions to any of those statements to reflect
future events or developments.
SOURCE: Oil States International, Inc.
Contact:
713-652-0582
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