QUINCY, Ill. (Jan. 28, 2013) — Titan International Inc. has privately negotiated an exchange agreement on its convertible senior notes.
The Quincy-based company said it was approached by a note holder of Titan's 5.625 percent Convertible Senior Subordinated Notes due 2017 with an offer to exchange the note holder's convertible notes for the company's common stock. The two parties privately negotiated an agreement to exchange approximately $52.7 million in aggregate principal amount of the convertible notes for approximately 4.9 million shares of the company's common stock plus a cash payment totaling $14.2 million for the premium on the principal and unpaid interest to maturity.
Titan said its total indebtedness will be reduced by approximately $52.7 million and annual interest payments will be reduced by about $3.2 million. Following the exchange, approximately $60.2 million aggregate principal amount of the convertible notes will remain outstanding.
"The issuance of shares of common stock in the exchange transaction is exempt from registration under the Securities Act of 1933 pursuant to the provisions of Section 3(a)(9) thereof, as securities exchanged by the issuer with its existing security holders exclusively where no commission or other remuneration is paid or given directly or indirectly for soliciting such exchange," Titan said.
The shares of common stock issued in the exchange transaction will be unrestricted securities upon issuance.
Titan is a holding company that owns subsidiaries supplying wheels, tires and assemblies and undercarriage products for off-highway equipment used in agricultural, earthmoving/construction and consumer applications.