WASHINGTON (dpa-AFX) - Cracker Barrel Old Country Store Inc. (CBRL) announced the upsizing and pricing of its offering of $300.0 million aggregate principal amount of 1.75% convertible senior notes due 2030 in a private offering. The aggregate principal amount of the notes to be issued in the offering was increased to $300.0 million from the previously announced $275.0 million.
Cracker Barrel also granted the initial purchasers of the notes an option to purchase, for delivery within a period of 13 days from, and including, the date the notes are first issued, up to an additional $45.0 million aggregate principal amount of notes.
The issuance and sale of the notes are scheduled to settle on or about June 13, 2025, subject to customary closing conditions.
According to the company, the notes will be senior, unsecured obligations of Cracker Barrel and will accrue interest at a rate of 1.75% per annum, payable semi-annually in arrears on March 15 and September 15 of each year, beginning on March 15, 2026. The notes will mature on September 15, 2030, unless earlier converted, repurchased or redeemed. Before March 15, 2030, the notes will be convertible by the noteholders only under certain circumstances and during certain periods, and irrespective of those circumstances, will be convertible by the noteholders on or after March 15, 2030 until the close of business on the second scheduled trading day immediately preceding the maturity date.
The initial conversion rate will be 13.8455 shares of Cracker Barrel's common stock per $1,000 principal amount of notes.
Cracker Barrel estimates that the net proceeds from the offering will be approximately $290.1 million or approximately $333.9 million if the initial purchasers fully exercise their option to purchase additional notes, after deducting the initial purchasers' discounts and commissions and Cracker Barrel's estimated offering expenses.
Cracker Barrel intends to use approximately $14.3 million or approximately $16.5 million if the initial purchasers fully exercise their option to purchase additional notes of the net proceeds from this offering to pay the cost of entering into the capped call transactions.
In addition, Cracker Barrel said it intends to use approximately $145.9 million of the net proceeds to repurchase $150.0 million aggregate principal amount of its outstanding 0.625% convertible senior notes due 2026 concurrently with the offering of the notes in separate, privately negotiated transactions effected through one of the initial purchasers of the notes or its affiliate, as Cracker Barrel's agent.
Cracker Barrel intends to use any remaining net proceeds for general corporate purposes, which may include the redemption or repayment of any of Cracker Barrel's existing outstanding indebtedness, including indebtedness outstanding under its revolving credit facility.
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