K2 Inc. announced that the company has entered into an agreement, subject to customary conditions, to privately place $75 million principal amount of 5% convertible senior notes due June 2010. The senior, unsecured notes will be convertible into approximately 5.7 million shares of K2 common stock at a conversion price of $13.14 per share. The placement of the notes is expected to close on June 10, 2003.
K2 intends to use the net proceeds to repay debt under its $205 million revolving credit facility, which will increase the company’s borrowing availability under this credit facility, and for general corporate purposes.
The convertible notes will be offered to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933. The notes will not be registered under the Securities Act. Unless so registered, the notes may not be offered or sold in the United States except pursuant to an exemption from, agreed to or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. This news release does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the convertible notes in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.