CKE Restaurants $75 million convertible preferred talked at 4.0-4.5%, up 23-27%

By Ronda Fears

Nashville, Sept. 22 - CKE Restaurants Inc. launched $75 million of 20-year convertible notes Monday, talked to yield 4.0% to 4.5% with a 23% to 27% initial conversion premium.

The Rule 144A deal is scheduled to price after the close Tuesday, via bookrunner Citigroup.

The issue will be non-callable for five years with puts in years five, 10 and 15 in cash only. Holders also will have dividend protection through conversion rate adjustments.

There is a 110% contingent conversion hurdle.

There is a $15 million greenshoe available.

The company plans to use proceeds to repay and retire a portion of its 4.25% convertible subordinated notes due 2004. The company intends to retire the remainder of that issue by replacing its existing $100 million senior credit facility with a new $150-175 million facility and drawing down those funds.

CKE Restaurants shares closed Monday down 16c, or 2.04%, to $7.69.

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