ANNAPOLIS, Md., May 2, 2013 /PRNewswire/
-- TeleCommunication Systems, Inc. (TCS) (NASDAQ:TSYS),
a world leader in highly reliable and secure mobile communication
technology, has entered into privately-negotiated exchange
agreements with noteholders to retire $50
million in aggregate principal of its outstanding 4.5%
Convertible Senior Notes (the "Original Notes") due in 2014. The
Original Notes will be exchanged for $50
million in aggregate principal of new 7.75% Convertible
Senior Notes (the "New Notes") due in 2018. The closing of the
exchange transactions is expected to occur on May 7, 2013. Following these transactions,
$43.5 million in aggregate principal
amount of the Original Notes will remain outstanding.
"By extending the maturity of $50
million of our convertible notes from November 2014 to June
2018, we have laddered our debt maturities and enhanced our
financial flexibility," said Tom
Brandt, TCS senior vice president and CFO. "The New Notes
are unsecured, and include a call feature."
Holders may convert the New Notes at their option on any day
prior to the close of business on the second "scheduled trading
day" (as defined in the indenture governing the New Notes)
immediately preceding June 30, 2018.
The initial conversion price of the New Notes is unchanged from the
Original Notes and remains $10.348
per share of Class A common stock which is equivalent to a
conversion rate of approximately 96.637 shares of Class A common
stock per $1,000 principal amount of
New Notes. The company may redeem some or all of the New Notes at
any time on or after June 30, 2014 at
the redemption prices set forth in the indenture governing the New
Notes plus accrued and unpaid interest to the redemption date.
Shares of the company's Class A common stock, into which the New
Notes are convertible, have been reserved for issuance by the
company and will be listed on the NASDAQ Global Select Market.
The Company offered the New Notes to certain holders of the
Original Notes in reliance on the exemption from registration
provided by Section 4(2) of the Securities Act of 1933, as
amended.
No Solicitation or Registration
This press
release does not constitute an offer to sell, or a solicitation of
an offer to buy, any security and shall not constitute an offer,
solicitation or sale in any jurisdiction in which such offering
would be unlawful.
About TeleCommunication Systems, Inc.
TeleCommunication Systems, Inc. (TCS) (NASDAQ: TSYS) is a world
leader in highly reliable and secure mobile communication
technology.
Forward-looking Statements
This
announcement contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities and Exchange Act of 1934, as amended.
These statements are based upon TCS' current expectations and
assumptions that are subject to a number of risks and uncertainties
that would cause actual results to differ materially from those
anticipated. The words, "believe," "expect," "intend,"
"anticipate," "should," "prospect," and variations of such words
and similar expressions identify forward-looking statements, but
their absence does not mean that the statement is not
forward-looking. Statements in this announcement that are
forward-looking include, but are not limited to TCS'
expectation to close the exchange transaction on May 7, 2013.
Additional risks and uncertainties are described in the
company's filings with the Securities and Exchange Commission
(SEC). These include without limitation risks and uncertainties
relating to the company's financial results and the ability of the
company to (i) sustain profitability, (ii) accurately assess
impairment triggering events related to our intangibles, including
goodwill; (iii) continue to rely on its customers and other third
parties to provide additional products and services that create a
demand for its products and services, and to do so at prices that
will allow us to continue to fund our operations, (iv) conduct its
business in foreign countries, (v) adapt and integrate new
technologies into its products and adequately expand its data
centers and data delivery systems, (vi) expand its sales and
business offerings in the wireless communications industry, (vii)
develop software and provide services without any errors or defects
and with adequate security threat protections, (viii) protect its
intellectual property rights, (ix) have sufficient capital
resources to fund its operations, (x) not incur substantial costs
from product liability and IP infringement claims and
indemnification demands relating to its software, (xi) implement
its sales and marketing strategy, and (xii) successfully integrate
the assets and personnel obtained in its acquisitions and
investments. Existing and prospective investors are cautioned not
to place undue reliance on these forward-looking statements, which
speak only as of the date hereof. The company undertakes no
obligation to update or revise the information in this press
release, whether as a result of new information, future events or
circumstances, or otherwise.
(Logo: http://photos.prnewswire.com/prnh/20120503/PH99996LOGO
)
Company
Contacts:
|
|
Tom
Brandt
|
Scott
Liolios or Matt Glover
|
Senior
Vice President and CFO
|
Investor
Relations
|
TeleCommunication Systems, Inc.
|
Liolios
Group, Inc.
|
Tel
410-280-1001
|
Tel
949-574-3860
|
tbrandt@telecomsys.com
|
info@liolios.com
|
SOURCE TeleCommunication Systems, Inc.