Campus Crest Communities, Inc. (NYSE:CCG) (the “Company”) announced today that Campus Crest Communities Operating Partnership, LP, the operating partnership through which the Company conducts its operations (the “Operating Partnership”), has agreed to sell a private offering of $85 million aggregate principal amount of its 4.75% Exchangeable Senior Notes due 2018 (“Notes”). The Operating Partnership granted the initial purchasers a 30-day option to purchase up to an additional $15 million aggregate principal amount of the Notes.
The Notes will be senior unsecured obligations of the Operating Partnership. The Company will guarantee the payment of amounts due on the Notes. The offering is expected to close on October 9th, 2013, subject to the satisfaction of certain closing conditions.
Interest on the Notes will be payable semi-annually on April 15 and October 15, beginning April 15, 2014. The Notes will mature on October 15, 2018, unless repurchased or exchanged in accordance with their terms prior to such date.
Upon exchange of Notes, the Operating Partnership will deliver, cash, shares of Campus Crest common stock or a combination of both, at an initial exchange rate of 79.6020 shares per $1,000 principal amount of notes (equivalent to an initial exchange price of approximately $12.56 per share of Campus Crest common stock). At any time prior to July 15, 2018, the operating partnership may irrevocably elect, in its sole discretion without the consent of the holders of the Notes, to settle all of its future exchange obligation entirely in shares of Campus Crest common stock.The Operating Partnership intends to use the net proceeds from this offering for the repayment of debt, future development or for other general corporate and working capital purposes. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the Notes, nor shall there be any sale of such Notes in any state or other jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such state or other jurisdiction.