ARRIS Announces Right to Convert 2.00% Convertible Senior Notes Due 2026
SUWANEE, Ga., April 12, 2013 /PRNewswire/ -- ARRIS Group, Inc. (NASDAQ: ARRS) today announced that pursuant to the terms of the indenture governing its 2.00% Convertible Senior Notes due 2026 (the "Notes"), the Notes are convertible at the option of the holders (the "Conversion Option") from April 12, 2013 through the close of business on May 29, 2013 (the "Conversion Period").
The Conversion Option is triggered because ARRIS plans to reorganize its business by creating a new holding company structure. The primary purpose of the reorganization is to facilitate ARRIS' previously-announced proposed acquisition of the Motorola Home business from a subsidiary of Google, which ARRIS expects to close on or about April 17, 2013. The business operations of ARRIS and its subsidiaries will not change as a result of the reorganization.
Pursuant to the reorganization, ARRIS will be renamed ARRIS Enterprises, Inc. ("ARRIS Enterprises") and will become a wholly owned subsidiary of the new holding company. Each of the outstanding shares of the capital stock of ARRIS will be converted automatically into one identical share of the new holding company. The new holding company will be named "ARRIS Group, Inc." The anticipated effective date of the reorganization is April 16, 2013.
In order to exercise the Conversion Option, holders must validly surrender the Notes at any time during the Conversion Period. The company has confirmed with The Bank of New York Mellon Trust Company, N.A. (the "Trustee"), which serves as the trustee and conversion agent under the indenture, that, as of the date hereof, all custodians and beneficial holders of the Notes hold the Notes through Depository Trust Company ("DTC") accounts and that there are no outstanding certificated Notes in non-global form. Accordingly, all Notes surrendered for conversion must be delivered through the transmittal procedures of DTC.
In connection with the reorganization, ARRIS Enterprises, the new holding company and the Trustee will execute a supplemental indenture that will provide, among other things, that (i) the conversion value of the Notes will be calculated by reference to the new holding company's common stock, (ii) any shares issuable upon conversion of the Notes will be settled in the new holding company's common stock and (iii) the new holding company will guarantee the obligations of ARRIS Enterprises with respect to the Notes. Upon conversion, holders will receive the consideration provided in the indenture, as supplemented by the supplemental indenture. ARRIS also is distributing a notice to holders regarding the Conversion Option. The notice is available through DTC and the Trustee.
Following the closing of the reorganization, the new holding company will file a copy of the supplemental indenture with the Securities and Exchange Commission and provide a notice to holders of the Notes briefly describing the supplemental indenture. The notice will be available through DTC and the Trustee following the closing of the reorganization.
For additional information regarding how to convert your Notes, contact the Trustee at the offices of The Bank of New York Mellon Trust Company, N.A. at 900 Ashwood Parkway, Suite 425, Atlanta, Georgia 30338, Telephone: (770) 698-5184, Attention: Kristine L. Prall.
Following the closing of the reorganization, holders of the Notes also will have an option to require ARRIS Enterprises to purchase the Notes for the consideration provided for in, and pursuant to the terms of, the indenture and supplemental indenture (the "Put Option"). Additional information regarding the Put Option will be provided to the holders of the Notes through DTC and the Trustee following the closing of the reorganization.
None of the company, its Board of Directors, or its employees or the Trustee has made or is making any representation or recommendation to any holder of Notes as to whether to exercise or refrain from exercising the Conversion Option or the Put Option.
ARRIS is a global communications technology company specializing in the design, engineering and supply of communications and IP technologies that support broadband services for residential and business customers around the world. The company supplies broadband operators with the tools and platforms they need to deliver and monitor advanced video, data and voice subscriber services, including whole home video across multiple screens, ultra high-speed data, personalized advertising and carrier-grade telephony. Headquartered near Atlanta, in Suwanee, Georgia, USA, ARRIS has R&D sales and support offices throughout the world. Information about ARRIS products and services can be found at www.arrisi.com.
This press release contains forward looking statements. These statements include, among others, statements concerning the closing of the acquisition of the Motorola Home business, the closing of the holding company reorganization, the terms of the Notes following the holding company reorganization and the rights and obligations of the parties with respect to the Notes following the holding company reorganization. Statements regarding future events are based on the parties' current expectations. Actual results may differ materially from those suggested by any forward-looking statement. Forward-looking statements are necessarily subject to associated risks related to, among other things, satisfaction of all remaining closing conditions and the conditions for funding under ARRIS' credit facility. Other factors that could cause results to differ from current expectations include: the uncertain current economic climate and financial markets, and their impact on our customers' plans and access to capital; the impact of rapidly changing technologies; the impact of competition on product development and pricing; the ability of ARRIS to react to changes in general industry and market conditions; rights to intellectual property and the current trend toward increasing patent litigation, market trends and the adoption of industry standards; possible acquisitions and dispositions; and consolidations within the telecommunications industry of both the customer and supplier base. These factors are not intended to be an all-encompassing list of risks and uncertainties that may affect the Company's business. Additional information regarding these and other factors can be found in ARRIS' reports filed with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2012. In providing forward-looking statements, the Company expressly disclaims any obligation to update publicly or otherwise these statements, whether as a result of new information, future events or otherwise.
SOURCE ARRIS Group, Inc.
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