Overview

• The company opened an exchange offer to cut more than $800 million of debt by swapping its $1.15 billion zero-coupon 2027 convertibles for up to $202.5 million of new 7% PIK convertibles due 2030 plus as many as 326 million shares.
• Participation stands at roughly 47% of the notes outstanding, while completion requires 85% acceptance and holders have until Oct. 28 to decide.
• The PIK structure allows interest to be paid in additional debt with an effective rate up to 9.5%, reducing near-term cash outlays but increasing long-term obligations.
• Shares hit an all-time low of $1.23 and were last down about 32% at $1.93 on Monday, extending a year-to-date decline of roughly 50%.
• The offer follows a quarter marked by falling revenue, a wider-than-expected loss, and suspended full-year guidance, while most covering analysts rate the stock sell or strong sell.