On February 17, 2021, The GEO Group, Inc. (“GEO” or the “Company”) announced that GEO Corrections Holdings, Inc. (“GEOCH”), a wholly-owned subsidiary of the Company, intends, subject to market and other customary conditions, to offer $200,000,000 aggregate principal amount of exchangeable senior notes due 2026 (the “Notes”) in a private offering. GEOCH also expects to grant the initial purchasers of the Notes a 13-day option to purchase up to an additional $30,000,000 aggregate principal amount of the Notes solely to cover over-allotments, if any. The Notes will be guaranteed by GEO and GEO’s subsidiaries that are guarantors under GEO’s senior credit facility and outstanding senior notes. The offering is expected to result in net proceeds of approximately $192.0 million (or approximately $221.1 million if the initial purchasers exercise in full their over-allotment option), after deducting the initial purchasers’ discount and estimated offering expenses payable by GEO or GEOCH.
On February 19, 2021, GEO announced the pricing of GEOCH’s offering of Notes. The notes will mature on February 23, 2026, unless earlier repurchased or exchanged. GEOCH will pay to the noteholders cash interest at an annual rate of 6.50% plus an additional amount based on the dividends paid by the Company on its common stock, $0.01 par value per share (the “Company’s common stock”). Interest will be payable semiannually in arrears on March 1 and September 1 of each year, beginning on September 1, 2021.
The exchange rate for the Notes is initially 108.4011 shares per $1,000 principal amount of the Notes (equivalent to an initial exchange price of approximately $9.225 per share of the Company’s common stock). The exchange rate will be subject to certain adjustments. GEOCH expects to issue the Notes on February 24, 2021.