GameStop (GME) has agreed to exchange about $1.4 billion of its outstanding 0% convertible senior notes due 2030 and 2032 for its class A common stock without the use of cash.
Noteholders are exchanging around $400 million of the 2030 notes and $1 billion of the 2032 notes, the company said.
The exchange is expected to close around Sept. 23. Following the closing, the exchanged notes will be canceled and no longer outstanding, reducing GameStop's debt by around $1.4 billion.
The number of shares to be issued will be determined partially based on the average volume-weighted average price of GameStop's stock over a 35 consecutive trading-day reference period beginning Aug. 3, the company said.
Shares of GameStop were down more than 7% in premarket activity Monday.
Price: $20.13, Change: $-1.59, Percent Change: -7.32%