PROS Holdings, Inc. Announces Pricing of Private Offering of $150 Million of Convertible Senior Notes due 2027
September 11 2020 - 7:30AM
Business Wire
PROS Holdings, Inc. (NYSE: PRO) (the “Company”) today announced
the pricing of its previously announced private offering of $150.0
million aggregate principal amount of convertible senior notes due
2027 (the “Convertible Notes”). The Convertible Notes are being
offered in a private placement to qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933, as amended
(the “Securities Act”).
The Convertible Notes will be unsecured, unsubordinated
obligations of the Company and will pay interest semiannually at an
annual rate of 2.250% and will be convertible into cash, shares of
the Company’s common stock or a combination of cash and shares of
the Company’s common stock, at the Company’s election, based on the
applicable conversion rate at such time. The Convertible Notes have
an initial conversion rate of 23.9137 shares of the Company’s
common stock per $1,000 principal amount of Convertible Notes
(which is equivalent to an initial conversion price of
approximately $41.82 per share of the Company’s common stock),
representing an initial conversion premium of approximately 32.5%
above the closing price of $31.56 per share of the Company’s common
stock on September 10, 2020. The conversion rate is subject to
adjustment in certain circumstances, including in connection with
specified fundamental changes. Holders of the Convertible Notes
will have the right to require the Company to repurchase all or a
portion of their notes upon the occurrence of a fundamental change
(as defined in the indenture governing the Convertible Notes) at a
purchase price of 100% of their principal amount plus any accrued
and unpaid interest. The Convertible Notes will mature on September
15, 2027, unless converted, redeemed or repurchased in accordance
with their terms prior to such date. Prior to June 15, 2027, the
Convertible Notes will be convertible only upon the satisfaction of
certain conditions and during certain periods, and thereafter, at
any time prior to the close of business on the second scheduled
trading day immediately preceding the maturity date regardless of
these conditions. The Company expects to close the offering on or
about September 15, 2020, subject to the satisfaction of various
customary closing conditions.
In connection with the offering, the Company entered into
privately negotiated capped call transactions with certain option
counterparties. The capped call transactions cover, subject to
anti-dilution adjustments, the number of shares of common stock
underlying the Convertible Notes sold in the offering. The capped
call transactions are generally expected to reduce potential
dilution to the Company’s common stock upon conversion of the
Convertible Notes and/or offset any cash payments the Company is
required to make in excess of the principal amount of converted
notes, as the case may be.
The Company estimates that it will receive net proceeds from the
offering of approximately $145.9 million, after deducting the
initial purchasers’ discount and estimated offering expenses. The
Company intends to use $25.3 million of the net proceeds of the
offering to pay the cost of the capped call transactions. The
Company intends to use the remainder of the net proceeds from the
offering for general corporate purposes, including working capital,
capital expenditures, potential acquisitions and strategic
transactions.
This press release is neither an offer to sell nor a
solicitation of an offer to buy the Convertible Notes or the shares
of common stock issuable upon conversion of the Convertible Notes,
if any, nor shall there be any sale of these securities in any
state or jurisdiction in which such an offer, solicitation or sale
would be unlawful prior to the registration or qualification under
the securities laws of any such state or jurisdiction.
The Convertible Notes and the shares of common stock issuable
upon conversion of the Convertible Notes, if any, have not been
registered under the Securities Act, or the securities laws of any
other jurisdiction, and may not be offered or sold in the United
States absent registration or an applicable exemption from
registration requirements.
Forward-looking Statements
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of 1995
regarding the planned offering, business strategies, market
potential, future financial and operational performance and other
matters. Words such as “anticipates,” “estimates,” “expects,”
“projects,” “forecasts,” “intends,” “plans,” “will,” “believes” and
words and terms of similar substance used in connection with any
discussion of future operating or financial performance identify
forward-looking statements. These forward-looking statements are
based on management’s current expectations and beliefs about future
events and are inherently susceptible to uncertainty and changes in
circumstances. Except as required by law, the Company is under no
obligation to, and expressly disclaim any obligation to, update or
alter any forward-looking statements whether as a result of such
changes, new information, subsequent events or otherwise. With
respect to the planned offering, such uncertainties and
circumstances include whether the Company will consummate the
offering on the anticipated terms of the notes, if at all, and the
use of the net proceeds from the offering; and whether the capped
call transactions will become effective. Various factors could also
adversely affect the Company’s operations, business or financial
results in the future and cause the Company’s actual results to
differ materially from those contained in the forward-looking
statements, including those factors discussed in detail in the
“Risk Factors” sections contained in the Company’s Annual Report on
Form 10-K for the year ended December 31, 2019 (the “Annual
Report”) and Quarterly Reports on Form 10-Q for the three month
period ended March 31, 2020 and the three and six month periods
ended June 30, 2020 (the “Quarterly Reports”), filed with the
Securities and Exchange Commission. In addition, the Company
operates in a highly competitive, rapidly changing and
technology-driven industry. This industry is affected by government
regulation, economic, strategic, political and social conditions,
technological developments and, particularly in view of new
technologies, the continued ability to protect intellectual
property rights. The Company’s actual results could differ
materially from management’s expectations because of changes in
such factors. Achieving the Company’s business and financial
objectives, including improved financial results and maintenance of
a strong balance sheet and liquidity position, could be adversely
affected by the factors discussed or referenced under the “Risk
Factors” sections contained in the Annual Report and Quarterly
Reports as well as, among other things: (1) changes in the
Company’s plans, strategies and initiatives; (2) the impacts of the
global COVID-19 pandemic on the Company’s business, customers,
partners, employees, markets, financial results and condition; (3)
stock price volatility; (4) future borrowing and restrictive
covenants under the revolving credit facility; (5) the impact of
acquisitions, dispositions and other similar transactions; (6) the
Company’s ability to attract and retain key employees; and (7) the
Company’s ability to attract and retain new and existing customers
to its solutions.
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version on businesswire.com: https://www.businesswire.com/news/home/20200911005202/en/
Investor Contact: PROS Investor Relations Shannon Tatz
713-335-5932 ir@pros.com
Media Contact: Amanda Parrish 832-924-4731
aparrish@pros.com
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