SAN MATEO, Calif.,
April 6, 2017 /PRNewswire/ -- GoPro, Inc. (NASDAQ: GPRO)
today announced that it has priced $175 million aggregate
principal amount of 3.50% Convertible Senior Notes due 2022 (the
"notes"). The size of the offering was increased from the
previously announced $150 million in
aggregate principal amount. The notes will be sold in a private
placement to qualified institutional buyers pursuant to Rule 144A
under the Securities Act of 1933, as amended (the "Act"). The sale
is expected to close on April 12,
2017, subject to customary closing conditions.
The notes will be senior, unsecured obligations of GoPro. The
notes will bear cash interest at an annual rate of 3.50%, payable
semiannually in arrears on April 15
and October 15 of each year,
beginning on October 15, 2017. The
notes will mature on April 15, 2022,
unless earlier repurchased or converted in accordance with the
terms of the notes.
The notes will have an initial conversion rate of 94.0071 shares
of common stock per $1,000 principal
amount of notes (which is subject to adjustment in certain
circumstances). This is equivalent to an initial conversion price
of approximately $10.64 per share.
The initial conversion price represents a premium of approximately
25% to the $8.51 per share closing
price of GoPro's Class A common stock (the "Class A common stock")
on The NASDAQ Global Select Market on April
6, 2017. Prior to January 15,
2022, the notes will be convertible at the option of holders
only upon satisfaction of certain conditions and during certain
periods, and thereafter, at any time until the close of business on
the second scheduled trading day immediately preceding the maturity
date. Upon conversion, the notes may be settled in shares of Class
A common stock, cash or a combination of cash and shares of Class A
common stock, at the election of GoPro.
Holders of the notes will have the right to require GoPro to
repurchase all or a portion of their notes at 100% of the principal
amount of the notes, plus accrued and unpaid interest, if any, upon
the occurrence of a fundamental change (as defined in the indenture
relating to the notes). GoPro will also be required to increase the
conversion rate for holders who convert their notes in connection
with certain fundamental changes occurring prior to the maturity
date.
GoPro estimates that the net proceeds from the offering will be
approximately $169.3 million, after
deducting the initial purchasers' discount and estimated offering
expenses payable by GoPro. GoPro expects to use approximately
$78.0 million of the net proceeds
from the offering to pay the prepayment amount of the prepaid
forward described below and to use the remaining net proceeds from
the offering for general corporate purposes.
In connection with the issuance of the notes, GoPro entered into
a privately negotiated prepaid forward stock purchase transaction
(the "prepaid forward") with an affiliate of an initial purchaser
in the offering (the "forward counterparty"), pursuant to which
GoPro will purchase approximately $78.0
million worth of the Class A common stock, for settlement on
or around April 15, 2022, subject to
any early settlement, in whole or in part, of each prepaid forward.
In the event that GoPro pays any cash dividends on the Class A
common stock, the forward counterparty will pay an equivalent
amount to GoPro. The prepaid forward is intended to facilitate
privately negotiated derivative transactions by which investors in
the notes will be able to hedge their investment in the notes.
In connection with establishing its initial hedge of the prepaid
forward, the forward counterparty (or its affiliate) expects to
enter into one or more derivative transactions with respect to the
Class A common stock with purchasers of the notes concurrently with
or after the pricing of the notes. The prepaid forward is intended
to reduce the dilution to our stockholders from the issuance of
shares of Class A common stock (if any) upon conversion of the
notes and to allow certain investors to establish short positions
that generally correspond to commercially reasonable initial hedges
of their investment in the notes. The notional size of the prepaid
forward will correspond to the notional size of the aggregate
initial hedge position of such investors. It is possible, however,
that investors may seek to execute larger initial hedge positions,
in which case such investors may offset such larger initial hedge
positions by purchasing the Class A common stock on the pricing
date. Facilitating investors' hedge positions by entering into the
prepaid forward, particularly if investors purchase the Class A
common stock on the pricing date, could increase (or reduce the
size of any decrease in) the market price of the Class A common
stock or the notes and effectively raise the initial conversion
price of the notes.
In addition, the forward counterparty (or its affiliate) may
modify its hedge position by entering into or unwinding one or more
derivative transactions with respect to the Class A common stock
and/or purchasing or selling the Class A common stock or other
GoPro securities in secondary market transactions at any time,
including following the pricing of the notes and immediately prior
to or shortly after April 15, 2022
(and are likely to unwind their derivative transactions and/or
purchase or sell the Class A common stock in connection with any
conversion or repurchase of the notes, in connection with the
purchase or sale of notes by certain investors and/or in the event
that sufficient borrow of the Class A common stock becomes
available). These activities could also cause or avoid an increase
or a decrease in the market price of the Class A common stock or
the notes.
This announcement is neither an offer to sell nor a solicitation
of an offer to buy any of these securities (including any shares of
the Class A common stock into which the notes are convertible) and
shall not constitute an offer, solicitation or sale in any
jurisdiction in which such offer, solicitation or sale is unlawful.
Any offers of the notes will be made only by means of a private
offering memorandum.
The notes and the shares of Class A common stock, if any,
issuable upon conversion of the notes have not been registered
under the Act, or any state securities laws and may not be offered
or sold in the United States
absent registration or an applicable exemption from such
registration requirements.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/gopro-prices-175-million-of-350-convertible-senior-notes-due-2022-300436475.html
SOURCE GoPro