SAN MATEO, Calif., Nov. 18, 2020 /PRNewswire/ -- GoPro, Inc.
(NASDAQ: GPRO) ("GoPro") today announced that it proposes to
offer $100.0 million aggregate
principal amount of convertible senior notes due 2025 (the
"notes"), subject to market conditions and other factors. The notes
are to be offered and sold in a private placement to qualified
institutional buyers pursuant to Rule 144A under the Securities Act
of 1933, as amended (the "Act"). GoPro also intends to grant the
initial purchasers of the notes an option to purchase, within a
13-day period from, and including the date on which the notes are
first issued, up to an additional $15.0
million aggregate principal amount of notes.
The notes will be senior, unsecured obligations of GoPro, and
interest will be payable semiannually in arrears.
The notes will mature on November 15,
2025, unless earlier converted, redeemed or repurchased in
accordance with the terms of the notes. Prior to 5:00 p.m., New York
City time, on the business day immediately preceding
August 15, 2025, 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 5:00 p.m.,
New York City time, on the second
scheduled trading day immediately preceding the maturity date. Upon
conversion, the notes may be settled in shares of GoPro's Class A
common stock (the "common stock"), cash or a combination of cash
and shares of common stock, at the election of GoPro.
Holders of the notes will have the right to require GoPro to
repurchase for cash all or a portion of their notes at 100% of
their principal amount, plus any accrued and unpaid interest, 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 or a redemption notice, as the
case may be, prior to the maturity date. The notes will be
redeemable, in whole or in part, for cash at GoPro's option at any
time, and from time to time, on or after November 20, 2023, but only if the last reported
sale price per share of GoPro's common stock exceeds 130% of the
conversion price for a specified period of time.
The interest rate, conversion rate, offering price and other
terms are to be determined upon pricing of the notes.
GoPro intends to use a portion of the net proceeds to pay the
cost of the capped call transactions described below. GoPro intends
to use the remaining net proceeds for general corporate purposes,
which may include, among other things, repaying indebtedness and
expanding its current business through acquisitions of, or
investments in, other businesses, products or technologies.
However, GoPro has no commitments with respect to any such
acquisitions or investments at this time.
In connection with the pricing of the notes, GoPro expects to
enter into capped call transactions with one or more of the initial
purchasers or their respective affiliates and/or other financial
institutions (the "option counterparties"). The capped call
transactions are expected generally to reduce the potential
dilution to the common stock upon any conversion of the notes
and/or offset any cash payments GoPro is required to make in excess
of the principal amount of converted notes, as the case may be,
with such reduction and/or offset subject to a cap. If the initial
purchasers exercise their option to purchase additional notes,
GoPro expects to enter into additional capped call transactions
with the option counterparties.
In connection with establishing their initial hedges of the
capped call transactions, the option counterparties and/or their
respective affiliates expect to purchase shares of the common stock
and/or enter into various derivative transactions with respect to
the common stock concurrently with or shortly after the pricing of
the notes. This activity could increase (or reduce the size of any
decrease in) the market price of the common stock or the notes at
that time.
In addition, the option counterparties and/or their respective
affiliates may modify their hedge positions by entering into or
unwinding various derivatives with respect to the common stock
and/or purchasing or selling the common stock in secondary market
transactions following the pricing of the notes and prior to the
maturity of the notes (and are likely to do so during any
observation period related to a conversion of notes/may do so
following any repurchase of notes by GoPro on any fundamental
change repurchase date or otherwise). This activity could also
cause or avoid an increase or a decrease in the market price of the
common stock or the notes, which could affect the holder's ability
to convert the notes and, to the extent the activity occurs during
any observation period related to a conversion of the notes, it
could affect the number of shares and the value of the
consideration that the holder would receive upon conversion of the
notes.
If the initial purchasers exercise their option to purchase
additional notes, GoPro may use the resulting additional proceeds
of the sale of the additional notes to pay the cost of entering
into the additional capped call transactions and for general
corporate purposes, including potential acquisitions and strategic
transactions.
This announcement is neither an offer to sell nor a solicitation
of an offer to buy any of these securities (including the shares of
the common stock, if any, 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 any shares of the common stock 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.
Cautionary Statement Regarding Forward-Looking Statements
This press release may include forward-looking statements within
the meaning Section 27A of the Private Securities Litigation Reform
Act. Words such as "anticipate," "believe," "estimate," "expect,"
"intend," "should," "will" and variations of these terms or the
negative of these terms and similar expressions are intended to
identify these forward-looking statements. Forward-looking
statements in this press release may include but are not limited to
statements regarding GoPro's proposed offering of the notes and
expected use of net proceeds of the offering. Factors that may
contribute to such differences include, but are not limited to,
risks related to whether GoPro will consummate the offering of the
notes on the expected terms, or at all, the anticipated principal
amount of the notes, which could differ based upon market
conditions, whether the capped call transactions will become
effective, the expected use of the net proceeds from the offering,
which could change as a result of market conditions or for other
reasons, prevailing market and other general economic, industry or
political conditions in the United
States or internationally, the impact of COVID-19, and
whether GoPro will be able to satisfy the conditions required to
close any sale of the notes. The foregoing list of risks and
uncertainties is illustrative, but is not exhaustive. For
information about other potential factors that could affect GoPro's
business and financial results, please review the "Risk Factors"
described in GoPro's Annual Report on Form 10-K for the year ended
December 31, 2019 and GoPro's
Quarterly Report on Form 10-Q for the quarter ended September 30, 2020 filed with the Securities and
Exchange Commission (the "SEC") and in GoPro's other filings with
the SEC. These forward-looking statements speak only as of the date
hereof or as of the date otherwise stated herein. GoPro disclaims
any obligation to update these forward-looking statements.
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SOURCE GoPro, Inc.