Pluralsight, Inc. Announces $450 Million Convertible Notes Offering
March 04 2019 - 4:46PM
Pluralsight, Inc. (NASDAQ: PS) today announced its intention to
offer, subject to market conditions and other factors, $450 million
aggregate principal amount of convertible senior notes due 2024
(the “notes”) in a private placement to qualified institutional
buyers pursuant to Rule 144A under the Securities Act of 1933, as
amended (the “Act”). Pluralsight also expects to grant the
initial purchasers of the notes a 13-day option to purchase up to
an additional $67.5 million aggregate principal amount of the
notes.
The notes will be senior unsecured obligations of Pluralsight,
and interest will be payable semi-annually in arrears. The
notes will be convertible into cash, shares of Pluralsight’s Class
A common stock (“Class A common stock”), or a combination thereof,
at Pluralsight’s election. The interest rate, initial
conversion rate and other terms of the notes are to be determined
upon pricing of the offering.
Pluralsight expects to use a portion of the net proceeds of the
offering of the notes to pay the cost of the capped call
transactions described below. Pluralsight intends to provide
the remainder of the net proceeds from the offering of the notes to
Pluralsight Holdings, LLC or its subsidiaries to be used for
working capital and other general corporate purposes, as well as
the acquisition of, or investment in, complementary products,
technologies, solutions, or businesses, although Pluralsight has no
present commitments or agreements to enter into any acquisitions or
investments as of the date of this press release.
In connection with the pricing of the notes, Pluralsight 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 “counterparties”). The capped
call transactions are expected to offset the potential dilution to
the Class A common stock upon any conversion of notes and/or offset
any cash payments Pluralsight is required to make in excess of the
principal amount of converted notes, as the case may be, with such
offset subject to a cap. If the initial purchasers exercise
their option to purchase additional notes, Pluralsight expects to
use a portion of the proceeds from the sale of the additional notes
to enter into additional capped call transactions with the
counterparties.
Pluralsight expects that, in connection with establishing their
initial hedge of the capped call transactions, the counterparties
or their respective affiliates will purchase shares of the Class A
common stock and/or enter into various derivative transactions with
respect to the Class A common stock concurrently with, or shortly
after, the pricing of the notes, including with certain investors
in the notes. These activities could increase (or reduce the
size of any decrease in) the market price of the Class A common
stock or the notes at that time. In addition, the
counterparties or their respective affiliates may modify their
hedge positions by entering into or unwinding various derivatives
with respect to the Class A common stock and/or purchasing or
selling shares of the Class A common stock or other securities of
Pluralsight 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 relating to a conversion of
the notes). This activity could also cause or prevent an
increase or a decrease in the market price of the Class A common
stock or the notes, which could affect the ability of noteholders
to convert the notes and, to the extent the activity occurs during
any observation period related to a conversion of the notes, could
affect the number of shares of Class A common stock and value of
the consideration that noteholders will receive upon conversion of
the notes.
Concurrently with the offering of notes, certain selling
stockholders of Pluralsight are offering approximately 13,558,464
shares of Pluralsight’s Class A common stock in an underwritten
public offering. Certain selling stockholders also intend to
grant the underwriters a 30-day option to purchase up to an
additional 2,033,770 shares of Pluralsight’s Class A common stock.
The offering of notes is not contingent upon the concurrent public
offering of Class A common stock, and the concurrent public
offering of Class A common stock is not contingent upon the
offering of notes.
This announcement is neither an offer to sell nor a solicitation
of an offer to buy any securities and shall not constitute an
offer, solicitation or sale in any jurisdiction in which such
offer, solicitation or sale is unlawful. The notes will be
offered to qualified institutional buyers pursuant to Rule 144A
under the Act. The notes and the shares of Class A common
stock issuable upon conversion of the notes, if any, have not been,
and will not be, registered under the Act or the securities laws of
any other jurisdiction and may not be offered or sold in the United
States without registration or an applicable exemption from
registration requirements.
Forward-Looking Statements
This press release includes forward-looking statements within
the meaning of Section 27A of the Act and Section 21E of the
Securities Exchange Act of 1934. These statements involve risks and
uncertainties that could cause actual results to differ materially,
including, but not limited to, whether Pluralsight will be able to
consummate the offering of notes and Class A common stock, the
final terms of such offerings and the capped call transactions, the
satisfaction of customary closing conditions with respect to the
offerings, prevailing market conditions, the anticipated use of net
proceeds of the note offering which could change as a result of
market conditions or for other reasons, whether the capped call
transactions will become effective and the impact of general
economic, industry or political conditions in the United States or
internationally. Forward-looking statements may be identified by
the use of the words “may,” “will,” “expect,” “intend” and other
similar expressions. These forward-looking statements are based on
estimates and assumptions by Pluralsight’s management that,
although believed to be reasonable, are inherently uncertain and
subject to a number of risks. Actual results may differ materially
from those anticipated or predicted by Pluralsight’s
forward-looking statements. All forward-looking statements are
subject to other risks detailed in Pluralsight’s Annual Report on
Form 10-K for the year ended December 31, 2018 and the risks
discussed in Pluralsight’s other filings with the Securities and
Exchange Commission. You are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the
date hereof. All forward-looking statements are qualified in their
entirety by this cautionary statement, and Pluralsight undertakes
no obligation to revise or update this press release to reflect
events or circumstances after the date hereof, except as required
by applicable law.
Investor Contact:Mark McReynoldsInvestor
RelationsPluralsight(801) 784-9007ir@pluralsight.com
Media Contact:DJ
AndersonCommunications/PressPluralsight(801) 784-9007dj@pluralsight.com
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