Dropbox, Inc. Announces $1.135 Billion Convertible Notes Offering
22 Febrero 2021 - 3:05PM
Business Wire
Dropbox, Inc. (“Dropbox”) (NASDAQ: DBX) today announced its
intention to offer, subject to market conditions and other factors,
$567.5 million aggregate principal amount of convertible senior
notes due March 1, 2026 (the “2026 Notes”) and $567.5 million
aggregate principal amount of convertible senior notes due March 1,
2028 (the “2028 Notes” and, together with the 2026 Notes, the
“Notes”) in a private placement to qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933, as amended
(the “Act”). Dropbox also expects to grant the initial purchasers
of the Notes a 13-day option to purchase up to an additional $56.75
million aggregate principal amount of 2026 Notes and up to an
additional $56.75 million aggregate principal amount of 2028
Notes.
The Notes will be senior, unsecured obligations of Dropbox, and
interest will be payable semi-annually in arrears. For each series
of Notes, upon conversion, Dropbox will pay cash up to the
aggregate principal amount of Notes to be converted and pay or
deliver, as the case may be, cash, shares of Dropbox’s Class A
common stock (“Class A common stock”) or a combination of cash and
shares of Dropbox’s Class A common stock, at Dropbox’s election, in
respect of the remainder. The interest rate, conversion rate, and
other terms of the Notes are to be determined upon pricing of the
offering.
In connection with the pricing of the Notes, Dropbox intends to
enter into convertible note hedge and warrant transactions with one
or more of the initial purchasers or their affiliates and/or other
financial institutions (the “option counterparties”). The
convertible note hedge transactions are expected generally to
reduce the potential dilution to Dropbox’s Class A common stock
upon any conversion of the Notes and/or offset any cash payments
Dropbox is required to make in excess of the principal amount of
converted Notes, as the case may be. The warrant transactions would
separately have a dilutive effect to the extent that the market
value per share of the Class A common stock exceeds the strike
price of any of the warrants unless, subject to the terms of the
warrant transactions, Dropbox elects to cash settle the warrants.
If the initial purchasers exercise their option to purchase
additional notes, Dropbox intends to enter into additional
convertible note hedge and additional warrant transactions relating
to the additional notes.
In connection with establishing their initial hedge of the
convertible note hedge and warrant transactions, the option
counterparties or their respective affiliates expect to 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. This
activity 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 option 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 by purchasing or selling shares of the Class A common
stock or other securities of Dropbox 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 the Notes or in
connection with any repurchase of Notes by Dropbox 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 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, it could affect the amount and value of
the consideration that noteholders will receive upon conversion of
such Notes.
Dropbox intends to use a portion of the net proceeds of the
offering of the Notes to pay the cost of the convertible note hedge
transactions described above (after such cost is partially offset
by the proceeds to Dropbox from the warrant transactions) and to
repurchase shares of its Class A common stock from institutional
investors. Dropbox expects to use the remaining proceeds of the
offering for general corporate purposes, including repurchases of
its Class A common stock.
This announcement is neither an offer to sell nor a solicitation
of an offer to buy any of these securities and shall not constitute
an offer, solicitation, or sale in any jurisdiction in which such
offer, solicitation, or sale is unlawful. The convertible note
hedge transactions, warrant transactions, 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 unless so
registered, may not be offered or sold in the United States except
pursuant to an applicable exemption from the registration
requirements of the Act and applicable state laws.
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version on businesswire.com: https://www.businesswire.com/news/home/20210222005879/en/
Media Contact: Tessa Chen press@dropbox.com or
Investor Relations Contact: Rob Bradley IR@dropbox.com
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