Mindbody Announces Pricing Of Upsized $270 Million Convertible Senior Notes Offering

In connection with the pricing of the notes, MINDBODY entered into capped call transactions with one of the initial purchasers and other financial institutions (the “option counterparties”). The capped call transactions are expected generally to reduce potential dilution to MINDBODY’s Class A common stock upon any conversion of notes and/or offset any cash payments MINDBODY 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 initially equal to $76.20 per share (which represents a premium of 100% over the last reported sale price of MINDBODY’s Class A common stock on the Nasdaq Global Market on June 7, 2018).

In connection with establishing their initial hedges of the capped call transactions, the option counterparties or their respective affiliates expect to purchase shares of MINDBODY’s Class A common stock and/or enter into various derivative transactions with respect to MINDBODY’s 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 MINDBODY’s Class A common stock or the notes at that time. 

In addition, MINDBODY expects that the option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to MINDBODY’s Class A common stock and/or purchasing or selling MINDBODY’s Class A common stock or other securities of MINDBODY 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). This activity could also cause or avoid an increase or a decrease in the market price of MINDBODY’s Class A common stock or the notes, which could affect a noteholder’s ability to convert its notes and, to the extent the activity occurs during any observation period related to a conversion of notes, it could affect the number of shares and value of the consideration that a noteholder will receive upon conversion of its notes.

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Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and ...

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