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Blackhawk Network Holdings to offer $425M of convertible notes

Blackhawk NetworkHoldings Inc. will offer $425 million aggregate principal amount ofconvertible senior notes due 2022 through a private placement.

The company expects to grant the initial purchasers an optionto purchase up to an additional $35 million principal amount of notes, solely tocover any overallotments. The notes will be convertible into cash, common sharesof the company, or a combination thereof, at the company's election.

In connection with the offering, the company expects to enterinto convertible note hedge transactions with one or more of the initial purchasersof the notes or their affiliates or other financial institutions. The company alsoexpects to enter into warrant transactions with the option counterparties. If theinitial purchasers exercise their overallotment option, the company expects to enterinto additional convertible note hedge transactions and additional warrant transactionswith the option counterparties.

The company expects to use the net proceeds from the sale ofthe notes to repay borrowings under its credit facility, to repurchase common sharesfrom certain purchasers of the notes, to pay the net cost of the convertible notehedge transactions, to pay related transaction fees and expenses, and for generalcorporate purposes, including future acquisitions. The company expects to use upto $35 million of the net proceeds to repurchase common shares from purchasers ofnotes in the offering.