Twitter Inc. on June 11 issued $1.15 billion of 0.25% convertible senior notes due 2024 in a private placement to institutional buyers.
In connection with the pricing of the notes on June 6, and the exercise of the initial purchasers' option on June 7, the company entered into privately negotiated convertible note hedge transactions with respect to its common stock with JPMorgan Chase Bank NA, Wells Fargo Bank NA and Barclays Bank PLC, the company said in a Form 8-K filed June 11.
The company will pay about $268 million to those counterparties for the convertible note hedge transactions, which cover, subject to anti-dilution adjustments substantially similar to those in the notes, about 20.1 million shares of the company's common stock. The convertible note hedge transactions will expire upon the maturity of the notes.
Separately, the company entered into privately negotiated warrant transactions, whereby the company will sell to the counterparties warrants to acquire, collectively, subject to anti-dilution adjustments, about 20.1 million shares of the company's common stock at an initial strike price of $80.20 per share, which represents a premium of 100% over the last reported sale price of the company's common stock of $40.10 on June 6.
The company will receive proceeds of about $186.8 million from the sale of the warrants to the counterparties.
