Bloomin’ Brands, Inc. (Nasdaq: BLMN) today announced its
intention to offer, subject to market and other conditions, $200
million aggregate principal amount of convertible senior notes due
2025 (the “notes”) in a private offering only to qualified
institutional buyers pursuant to Rule 144A under the Securities Act
of 1933, as amended (the “Securities Act”). Bloomin’ Brands also
intends to grant the initial purchasers of the notes an option to
purchase, for settlement within a period of 13 days from, and
including, the date notes are first issued, up to an additional $30
million aggregate principal amount of notes in the private
placement.
The notes will be senior, unsecured obligations of Bloomin’
Brands, will accrue interest payable semi-annually in arrears and
will mature on May 1, 2025, unless earlier repurchased, redeemed or
converted. Noteholders will have the right to convert their notes
in certain circumstances and during specified periods. Bloomin’
Brands will settle conversions by paying or delivering, as
applicable, cash, shares of its common stock or a combination of
cash and shares of its common stock, at Bloomin’ Brands’ election.
The notes will also be redeemable, in whole or in part, for cash at
Bloomin’ Brands’ option at any time, and from time to time, on or
after May 1, 2023 in certain circumstances. The redemption price
will be equal to the principal amount of the notes to be redeemed,
plus accrued and unpaid interest, if any, to, but excluding, the
redemption date. The interest rate, initial conversion rate and
other terms of the notes will be determined at the pricing of the
offering.
In connection with the offering of the notes, Bloomin’ Brands
expects to enter into privately negotiated convertible note hedge
transactions with one or more of the initial purchasers and/or
their respective affiliates and/or one or more financial
institutions (the “option counterparties”). These transactions will
cover, subject to customary anti-dilution adjustments, the number
of shares of Bloomin’ Brands’ common stock that will initially
underlie the notes, and are expected generally to reduce the
potential equity dilution, and/or offset any cash payments in
excess of the principal amount due, as the case may be, upon
conversion of the notes.
Bloomin’ Brands also expects to enter into separate,
privately-negotiated warrant transactions with the option
counterparties at a higher strike price relating to the same number
of shares of Bloomin’ Brands’ common stock, subject to customary
anti-dilution adjustments, pursuant to which Bloomin’ Brands will
sell warrants to the option counterparties. The warrants could have
a dilutive effect on Bloomin’ Brands’ common stock to the extent
that the price of Bloomin’ Brands’ common stock exceeds the strike
price of those warrants.
If the initial purchasers exercise their option to purchase
additional notes, Bloomin’ Brands expects to enter into additional
convertible note hedge transactions and additional warrant
transactions with the option counterparties, which will initially
cover the number of shares of Bloomin’ Brands’ common stock that
will initially underlie the additional notes sold to the initial
purchasers.
Bloomin’ Brands has been advised that in connection with
establishing their initial hedges of the convertible note hedge and
warrant transactions, the option counterparties or their respective
affiliates expect to enter into various derivative transactions
with respect to Bloomin’ Brands’ 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 Bloomin’ Brands’ common stock or the notes at that time. The
option counterparties or their respective affiliates may modify
their hedge positions by entering into or unwinding various
derivatives with respect to Bloomin’ Brands’ common stock and/or
purchasing or selling Bloomin’ Brands’ common stock or other
securities of Bloomin’ Brands in secondary market transactions
following the pricing of the notes and prior to maturity of the
notes (and are likely to do so during any observation period
related to a conversion of the notes).
The potential effect, if any, of these transactions and
activities on the market price of Bloomin’ Brands’ common stock or
the notes will depend in part on market conditions and cannot be
ascertained at this time, but any of these activities could
adversely affect the value of Bloomin’ Brands’ common stock, which
could affect the ability to convert the notes, the value of the
notes and the amount of cash, if any, and the number of and value
of the shares of Bloomin’ Brands’ common stock, if any, holders
would receive upon conversion of the notes.
The offer and sale of the notes and any shares of Bloomin’
Brands’ common stock issuable upon conversion of the notes have not
been registered under the Securities Act or any other applicable
securities laws. As a result, the notes and the shares of Bloomin’
Brands’ common stock, if any, issuable upon conversion of the
notes, will be subject to restrictions on transferability and
resale and may not be offered, transferred or sold, except in
compliance with the registration requirements of the Securities Act
or pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act and any
other applicable securities laws.
This press release does not and will not constitute an offer to
sell, or the solicitation of an offer to buy, the notes, any shares
of Bloomin’ Brands’ common stock issuable upon conversion of the
notes, or any other securities, nor will there be any sale of the
notes or any such shares or other securities, in any state or other
jurisdiction in which such offer, sale or solicitation would be
unlawful. Any offer will be made only by means of a private
offering memorandum.
About Bloomin’ Brands,
Inc.
Bloomin’ Brands, Inc. is one of the largest casual dining
restaurant companies in the world with a portfolio of leading,
differentiated restaurant concepts. Bloomin’ Brands has four
founder-inspired brands: Outback Steakhouse, Carrabba’s Italian
Grill, Bonefish Grill and Fleming’s Prime Steakhouse & Wine
Bar. Bloomin’ Brands operates more than 1,450 restaurants in 48
states, Puerto Rico, Guam and 20 countries, some of which are
franchise locations.
Forward-Looking
Statements
This press release includes forward-looking statements
concerning Bloomin’ Brands’ expectations, anticipations,
intentions, beliefs or strategies regarding the future, including
statements regarding the offering of the notes, the anticipated
terms of the notes being offered, the completion, timing and size
of the proposed offering, the intended use of the net proceeds and
the anticipated terms of, and the effects of entering into, the
convertible note hedge and warrant transactions. Generally, these
statements can be identified by the use of words such as
“believes,” “estimates,” “anticipates,” “expects,” “on track,”
“feels,” “forecasts,” “seeks,” “projects,” “intends,” “plans,”
“may,” “will,” “should,” “could,” “would” and similar expressions
intended to identify forward-looking statements, although not all
forward-looking statements contain these identifying words.
Forward-looking statements represent Bloomin’ Brands’ current
expectations regarding future events and are subject to known and
unknown risks and uncertainties that could cause actual results to
differ materially from those implied by the forward-looking
statements, and there can be no assurance that future developments
affecting Bloomin’ Brands will be those that it has anticipated.
These risks and uncertainties include, but are not limited to,
market conditions, including market interest rates and the trading
price and volatility of Bloomin’ Brands’ common stock, and risks
relating to Bloomin’ Brands’ business, including: the effects of
the COVID-19 pandemic and uncertainties about its depth and
duration, as well as the impacts to economic conditions and
consumer behavior, including, among others: the inability of
workers, including delivery drivers, to work due to illness,
quarantine, or government mandates, temporary restaurant closures
due to reduced workforces or government mandates, the unemployment
rate, the extent, availability and effectiveness of any COVID-19
stimulus packages or loan programs, the ability of our franchisees
to operate their restaurants during the pandemic and pay royalties,
trends in consumer behavior and spending during and after the end
of the pandemic, and the Company’s ability to manage expenses and
generate sufficient cash flow to fund operations; our ability to
achieve any cost savings targeted through our strategic review;
consumer reaction to public health and food safety issues;
competition; increases in labor costs; government actions and
policies; increases in unemployment rates and taxes; local,
regional, national and international economic conditions; consumer
confidence and spending patterns; price and availability of
commodities; the effects of changes in tax laws; challenges
associated with our remodeling, relocation and expansion plans;
interruption or breach of our systems or loss of consumer or
employee information; political, social and legal conditions in
international markets and their effects on foreign operations and
foreign currency exchange rates; our ability to preserve the value
of and grow our brands; the seasonality of the Bloomin’ Brands’
business; weather, acts of God and other disasters; changes in
patterns of consumer traffic, consumer tastes and dietary habits;
the cost and availability of credit; interest rate changes;
compliance with debt covenants and Bloomin’ Brands’ ability to make
debt payments and planned investments; and other risks described in
periodic reports that Bloomin’ Brands files from time to time with
the Securities and Exchange Commission (“SEC”). Bloomin’ Brands may
not consummate the proposed offering described in this press
release and, if the proposed offering is consummated, cannot
provide any assurances regarding the final terms of the offer or
the notes or its ability to effectively apply the net proceeds. For
additional information on these and other factors that could affect
Bloomin’ Brands’ actual results, see the risk factors set forth in
Bloomin’ Brands’ filings with the SEC, including the most recent
Annual Report on Form 10-K filed with the SEC on February 26, 2020
and the Current Report on Form 8-K filed with the SEC on May 5,
2020. Bloomin’ Brands disclaims and does not undertake any
obligation to update or revise any forward-looking statement in
this press release, except as required by applicable law or
regulation. Forward-looking statements included in this release are
made as of the date of this release.
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version on businesswire.com: https://www.businesswire.com/news/home/20200505005535/en/
Mark Graff Group Vice President, IR & Finance (813)
830-5311
Bloomin Brands (NASDAQ:BLMN)
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