SAN MATEO, Calif., June 6, 2019 /PRNewswire/ -- Coupa Software
(NASDAQ: COUP) today announced that it has priced $700 million aggregate principal amount of
convertible senior notes due 2025 (the "notes"). The notes will be
sold to qualified institutional buyers pursuant to Rule 144A under
the Securities Act of 1933, as amended. Coupa also granted the
initial purchasers of the notes an option to purchase up to an
additional $105 million aggregate
principal amount of the notes if the initial purchasers sell more
than $700 million of the notes.
This sale is expected to close on June 11,
2019, subject to customary closing conditions.
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The notes will be senior, unsecured obligations of Coupa, and
interest will be payable semi-annually in cash at a rate of 0.125%
per annum on June 15 and December 15 of each year, beginning on
December 15, 2019. The notes will
mature on June 15, 2025 unless
redeemed, repurchased or converted prior to such date. Prior to
March 15, 2025, the notes will be
convertible at the option of holders during certain periods, upon
satisfaction of certain conditions. Thereafter, the notes will be
convertible at any time until the close of business on the second
scheduled trading day immediately preceding the maturity date. Upon
conversion, the notes may be settled in shares of Coupa common
stock, cash or a combination of cash and shares of Coupa common
stock, at Coupa's election.
The notes will have an initial conversion rate of 6.2658 shares
of common stock per $1,000 principal
amount of notes (subject to customary adjustments in certain
circumstances). This represents an initial effective
conversion price of approximately $159.60 per share. The initial conversion
price of the notes represents a premium of approximately 35% to the
$118.22 per share closing price of
Coupa common stock on June 6,
2019.
Coupa estimates that the net proceeds from the offering will be
approximately $683.6 million (or
approximately $786.2 million if the
initial purchasers exercise in full their option to purchase
additional notes) after deducting the initial purchasers' discount
and estimated offering expenses payable by Coupa. Coupa expects to
use the net proceeds from the offering of the notes for general
corporate purposes, potential acquisitions and strategic
transactions, and to pay the cost of the capped call transactions
described below. Coupa has no agreements or understandings
with respect to any material acquisitions or strategic transactions
at this time.
If the initial purchasers exercise their option to purchase
additional notes, Coupa intends to use a portion of the net
proceeds from the sale of the additional notes to enter into
additional capped call transactions with the capped call
counterparties and for general corporate purposes.
Coupa may redeem all or any portion of the notes, at its option,
on or after June 20, 2022, at a
redemption price equal to 100% of the principal amount of the notes
to be redeemed, plus accrued and unpaid interest thereon, if the
last reported sale price of Coupa's common stock has been at least
130% of the conversion price then in effect for at least 20 trading
days (whether or not consecutive) during any 30 consecutive trading
day period (including the last trading day of such period) ending
on, and including, the trading day immediately preceding the date
on which Coupa provides written notice of redemption.
Holders of notes may require Coupa to repurchase their notes
upon the occurrence of certain events that constitute a fundamental
change under the indenture governing the notes at a purchase price
equal to 100% of the principal amount thereof, plus accrued and
unpaid interest to, but excluding, the date of repurchase. In
connection with certain corporate events or if Coupa issues a
notice of redemption, it will, under certain circumstances,
increase the conversion rate for holders who elect to convert their
notes in connection with such corporate event or during the
relevant redemption period.
In connection with the pricing of the notes, Coupa has entered
into privately negotiated capped call transactions with one or more
of the initial purchasers of the notes and/or their respective
affiliates (the "capped call counterparties"). The capped call
transactions initially cover, subject to customary anti-dilution
adjustments, the number of shares of Coupa common stock that
initially underlie the notes, assuming the initial purchasers do
not exercise their option to purchase additional notes. The cap
price of the capped call transactions is initially $295.55 per share of Coupa's common stock,
representing a premium of 150% above the last reported sale price
of $118.22 per share of Coupa's
common stock on June 6, 2019, and is
subject to certain adjustments under the terms of the capped call
transactions. The capped call transactions are expected generally
to reduce or offset potential dilution to holders of Coupa's common
stock upon conversion of the notes and/or offset the potential cash
payments that Coupa could be required to make in excess of the
principal amount of any converted notes upon conversion thereof,
with such reduction and/or offset subject to a cap based on the cap
price. If the initial purchasers of the notes exercise their option
to purchase additional notes, Coupa may enter into additional
capped call transactions with capped call counterparties that would
initially cover, subject to customary anti-dilution adjustments,
the number of shares of Coupa common stock that will initially
underlie the notes purchased by the initial purchasers pursuant to
their option to purchase additional notes.
In connection with establishing their initial hedge of the
capped call transactions, the capped call counterparties have
advised Coupa that they and/or their respective affiliates expect
to enter into various derivative transactions with respect to Coupa
common stock and/or purchase Coupa 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 Coupa common stock or the notes concurrently with, or shortly
after, the pricing of the notes.
In addition, the capped call counterparties and/or their
respective affiliates may modify their hedge positions by entering
into or unwinding various derivatives with respect to Coupa common
stock and/or purchasing or selling Coupa common stock in secondary
market transactions following the pricing of the notes and prior to
the maturity of the notes. This activity could decrease (or avoid
an increase) in the market price of Coupa common stock or the
notes, which could affect noteholders' ability to convert the notes
and, to the extent the activity occurs during any observation
period related to a conversion of notes, it could affect the amount
and value of the consideration that noteholders will receive upon
conversion of such notes.
This announcement is neither an offer to sell nor a solicitation
of an offer to buy any of these securities (including the shares of
Coupa common stock, if any, into which the notes are convertible)
and shall not constitute an offer, solicitation or sale in any
jurisdiction in which such offer, solicitation or sale is
unlawful.
The notes and any shares of common stock issuable upon
conversion of the notes have not been registered under the
Securities Act of 1933, as amended, or any state securities laws
and may not be offered or sold in the
United States absent registration or an applicable exemption
from such registration requirements.
Forward-Looking Statements
This press release contains forward-looking statements
including, among other things, statements relating to the expected
closing date of the offering and the intended use of the net
proceeds from the offering. These forward-looking statements are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These statements involve
risks and uncertainties that could cause actual results to differ
materially, including, but not limited to, whether or not Coupa
will consummate the offering, prevailing market conditions, the
anticipated use of the net proceeds of the offering, which could
change as a result of market conditions or for other reasons,
whether or not the capped call transactions will be entered into or
become effective, and the impact of general economic, industry or
political conditions in the United
States or internationally.
Coupa assumes no obligation to, and does not currently intend
to, update any such forward-looking statements after the date of
this release.
About Coupa Software
Coupa Software is a leading provider of business spend
management (BSM) solutions. We offer a comprehensive, cloud-based
BSM platform that has connected hundreds of organizations with more
than four million suppliers globally. Our platform provides greater
visibility into and control over how companies spend money. Using
our platform, businesses are able to achieve real, measurable value
and savings that drive their profitability.
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SOURCE Coupa Software