NEW YORK, Feb. 27, 2012 /PRNewswire/ -- DealerTrack
Holdings, Inc. (Nasdaq: TRAK) ("DealerTrack") announced that it
intends to offer, subject to market and other conditions,
$150 million aggregate principal
amount of senior convertible notes due 2017 (the "Notes") in a
private offering. The Notes will be offered only to qualified
institutional buyers in reliance on Rule 144A under the Securities
Act of 1933, as amended (the "Securities Act"). DealerTrack also
expects to grant the initial purchasers of the Notes an option to
purchase, within a 13 day period beginning on, and including, the
date it first issues the Notes, up to an additional $22.5 million aggregate principal amount of
Notes.
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The Notes will pay interest semi-annually and will mature on
March 15, 2017, unless earlier
repurchased or converted. Prior to October
15, 2016, the Notes will be convertible only upon the
occurrence of certain events and during certain periods, and
thereafter, at any time until the second scheduled trading day
immediately preceding the maturity date. Upon conversion, holders
will receive, at DealerTrack's discretion, cash, shares of
DealerTrack's common stock or a combination thereof. DealerTrack
will not have the right to redeem the Notes prior to maturity.
In connection with the offering of the Notes, DealerTrack
expects to enter into one or more privately negotiated convertible
note hedge transactions with one or more dealers, which may include
one or more of the initial purchasers of the Notes or their
respective affiliates (the "hedge counterparties"). The convertible
note hedge transactions are expected to cover, subject to customary
anti-dilution adjustments, the number of shares of DealerTrack
common stock that will initially underlie the Notes. DealerTrack
also expects to enter into separate privately negotiated warrant
transactions with the hedge counterparties.
In connection with establishing their initial hedges of the
convertible note hedge transactions and warrant transactions, the
hedge counterparties and/or their affiliates expect to purchase
DealerTrack common stock in open market transactions and/or
privately negotiated transactions and/or enter into various
cash-settled derivative transactions with respect to DealerTrack
common stock concurrently with, or shortly after, the pricing of
the Notes. In addition, the hedge counterparties and/or their
affiliates may modify their hedge positions by entering into or
unwinding various derivative transactions with respect to
DealerTrack common stock and/or by purchasing or selling
DealerTrack common stock in open market transactions and/or
privately negotiated transactions following the pricing of the
Notes from time to time (and are likely to do so during any
conversion period related to a conversion of Notes). Any of these
hedging activities could also increase, decrease or prevent a
decline in, the market price of DealerTrack common stock.
DealerTrack expects to use a portion of the net proceeds from
the offering of the Notes and the proceeds from the sale of the
warrants to fund the cost of the convertible note hedge
transactions. The remaining net proceeds from the offering of the
Notes are expected to be used for working capital and general
corporate purposes, which may include, among other things,
repayment of existing indebtedness, acquisitions and
investments.
The Notes and the shares of DealerTrack common stock issuable
upon conversion of the Notes, if any, have not been and will not be
registered under the Securities Act or applicable state securities
laws and, unless so registered, may not be offered or sold in
the United States except pursuant
to an applicable exemption from the registration requirements of
the Securities Act and applicable state securities laws.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy these securities, nor shall there
be any sale of, the Notes or the shares of DealerTrack common stock
issuable upon conversion of the Notes, if any, in any state in
which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
state.
Safe Harbor for Forward-Looking and Cautionary Statements
Statements in this press release regarding DealerTrack's
intention to offer its Notes, the proposed terms of such Notes, and
the expected use of the proceeds of the sale of such Notes,
including DealerTrack's expectation that it will enter into certain
warrant and hedging transactions, and all other statements in this
release other than the recitation of historical facts are
forward-looking statements (as defined in the Private Securities
Litigation Reform Act of 1995). Forward looking statements may be
identified by the words "believe," "expect," "anticipate,"
"project," "plan," "estimate," "will" or "intend" and similar
expressions. The forward-looking statements contained herein
reflect DealerTrack's current views with respect to future events
and are based on DealerTrack's currently available data and on
current business plans. These statements involve a number of risks,
uncertainties and other factors that could cause actual results,
performance or achievements of DealerTrack to be materially
different from any future results, performance or achievements
expressed or implied by these forward-looking statements.
Factors that might cause such a difference include, but are not
limited to: economic factors such as changes in interest rates,
political instability, or currency exchange rate fluctuations;
regulatory factors such as unfavorable changes in governmental
regulations; and other risks listed in DealerTrack's reports filed
with the Securities and Exchange Commission (the "SEC"), including,
without limitation, DealerTrack's Annual Report on Form 10-K for
the year ending December 31, 2011.
These filings can be found on DealerTrack's website at
www.dealertrack.com and the SEC's website at www.sec.gov.
Forward-looking statements included herein speak only as of the
date hereof and DealerTrack disclaims any obligation to revise or
update such statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events or
circumstances, except as required by law.
TRAK-E
SOURCE DealerTrack Holdings, Inc.