Pandora Media, Inc. (NYSE:P) Files An 8-K Entry into a Material Definitive AgreementItem 1.01.
On May24, 2018, Pandora Media,Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with Morgan Stanley& Co. LLC (the “Underwriter”), relating to the offer and short sale by the Underwriter of 6,373,275 shares (the “Shares”) of the Company’s common stock, par value $0.0001 per share (the “Common Stock”) borrowed from third parties in connection with the exchange of approximately $192.9 million aggregate principal amount of the Company’s outstanding 1.75% senior convertible notes due 2020 (the “2020 Notes”) for an equal principal amount of a new series of 1.75% senior convertible notes due 2023 (the “New Notes”) to facilitate the establishment of short positions by certain exchanging holders to facilitate hedging of their investments in the New Notes.
The Shares were sold to an automatic registration statement on FormS-3 (the “Registration Statement”) filed with the Securities and Exchange Commission (the “SEC”) on May24, 2018, which became effective upon filing (File No.333-225175), and a related prospectus supplement (the “Prospectus Supplement”) filed with the SEC. The closing of the offering took place on May29, 2018.
The Underwriting Agreement is filed as Exhibit1.1 to this Current Report on Form8-K, and is incorporated by reference in the Registration Statement. The description of the Underwriting Agreement in this report is a summary and is qualified in its entirety by the terms of the Underwriting Agreement.
The Company is filing the opinion of its counsel, Sidley Austin LLP, as Exhibit 5.1 hereto, regarding the legality of the Shares covered by the Prospectus Supplement. Exhibit 5.1 is incorporated herein by reference and into the Registration Statement, and into the Prospectus Supplement.
On May24, 2018, the Company entered into separate privately negotiated exchange agreements with certain holders of its 2020 Notes to exchange in a private placement exempt from registration under Section4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), an aggregate of approximately $192.9million principal amount of 2020 Notes (the “Exchange”) for an equal principal amount of New Notes. The Company anticipates that settlement of the Exchange will occur on or about June1, 2018.
The New Notes will be senior unsecured obligations and pay interest semiannually in arrears at a rate of 1.75% per annum on June1 and December1 of each year, beginning on December1, 2018. Prior to the close of business on the business day immediately preceding July1, 2023, the New Notes will be convertible at the option of the holder into cash, shares of the Company’s Common Stock or a combination thereof, at the Company’s election, only upon satisfaction of certain conditions and during certain periods, and thereafter at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. The initial conversion rate for the New Notes has been set at 104.4768 shares of common stock per $1,000 principal amount of New Notes, which is equivalent to an initial conversion price of approximately $9.57 per share of common stock (subject to adjustment upon the occurrence of certain events). The New Notes will mature on December1, 2023, unless earlier converted, repurchased or redeemed.
In connection with the exchange, certain of the investors participating in the Exchange entered into transactions in respect of shares of the Common Stock in order to hedge their market risk with respect to the New Notes that they are to acquire in the Exchange, as described in Item 1.01 herein.
Following the closings of the Exchange, $152.1million in principal amount of the 2020 Notes will remain outstanding, and $192.9million aggregate principal amount of New Notes will be outstanding.
The issuance of the New Notes will occur under an indenture to be dated on or about June1, 2018, between the Company and Citibank, N.A., as trustee (the “Indenture”).
Press releases describing the above transactions are attached as Exhibits 99.1 and 99.2, respectively.
This Current Report on Form 8-K does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall it constitute an offer to sell, solicitation or sale in any jurisdiction in which such offer,
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solicitation or sale would be unlawful. The New Notes and any shares of Common Stock issuable upon conversion of the New Notes have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States or to U.S. persons except to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state laws.
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Pandora Media, Inc. ExhibitEX-1.1 2 d596192dex11.htm EX-1.1 EX-1.1 Exhibit 1.1 6,…To view the full exhibit click here
About Pandora Media, Inc. (NYSE:P)
Pandora Media, Inc. (Pandora) is a music discovery platform, offering a personalized experience for each of its listeners wherever and whenever they want to listen to music, whether through earbuds, car speakers or live on stage. The Company delivers targeted messages to its listeners using a combination of audio, display and video advertisements. The Company provides services, including Pandora and Ticketfly. It provides the Pandora service through over two models, such as free service and Pandora One. Its free service allows listeners access to its music and comedy catalogs and personalized playlist generating system for free across all of the Pandora delivery platforms. Pandora One is a paid subscription service without any advertising. In addition to its monthly subscriptions, service listeners can purchase a single day Pandora One experience with its Pandora One Day Pass product. The Company’s Ticketfly service is a cloud ticketing platform for live events.
