PROS Holdings, Inc. (NYSE:PRO) Files An 8-K Entry into a Material Definitive Agreement

PROS Holdings, Inc. (NYSE:PRO) Files An 8-K Entry into a Material Definitive Agreement

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Item 1.01 Entry into a Material Definitive Agreement

On June 21, 2017, the Company issued $106,250,000 in aggregate
principal amount at maturity of the Convertible Notes under an
indenture, dated as of June 21, 2017 (the “Indenture”), between
the Company and Wilmington Trust, National Association, as trustee
(the “Trustee”), to certain qualified institutional buyers (the
“Purchasers”) as defined in Rule 144A under the Securities Act.
The Convertible Notes were issued to the Purchasers to an exemption
from the registration requirements of the Securities Act afforded
by Section 4(a)(2) of the Securities Act. The Convertible Notes and
the shares of common stock issuable upon conversion of the
Convertible Notes, if any, will not be registered under the
Securities Act, or the securities laws of any other jurisdiction,
and may not be offered or sold in the United States absent
registration or an applicable exemption from registration
requirements.
The Convertible Notes will mature on June 1, 2047, unless
repurchased, redeemed or converted in accordance with their terms
prior to such date. Each $1,000 principal amount at maturity of
Convertible Notes had an issue price of $880 for purposes of the
Indenture. An amount equal to the difference between the issue
price and the principal amount at maturity will accrete to the
Convertible Notes in accordance with the schedule set forth in the
Indenture. The issue price plus such accreted amount per $1,000
principal amount at maturity of the Convertible Notes is referred
to herein as the accreted principal amount. On June 1, 2022, the
accreted principal amount will accrete to 50% of the final
principal amount.
The Convertible Notes will bear interest at a rate of 2.00% per
year, payable semiannually in arrears in cash on June 1st and
December 1st of each year, beginning on December 1, 2017. The
Convertible Notes are general unsecured obligations of the Company
and will rank senior in right of payment to all of the Company’s
indebtedness that is expressly subordinated in right of payment to
the Convertible Notes, will rank equally in right of payment with
all of the Company’s existing and future liabilities that are not
so subordinated, will be effectively junior to any of the
Company’s secured indebtedness to the extent of the value of the
assets securing such indebtedness and will be structurally
subordinated to all indebtedness and other liabilities (including
trade payables but excluding intercompany obligations owed to the
Company or its subsidiaries.
Holders may convert their Convertible Notes at their option on any
day prior to the close of business on the business day immediately
preceding March 1, 2047 only under the following circumstances: (1)
during the five consecutive business day period immediately
following any five consecutive trading day period (the
“Measurement Period”) in which the trading price per Convertible
Note for each day of that Measurement Period was less than 98% of
the product of the last reported sale price of the Company’s
common stock and the conversion rate on each such day; (2) during
any calendar quarter commencing after the calendar quarter ending
September 30, 2017, if the last reported sale price of the
Company’s common stock for 20 or more trading days (whether or not
consecutive) in a period of 30 consecutive trading days ending on
the last trading day of the immediately preceding calendar quarter
exceeds 130% of the applicable conversion price in effect on each
such trading day; or (3) upon the occurrence of specified corporate
events. The Convertible Notes will be convertible, regardless of
the foregoing circumstances, at any time from, and including, March
1, 2047 until the close of business on the second scheduled trading
day immediately preceding the applicable maturity date.
Upon conversion the Company will pay cash or deliver, as the case
may be, cash, shares of the Company’s common stock or a
combination of cash and shares of the Company’s common stock, at
the Company’s election. If the Company satisfies the conversion
obligation solely in cash or through payment and delivery, as the
case may be, of a combination of cash and shares of common stock,
the amount of cash and shares of common stock, if any, due upon
conversion will be based on a daily conversion value calculated on
a proportionate basis for each trading day in a 40 trading day
observation period. The initial conversion rate for the Convertible
Notes will be 20.5624 shares of common stock per $1,000 in
principal amount at maturity of Convertible Notes, equivalent to a
conversion price of approximately $48.63 per share of common stock.
The conversion rate will be subject to adjustment in certain
circumstances.
Each holder of the Convertible Notes has the right to require the
Company to repurchase for cash all or any portion of such holder’s
Convertible Notes on June 1, 2022 at a price per $1,000 principal
amount at maturity of Convertible Notes equal to the accreted
principal amount plus accrued and unpaid interest to, but
excluding, the repurchase date.
Subject to certain exceptions, holders may require the Company to
repurchase, for cash, all or part of their Convertible Notes upon a
Fundamental Change (as defined in the Indenture) at a price equal
to 50% of the accreted principal amount of the Convertible Notes
being repurchased plus any accrued and unpaid interest up to, but
excluding, the Fundamental Change Repurchase Date (as defined in
the Indenture). Holders who convert their Convertible Notes in
connection with a Make-Whole Fundamental Change (as defined in the
Indenture) or in connection with a redemption of such Convertible
Notes on or prior to June 1, 2021 will, under certain
circumstances, be entitled to a make-whole premium in the form of
an increase in the conversion rate determined by reference to a
make-whole table set forth in the Indenture.
On or before June 1, 2021, and subject to the satisfaction of
certain conditions, the Company is entitled to elect to redeem all
or any portion of the Convertible Notes at a redemption price equal
to 50% of the accreted principal amount at maturity of Convertible
Notes, plus accrued and unpaid interest to, but excluding, the
redemption date, if the daily volume weighted average price of the
Companys common stock is greater than or equal to 130% of the
conversion price for at least 20 trading days during any 30
consecutive trading day period. After June 1, 2021, the Company
will be entitled to elect to redeem all or any portion of the
Convertible Notes (without regard to the price of the Companys
common stock) at a redemption price equal to 50% of the accreted
principal amount of Convertible Notes, plus accrued and unpaid
interest to, but excluding, the redemption date.
The Indenture contains certain events of default after which the
Convertible Notes may be due and payable immediately. Such events
of default include, without limitation, the following: failure to
pay interest on any Convertible Note when due and such failure
continues for 30 days; failure to pay any accreted principal amount
of any Convertible Note when due and payable at maturity, upon
required repurchase, upon acceleration or otherwise; failure to
comply with the Company’s obligation to convert the Convertible
Notes into cash, the Company’s common stock or a combination of
cash and common stock, as applicable, upon exercise of a holder’s
conversion right and such failure continues for 3 business days;
failure to comply with the Company’s obligations under the
Indenture with respect to consolidation with or merger with or into
or sale, transfer or lease of all or substantially all of the
Company’s properties and assets to another person; failure by the
Company to provide timely notice of a Fundamental Change,
Make-Whole Fundamental Change or certain specified corporate
transactions; failure to comply with any other agreements under the
Convertible Notes or Indenture (other than those described above in
this paragraph) and such failure or breach continues for 60 days
after written notice has been given to the Company by the holders
of at least 25% in aggregate principal amount at maturity of the
Convertible Notes then outstanding; default by the Company or one
of its Subsidiaries (as defined in the Indenture) with respect to
any mortgage, agreement or other instrument under which there may
be outstanding, or by which there may be secured or evidenced any
indebtedness for money borrowed in excess of $25.0 million; a final
judgment or judgments for the payment of $25.0 million or more
rendered against the Company or any of its Subsidiaries, which
judgment is not discharged or stayed within 60 days after the date
on which the right to appeal has expired if no such appeal has
commenced or the date on which all rights to appeal have been
extinguished; or certain events of bankruptcy, insolvency or
reorganization of the Company or one of its Subsidiaries.
The description of the Indenture and Convertible Notes contained
herein is qualified in its entirety by reference to the Indenture
(which includes a form of Convertible Note) attached as Exhibit 4.1
to this Current Report on Form 8-K and is incorporated herein by
reference.
Item 2.03
Creation of a Direct Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 is incorporated herein by
reference into this Item 2.03.
Item 3.02 Unregistered Sales of Equity Securities
As described in Item 1.01 of this Report, which is incorporated
herein by reference, on June 21, 2017, the Company issued
$106,250,000 in aggregate principal amount at maturity of
Convertible Notes to the Purchasers in separate private placements
to exemptions from the registration requirements of the Securities
Act. The Company
offered and sold the Convertible Notes in reliance on the exemption
from registration provided by Section 4(a)(2) of the Securities
Act. The Convertible Notes were sold to “qualified institutional
buyers”, as defined in Rule 144A under the Securities Act. The
Convertible Notes and common stock issuable upon conversion of the
Convertible Notes, if any, at the Company’s election, have not
been registered under the Securities Act and may not be offered or
sold in the United States absent registration or an applicable
exemption from registration requirements. The Convertible Notes are
convertible into cash, shares of the Company’s common stock, or a
combination thereof, as described in this Report and the Indenture.
The net proceeds from the Convertible Notes offering were
approximately $90.2 million, after deducting the original issue
discount and offering expenses. The Company intends to use the net
offering proceeds for general corporate purposes, including (but
not limited to) acquisitions or other strategic transactions,
working capital and capital expenditures, and debt repayment from
time to time, based on market conditions.
The description of the Indenture and Convertible Notes contained
herein is qualified in its entirety by reference to the Indenture
(which includes a form of Convertible Note) attached as Exhibit 4.1
to this Current Report on Form 8-K and is incorporated herein by
reference.
Item 9.01. Financial Statements and Exhibits
Exhibit No.
Description
4.1
Indenture, dated June 21, 2017, between PROS Holdings,
Inc. and Wilmington Trust, National Association, as
trustee.



PROS Holdings, Inc. Exhibit
EX-4.1 2 ex41notesindenture.htm INDENTURE Exhibit EXHIBIT 4.1PROS HOLDINGS,…
To view the full exhibit click here
About PROS Holdings, Inc. (NYSE:PRO)

PROS Holdings, Inc. provides enterprise revenue and profit realization software solutions. The Company’s software solutions are designed to help business-to-business (B2B) and business-to-consumer (B2C) companies. The Company also provides professional services to implement its software applications. The Company provides its solutions to enterprises across a range of industries, including manufacturing, distribution, services and travel. In addition, the Company provides product maintenance and support to its customers to receive unspecified upgrades, maintenance releases and bug fixes during the term of the support period on a when-and-if-available basis. Its SellingPRO solutions include editions, such as SellingPRO Deal Desk, SellingPRO Smart CPQ and SellingPRO eCommerce. The Company offers revenue management solutions as integrated software solutions. It provides software-related professional services, including implementation and configuration services, consulting and training.

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