VIAVI SOLUTIONS INC. (NASDAQ:VIAV) Files An 8-K Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
Item2.03
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Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
On March22, 2017, Viavi Solutions Inc. (Viavi) sold an additional
$60 million aggregate principal amount of 1.00% Senior
Convertible Notes due 2024 (the Additional Notes) in a private
placement to qualified institutional buyers to Rule 144A under
the Securities Act of 1933, as amended (the Securities Act). The
Additional Notes were issued upon the exercise by the initial
purchasers of an over-allotment option granted by Viavi. Viavi
previously issued $400 million aggregate principal amount of
1.00% Senior Convertible Notes due 2024 on March3, 2017 (the
Initial Notes and, together with the Additional Notes, the
Notes). The issuance of the Additional Notes brings the total
aggregate principal amount of Notes outstanding to $460 million.
The Notes were issued to an Indenture, dated March3, 2017 (the
Indenture), between Viavi and Wells Fargo Bank, National
Association, as trustee.
The sale of the Notes generated net proceeds of approximately
$451.2 million after deducting the initial purchasers discounts
and commissions and the estimated offering expenses payable by
Viavi. Viavi intends to use net proceeds from the offering for
refinancing, together with its cash on hand, its outstanding
0.625% Senior Convertible Notes due 2033 (the 2033 Notes),
including opportunistically repurchasing 2033 Notes in the
future, as well as for general corporate purposes. In addition,
Viavi used $50 million of the net proceeds from the offering of
the Initial Notes to repurchase shares of its common stock to its
existing stock repurchase program. The repurchase of common stock
occurred concurrently with the offering of the Initial Notes in
privately negotiated transactions with institutional investors
through one or more of the initial purchasers of the Notes or
their respective affiliates as Viavis agent. The purchase price
of the common stock repurchased in such transactions was the
closing price per share of Viavis common stock on the date of the
pricing of the offering.
The Notes mature on March1, 2024, unless earlier converted or
repurchased. The Notes are Viavis general senior unsecured
obligations and rank equal in right of payment with all of Viavis
existing and future unsecured, unsubordinated indebtedness,
including the 2033 Notes, and senior in right of payment to any
indebtedness that is contractually subordinated to the Notes.
Viavi will pay interest on the Notes at an annual rate of 1.00%
payable in cash semiannually in arrears on March1 and September1
of each year, beginning September1, 2017. The holders of the
Notes may convert the Notes into cash and shares of Viavis common
stock, if any, based upon an initial conversion rate of 75.6229
shares of Viavis common stock per $1,000 principal amount of
Notes (which is equal to an initial conversion price of
approximately $13.22 per share of Viavis common stock,
representing an approximately 32.5% conversion premium based on
the closing price of $9.98 per share of Viavis common stock on
February27, 2017), subject to adjustment as provided for in the
Indenture.
The Notes may be converted at any time on or prior to the close
of business on the business day immediately preceding December1,
2023, in multiples of $1,000 principal amount, at the option of
the holder only under the following circumstances: (i)on any date
during any
calendar quarter beginning after June30, 2017 (and only during
such calendar quarter) if the closing price of Viavis common
stock was more than 130% of the then current conversion price for
at least 20 trading days (whether or not consecutive) during the
30 consecutive trading-day period ending on the last trading day
of the previous calendar quarter, (ii)upon the occurrence of
specified corporate events, (iii)if Viavi is party to a specified
transaction, a fundamental change or a make-whole fundamental
change (each as defined in the Indenture), or (iv)during the five
consecutive business-day period immediately following any 10
consecutive trading-day period in which the trading price per
$1,000 principal amount of the Notes for each day during such 10
consecutive trading-day period was less than 98% of the product
of the closing sale price of Viavis common stock and the
applicable conversion rate on such date. During the periods from,
and including, December1, 2023 until the close of business on the
business day immediately preceding the maturity date, holders of
the Notes may convert the Notes regardless of the circumstances
described in the immediately preceding sentence.
Holders of the Notes may require Viavi to repurchase for cash all
or a portion of the Notes upon the occurrence of a fundamental
change (as defined in the Indenture) at a repurchase price equal
to 50% of the principal amount of the Notes to be repurchased,
plus accrued and unpaid interest to, but excluding, the date of
repurchase.
The Indenture provides for customary events of default, including
payment defaults, breaches of covenants, failure to pay certain
judgments and certain events of bankruptcy, insolvency and
reorganization. If an event of default occurs and is continuing,
the principal amount of the Notes, plus accrued and unpaid
interest, if any, may be declared immediately due and payable,
subject to certain conditions set forth in the Indenture. These
amounts automatically become due and payable if an event of
default relating to certain events of bankruptcy, insolvency or
reorganization occurs.
Viavi offered and sold the Notes to the initial purchasers in
reliance on the exemption from registration provided by
Section4(a)(2) of the Securities Act, for resale by the initial
purchasers to qualified institutional buyers (as defined in the
Securities Act) to the exemption from registration provided by
Rule 144A under the Securities Act. Viavi relied on these
exemptions from registration based in part on representations
made by the initial purchasers in the purchase agreement executed
in connection with the sale of the Notes.
The foregoing description of the Indenture and the Notes does not
purport to be complete and is qualified in its entirety by
reference to the full text of the Indenture and the Form of the
Notes (a form of which is attached as an exhibit to the
Indenture), filed as Exhibit 4.1 and Exhibit 4.2, respectively,
hereto and incorporated herein by reference.
Neither the Notes nor the common stock that may be issued upon
conversion thereof will be registered under the Securities Act.
Neither the Notes nor the common stock that may be issued upon
conversion thereof may be offered or sold in the United States
absent registration or an applicable exemption from the
registration requirements of the Securities Act. This Current
Report on Form8-K
does not constitute an offer to sell, or a solicitation of an
offer to buy, any security and shall not constitute an offer,
solicitation or sale in any jurisdiction in which such offer,
solicitation or sale would be unlawful.
| Item3.02 | Unregistered Sales of Equity Securities. |
The information
set forth under Item2.03 of this Current Report is incorporated
herein by reference.
| Item9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits |
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ExhibitNo. |
Description |
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| 4.1 |
Indenture, dated as of March 3, 2017, between Viavi Solutions Inc. and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 of Viavis Current Report on Form 8-K filed on March 6, 2017). |
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| 4.2 |
Form of 1.00% Senior Convertible Notes due 2024 (incorporated by reference to Exhibit 4.2 of Viavis Current Report on Form 8-K filed on March 6, 2017). |
About VIAVI SOLUTIONS INC. (NASDAQ:VIAV)
Viavi Solutions Inc. (Viavi) is a provider of network test, monitoring and assurance solutions to communications service providers, enterprises and their ecosystems. The Company also offers thin film optical coatings, providing light management solutions to anti-counterfeiting, consumer and industrial, government and healthcare and other markets. The Company’s segments include Network Enablement (NE), Service Enablement (SE), and Optical Security and Performance Products (OSP). The NE segment provides testing solutions that access the network to perform build-out and maintenance tasks. The SE segment offers solutions, which are embedded systems that yield network, service and application performance data. The OSP segment provides optical security solutions. The OSP segment’s security offerings for the currency market include Optically Variable Pigment (OVP), Optically Variable Magnetic Pigment (OVMP) and banknote thread substrates. VIAVI SOLUTIONS INC. (NASDAQ:VIAV) Recent Trading Information
VIAVI SOLUTIONS INC. (NASDAQ:VIAV) closed its last trading session up +0.19 at 10.81 with 3,615,451 shares trading hands.