Guidewire Software, Inc. Announces Proposed Public Offerings of $200 million of Common Stock and $300 million of Convertible Senior Notes
The Notes will be senior, unsecured obligations of Guidewire, and interest will be payable semi-annually in arrears. The Notes will be convertible into cash, shares of Guidewire’s common stock or a combination thereof, at Guidewire’s election. The interest rate, conversion rate and other terms of the Notes are to be determined upon pricing of the offering. The Notes will also be redeemable at the option of Guidewire after a specified date if certain conditions are met.
In connection with the pricing of the Notes, Guidewire expects to enter into capped call transactions with one or more of the underwriters of the Notes Offering and/or their respective affiliates and/or other financial institutions (the “option counterparties”). The capped call transactions are expected generally to reduce or offset the potential dilution to Guidewire’s common stock upon any conversion of Notes with such reduction and/or offset subject to a cap based on the cap price. If the underwriters of the Notes Offering exercise their option to purchase additional Notes, Guidewire expects to enter into additional capped call transactions with the option counterparties.
Guidewire expects that, in connection with establishing their initial hedges of the capped call transactions, the option counterparties or their respective affiliates will enter into various derivative transactions with respect to Guidewire’s 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 the common stock or the Notes at that time. In addition, Guidewire expects that the option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to the common stock and/or by purchasing or selling shares of the common stock or other securities of Guidewire in secondary market transactions following the pricing of the Notes and prior to the maturity of the Notes (and are likely to do so during any observation period related to a conversion of the Notes). This activity could also cause or avoid an increase or a decrease in the market price of the common stock or the Notes, which could affect the ability of holders of Notes to convert the Notes and, to the extent the activity occurs during any observation period related to a conversion of the Notes, it could affect the number of shares of common stock and value of the consideration that holders of Notes will receive upon conversion of the Notes.
Guidewire expects to use a portion of the net proceeds of the Notes Offering to pay the cost of the capped call transactions described above and the remaining net proceeds from the Notes Offering, together with the net proceeds from the Shares Offering, for working capital and other general corporate purposes. In addition, Guidewire may use a portion of the net proceeds to acquire or invest in complementary companies, product lines, products or technologies. However, Guidewire has no understandings or agreements with respect to any such acquisition or investment.
The Shares Offering and the Notes Offering will be made pursuant to
Guidewire’s shelf registration statement (including a base prospectus),
a preliminary prospectus supplement related to the Shares Offering
(together with such base prospectus, the “Shares Prospectus”) and a
preliminary prospectus supplement related to the Notes Offering
(together with such base prospectus, the “Notes Prospectus”), all of
which Guidewire filed with the
This press release does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any offer or sale of, the Shares or the Notes (or any shares of Guidewire’s common stock issuable upon conversion of the Notes) in any state or jurisdiction in which the offer, solicitation, or sale of the notes would be unlawful prior to the registration or qualification thereof under the securities laws of any such state or jurisdiction.
This press release contains “forward-looking statements” within the
meaning of the “safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995, including but not limited to, whether
Guidewire will be able to consummate the Shares Offering or the Notes
Offering, the final terms of the Shares Offering, the Notes Offering and
the capped call transactions, the satisfaction of customary closing
conditions with respect to the Shares Offering and the Notes Offering,
prevailing market conditions, the anticipated use of net proceeds of the
Shares Offering and the Notes Offering, which could change as a result
of market conditions or for other reasons, whether the capped call
transactions will become effective, and the impact of general economic,
industry or political conditions in
ICR, LLC for Guidewire Software, Inc.
Garo Toomajanian, 650-357-5282