Ms. Katie Keita reports
SHOPIFY PRICES OFFERINGS OF CLASS A SUBORDINATE VOTING SHARES AND CONVERTIBLE SENIOR NOTES
Shopify Inc. has priced its previously announced public offering of 1.1 million Class A subordinate voting shares at a price to the public of $900
(U.S.) per share and its previously announced public offering of $800-million (U.S.) aggregate principal amount of convertible senior notes due 2025. The gross proceeds from the equity offering, before underwriting discounts and offering costs, are expected to be $990-million (U.S.), and the gross proceeds from the note offering, before underwriting discounts and offering costs, are expected to be $800-milloin (U.S.). The equity offering and the note offering are not conditional upon one another.
Shopify has granted the equity
underwriters (as defined herein) an overallotment option to purchase up to an additional 165,000 Class A subordinate voting shares to be sold pursuant to the equity offering.
equity overallotment option is exercisable for a period of 30 days from the date of the final prospectus supplement relating to the equity offering. Shopify has also granted the note underwriters (as defined herein) an overallotment option to purchase up to an additional $120-million (U.S.) aggregate principal amount of notes. The note overallotment option is exercisable for a period of 30 days from the date of the final prospectus supplement relating to the note offering.
Shopify expects to use the net proceeds of the offerings to strengthen its balance sheet, providing flexibility to finance its growth strategies.
The closings of the equity offering and the note offering
are subject to a number of closing conditions, including the listing of the offered shares
and the approval to list the Class A subordinate voting shares underlying the notes on the New York Stock Exchange and the Toronto Stock Exchange, and any required approvals of each exchange, and are expected to occur on or about Sept. 18, 2020. The equity offering is being led by Citigroup, Goldman Sachs & Co. LLC and Credit Suisse, with RBC Capital Markets acting as co-manager, and the note offering is being led by Goldman Sachs & Co. LLC, Citigroup and Credit Suisse, with RBC Capital Markets acting as co-manager.
The notes will be senior, unsecured obligations of Shopify, and interest will be payable semi-annually in cash at a rate of 0.125 per cent per annum on May 1 and Nov. 1 of each year, beginning on May 1, 2021. The notes will mature on Nov. 1, 2025, unless redeemed, repurchased or converted prior to such date. Prior to Aug. 1, 2025, the notes will be convertible at the option of the holders during certain periods, upon satisfaction of certain conditions. Thereafter, the notes will be convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, the notes may be settled, at Shopify's election, in Shopify's Class A subordinate voting shares, cash or a combination thereof.
The notes will have an initial conversion rate of 0.6944 Class A subordinate voting shares per $1,000 (U.S.) principal amount of notes. This represents an initial conversion price of approximately $1,440 (U.S.) per Class A subordinate voting share. The initial conversion price of the notes represents a premium of approximately 60 per cent to the price per offered share in the equity offering.
Shopify has filed preliminary prospectus supplements for the offerings, and will file final prospectus supplements to its short-form base-shelf prospectus dated Aug. 6, 2020, with the securities regulatory authorities in each of the provinces and territories of Canada except Quebec. The preliminary prospectus supplements
have also been filed, and the final prospectus supplements will be filed, with the U.S. Securities and Exchange Commission, as supplements to Shopify's registration statement on Form F-10 under the U.S./Canada multijurisdictional disclosure system. The prospectus supplements, the base-shelf prospectus and the registration statement contain important detailed information about the offerings. Copies of the Canadian prospectus supplements and the base-shelf prospectus can be found on SEDAR, and copies of the U.S. prospectus supplements and the registration statement can be found on EDGAR. Copies of these documents may also be obtained from Citigroup, care of Broadridge Financial Solutions, 1155 Long Island Ave., Edgewood, N.Y., 11717, telephone: 1-800-831-9146; or Goldman Sachs & Co., attention: prospectus department, 200 West St., New York, N.Y., 10282, telephone: 866-471-2526, facsimile: 212-902-9316 or e-mail: email@example.com.
Prospective investors should read the prospectus supplements, the base-shelf prospectus and the registration statement before making an investment decision.
About Shopify Inc.
Shopify is a leading global commerce company, providing trusted tools to start, expand, market and manage a retail business of any size. Shopify makes commerce better for everyone with a platform and services that are engineered for reliability, while delivering a better shopping experience for consumers everywhere. Headquartered in Ottawa, Canada, Shopify powers over one million businesses in more than 175 countries and is trusted by brands such as Allbirds, Gymshark, Heinz, Staples and many more.
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