In connection with establishing their initial hedge of the capped call transactions, the capped call counterparties or their respective affiliates expect to enter into various derivative transactions with respect to Shift’s Class A common stock and/or purchase shares of Shift’s Class A common stock concurrently with, or shortly after, the pricing of the notes. If the initial purchasers exercise their option to purchase additional notes, Shift expects to enter into additional capped call transactions with the capped call counterparties. The capped call transactions are expected generally to reduce the potential dilution to Shift’s Class A common stock upon any conversion of notes and/or offset any potential cash payments Shift is required to make in excess of the principal amount of converted notes, as the case may be, with such reduction and/or offset subject to cap. The capped call transactions will cover, subject to anti-dilution adjustments substantially similar to those applicable to the notes, the number of shares of Shift’s Class A common stock that will initially underlie the notes.
In connection with the pricing of the notes, Shift expects to enter into privately negotiated capped call transactions with one or more of the initial purchasers of the notes and/or their affiliates or other financial institutions (the "capped call counterparties"). The interest rate, initial conversion rate and other terms of the notes are to be determined upon pricing of the offering. The notes will be convertible into cash, shares of Shift's Class A common stock, or a combination thereof, at Shift's election. The notes will be senior unsecured obligations of Shift, and interest will be payable semi-annually in arrears. Shift also expects to grant the initial purchasers of the notes an option to purchase, for settlement within a period of 13 days from, and including, the date the notes are first issued, up to an additional $11.25 million aggregate principal amount of the notes.
(NASDAQ: SFT) today announced its intention to offer, subject to market conditions and other factors, $75,000,000 aggregate principal amount of convertible senior notes due 2026 (the "notes") in a private offering only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Act"). No cash balance or cash flow is included in the calculation.SAN FRANCISCO, (GLOBE NEWSWIRE) - Shift Technologies, Inc. Please note all regulatory considerations regarding the presentation of fees must be taken into account. Backtested results are adjusted to reflect the reinvestment of dividends and other income and, except where otherwise indicated, are presented gross-of fees and do not include the effect of backtested transaction costs, management fees, performance fees or expenses, if applicable. Actual performance may differ significantly from backtested performance. Further, backtesting allows the security selection methodology to be adjusted until past returns are maximized. Since trades have not actually been executed, results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity, and may not reflect the impact that certain economic or market factors may have had on the decision-making process. Specifically, backtested results do not reflect actual trading or the effect of material economic and market factors on the decision-making process. Backtested performance is developed with the benefit of hindsight and has inherent limitations. This information is provided for illustrative purposes only. No representations and warranties are made as to the reasonableness of the assumptions. Certain assumptions have been made for modeling purposes and are unlikely to be realized. Changes in these assumptions may have a material impact on the backtested returns presented. General assumptions include: XYZ firm would have been able to purchase the securities recommended by the model and the markets were sufficiently liquid to permit all trading. Backtested results are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. Backtested performance is not an indicator of future actual results. Disclaimer: The TipRanks Smart Score performance is based on backtested results.
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