By Abigail W. Adams
Portland, Me., March 5 – Cutera Inc. priced $125 million of five-year convertible notes after the market close on Thursday at par with a coupon of 2.25% and an initial conversion premium of 27.5%, according to a company news release.
The convertibles priced at the cheap end of talk, which called for a coupon of 1.75% to 2.25% and an initial conversion premium of 27.5% to 32.5%, according to a market source.
Stifel, Nicolaus & Co. Inc. is the active bookrunner and Cantor Fitzgerald & Co. is a passive bookrunner for the Rule 144A offering, which carries a downsized greenshoe of $13.25 million.
The initial size of the greenshoe was $25 million.
The notes are non-callable until March 20, 2024 and then subject to a 130% hurdle.
They are putable upon a fundamental change.
The notes will be settled in cash, shares or a combination of both at the company’s option.
In connection with the offering, the company entered into capped call transactions with a cap price of $45.54, which represents a premium of 75% over the last reported sales price of stock.
Net proceeds are expected to be $120.7 million or will be $133.5 million if the greenshoe is exercised in full.
Proceeds will be used to cover the cost of the call spread and for general corporate purposes, which may include capital expenditures and potential acquisitions and strategic transactions.
Cutera is a Brisbane, Calif.-based cosmetic and aesthetic laser equipment maker.
| Issuer: | Cutera Inc.
|
| Securities: | Convertible senior notes
|
| Amount: | $125 million
|
| Greenshoe: | $13.25 million
|
| Maturity: | March 15, 2026
|
| Bookrunners: | Stifel, Nicolaus & Co. Inc. (active), Cantor Fitzgerald & Co. (passive)
|
| Coupon: | 2.25%
|
| Price: | Par
|
| Yield: | 2.25%
|
| Conversion premium: | 27.5%
|
| Conversion price: | $33.18
|
| Conversion rate: | 30.1427
|
| Call options: | Non-callable until March 20, 2024 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | March 4
|
| Settlement date: | March 9
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 1.75% to 2.25% and initial conversion premium of 27.5% to 32.5%
|
| Stock symbol: | Nasdaq: CUTR
|
| Stock price: | $26.02 at market close March 5
|
| Market capitalization: | $458.8 million
|
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