By Abigail W. Adams
Portland, Me., May 25 – Cutera Inc. priced $200 million of six-year convertible notes after the market close on Tuesday at par at the cheap end of talk with a coupon of 2.25% and an initial conversion premium of 27.5%, according to a company press release and a market source.
Price talk was for a coupon of 1.75% to 2.25% and an initial conversion premium of 27.5% to 32.5%.
Goldman Sachs & Co. LLC was the bookrunner for the Rule 144A offering, which carries a greenshoe of $30 million.
In a concurrent private placement, entities affiliated with Cutera’s chairman, J. Daniel Plants, purchased $10 million of the aggregate amount of notes offered.
The notes are non-callable until June 5, 2025 and are then subject to a 130% hurdle.
They are putable upon a fundamental change.
Cutera entered into privately negotiated transactions with holders of its 2.25% convertible notes due 2026 to exchange $69.1 million in principal for $45.8 million in cash and 1.4 million shares.
In connection with the offering, the company entered into capped call transactions with a cap price of $82.62, which represents a premium of 100% over the closing price of stock on May 24.
Proceeds will be used to cover the cost of the call spread, to fund the exchange of the 2.25% notes and for general corporate purposes, which may include potential acquisitions and strategic transactions.
Cutera is a Brisbane, Calif.-based cosmetic and aesthetic laser equipment maker.
| Issuer: | Cutera Inc.
|
| Amount: | $200 million
|
| Greenshoe: | $30 million
|
| Issue: | Convertible senior notes
|
| Maturity: | June 1, 2028
|
| Bookrunner: | Goldman Sachs & Co. LLC
|
| Coupon: | 2.25%
|
| Price: | Par
|
| Yield: | 2.25%
|
| Conversion premium: | 27.5%
|
| Conversion price: | $52.67
|
| Conversion rate: | 18.9860
|
| Call options: | Non-callable until June 5, 2025 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | May 24
|
| Settlement date: | May 27
|
| 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: | $41.31 at market close May 24
|
| Market capitalization: | $750.33 million
|
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