WATERLOO, Ontario, Jan. 24, 2024 /PRNewswire/ — BlackBerry Limited (NYSE: BB; TSX: BB) (“BlackBerry”) proclaimed today the pricing of its private offering of $175 million aggregate principal amount of its 3.00% Convertible Senior Notes due 2029 (the “notes”) at an roughly 32.50% evolution bonus to the closing share price of $2.93 on The New York Stock Exchange on January 24, 2024. The notes were extended only to persons reasonably believed to be accomplished institutional buyers in accordance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and pursuant to prospectus exclusions in Canada and other jurisdictions. BlackBerry also granted the preliminary buyers of the notes the prerogative to purchase, within a 13-day period beginning on, and including, the date on which the notes are first issued, up to an additional $25 million aggregate principal amount of the notes. The proposition was increased from the previously declared offering of $160 million aggregate principal amount of notes. The closing of the proposal is awaited to happen on January 29, 2024, subject to regulated closing restrictions, including approval from the Toronto Stock Exchange.
It is anticipated by BlackBerry that the net proceeds from the proposition will be approximately $169.6 million (or approximately $194.0 million if the initial buyers work out their option to purchase additional notes in full), after taking away fees and approximated proposing expenditures payable by BlackBerry. BlackBerry aims to use the net proceeds from the proposition of the notes to finance the repayment or purchase of its outstanding $150 million aggregate principal amount of 1.75% extendible convertible unsecured debentures due February 15, 2024 (the “Existing Debentures”) and the remainder for general company goals.
The notes will be BlackBerry’s general unprotected responsibilities, ranking senior to BlackBerry’s obligations under the Existing Debentures. The notes will bear interest at a rate of 3.00% per annum, payable semiannually retroactively on February 15 and August 15 of each year, commencing on August 15, 2024, and the notes will mature on February 15, 2029, unless earlier changed, redeemed or bought back. The opening transformation rate of the notes is 257.5826 general shares per $1,000 principal amount of the notes, which is equivalent to an opening conversion price of approximately $3.88 per general share, representing a premium of approximately 32.50% over the closing share price of $2.93 on The New York Stock Exchange on January 24, 2024. Prior to the close of company on the business day right before November 15, 2028, the notes will be convertible only upon fulfillment of certain terms and during certain periods, and thereafter, at any time until the close of company on the second scheduled trading day immediately before February 15, 2029. BlackBerry may meet any changes of the notes by paying or multiple, as the instance may be, money, its general shares or a blend of money and its general shares, at BlackBerry’s selection (or, in the event of any notes commanded for redemption that are altered during the connected redemption period, only its general shares).
BlackBerry may not redeem the notes prior to February 22, 2027, except in the case of definite tax law changes. On or after February 22, 2027, BlackBerry may redeem for money all or a portion of the notes, at Blackberry’s choice, if the last stated sale price of Blackberry’s general shares has been at least 130% of the conversion price then in effect on each of at least 20 trading days (whether or not successive) during any 30 successive trading-day period (including the last trading day of such period) ending on, and including, the trading day immediately before the date on which BlackBerry furnishes notice of redemption at a cash redemption price equal to 100% of the aggregate principal amount of the notes to be redeemed, plus accumulated and overdue interest to, but excluding, the redemption date. If BlackBerry undergoes a important change (as defined in the covenant governing the notes), subject to certain conditions, BlackBerry will be required to make an offer to repurchase for cash all of the outstanding notes (or any portion thereof that a holder stipulates to sell to BlackBerry) at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accumulated and overdue interest, if any, to, but not including, the important change repurchase date. In relationship with definite corporate events or if BlackBerry calls the notes for redemption, BlackBerry will, under certain circumstances, increase the transformation rate for noteholders who choose to convert their notes in connection with such corporate event or convert their notes called for redemption.
The offer and sale of the notes and the general shares issuable upon conversion of the notes, if any, have not been registered under the Securities Act or any state securities laws. Unless a subsequent sale is registered under the Securities Act, the notes and general shares issuable upon conversion of the notes, if any, may only be proposed or proposed in the United States in a transaction that is exempt from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws.
This press release does not establish an offer to sell or a solicitation of an offer to buy any of these securities nor shall there be any sale of these securities in any state or locality in which such an offer, solicitation or sale would be illegal before the registration or entitlement under the securities laws of any such state or locality. Any offers of the notes will be made only to persons reasonably believed to be accomplished institutional buyers by means of a private offering memorandum in accordance with Rule 144A under the Securities Act. The notes will be proposed in Canada and other jurisdictions under obtainable prospectus exclusions.
BlackBerry (NYSE: BB; TSX: BB) provides intelligent protection software and services to enterprises and governments around the world. The company’s software powers over 235M vehicles. Based in Waterloo, Ontario, the company leverages AI and machine learning to deliver innovative solutions in the areas of cybersecurity, safety and data privacy solutions, and is a leader in the areas of endpoint security management, encryption, and embedded systems. BlackBerry’s vision is clear – to secure a connected future you can trust.
BlackBerry. Intelligent Security. Everywhere.
For more information, visit BlackBerry.com and follow @BlackBerry.
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Cautionary Note Regarding Forward-Looking Statements
Some statements in this press release, including, among others: the potential workout of the initial investors’ option to purchase additional notes; the anticipated timing of the closing of the offering of the notes; and the anticipated use of the net proceeds from the sale of the notes, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. Forward-looking statements are often characterized by the use of words such as “believes,” “estimates,” “expects,” “projects,” “may,” “will,” “intends,” “plans,” “should,” or “anticipates,” and similar expressions. All forward-looking statements in this press release are based on current expectations, forecasts, estimates and assumptions made by BlackBerry in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors that BlackBerry believes are appropriate in the circumstances, and involve risks, uncertainties and other factors that could cause actual results, performance or achievements to differ materially from those expressed in or implied by the forward-looking statements.
Additional factors that could cause results to differ materially from those projected in the forward-looking statements are contained in BlackBerry’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, including in the “Cautionary Note Regarding Forward-Looking Statements” section of BlackBerry’s MD&A (copies of which may be obtained at www.sedarplus.ca or www.sec.gov). All of these factors should be considered carefully, and readers should not place undue reliance on BlackBerry’s forward-looking statements. Forward-looking statements are intended to enable BlackBerry’s shareholders to view the anticipated performance and prospects of BlackBerry from management’s perspective at the time such statements are made, and they are subject to the risks that are inherent in all forward-looking statements, as described above, as well as difficulties in forecasting BlackBerry’s financial results and performance for future periods, particularly over longer periods, given changes in technology and BlackBerry’s business strategy, evolving industry standards, intense competition and short product life cycles that characterize the industries in which BlackBerry operates. BlackBerry has no intention and undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
SOURCE BlackBerry Limited