LOS
ANGELES, Jan. 9, 2023 /PRNewswire/ -- Live Nation
Entertainment, Inc. (NYSE: LYV) (the "company") today announced
that it intends to offer, subject to market and other conditions,
$850.0 million in aggregate principal
amount of convertible senior notes due 2029 (the "Convertible
Notes"). The company intends to use a portion of the net proceeds
from the Convertible Notes offering to fund the cost of entering
into the capped call transactions described below. The company
intends to use the remainder of the net proceeds from the
Convertible Notes offering to effect the repurchase of a portion of
its 2.5% convertible senior notes due 2023 (the "existing
convertible notes") in one or more separate and individually
negotiated transactions with one or more holders of the existing
convertible notes, to pay related fees and expenses and for general
corporate purposes, which may include the repayment or repurchase
of certain of its outstanding indebtedness.
In connection with the Convertible Notes offering, the company
expects to grant the initial purchasers the right to purchase, for
settlement within a 13-day period beginning on, and including, the
date the Convertible Notes are first issued, up to an additional
$85.0 million aggregate principal
amount of Convertible Notes. If the initial purchasers exercise
their option to purchase additional Convertible Notes, then the
company intends to use a portion of the additional net proceeds to
fund the cost of entering into additional capped call transactions
as described below.
The Convertible Notes will accrue interest payable semi-annually
in arrears and will mature on January 15,
2029, unless repurchased, redeemed or converted in
accordance with their terms prior to such date. Prior to the close
of business on the business day immediately preceding October 15, 2028, the Convertible Notes will be
convertible only upon satisfaction of certain conditions and during
certain periods; thereafter, the Convertible 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, holders of the Convertible Notes will receive shares of
the company's common stock, cash or a combination thereof, at the
company's election. Holders of the Convertible Notes will have the
right to require the company to repurchase all or a portion of
their Convertible Notes at 100% of their principal, plus any
accrued and unpaid interest, upon the occurrence of certain
corporate events constituting a "fundamental change" as defined in
the indenture for the Convertible Notes. The company may not redeem
the Convertible Notes prior to January 21,
2026. The company may redeem for cash all or any portion of
the Convertible Notes, at its option, on a redemption date
occurring on or after January 21,
2026 and before the 41st scheduled trading day before the
maturity date, but only if the last reported sale price of the
company's common stock has been at least 130% of the conversion
price then in effect for a specified period of time. The redemption
price will equal 100% of the principal amount of the Convertible
Notes to be redeemed, plus any accrued and unpaid interest to, but
excluding, the redemption date.
In connection with the pricing of the Convertible Notes, the
company expects to enter into privately negotiated capped call
transactions with one or more of the initial purchasers or their
affiliates and/or other financial institutions (the "option
counterparties"). The capped call transactions are expected to
initially cover, subject to anti-dilution adjustments substantially
similar to those applicable to the Convertible Notes, the number of
shares of the company's common stock underlying the Convertible
Notes. If the initial purchasers exercise their option to purchase
additional Convertible Notes, the company expects to enter into
additional capped call transactions with the option
counterparties.
The capped call transactions are expected generally to reduce
the potential dilution to the company's common stock upon any
conversion of the Convertible Notes and/or offset any potential
cash payments the company is required to make in excess of the
principal amount of converted notes, as the case may be. If,
however, the market price per share of the company's common stock,
as measured under the terms of the capped call transactions,
exceeds the cap price of the capped call transactions, there would
nevertheless be dilution and/or there would not be an offset of
such potential cash payments, in each case, to the extent that such
market price exceeds the cap price of the capped call
transactions.
In connection with establishing their initial hedges of the
capped call transactions, the option counterparties or their
respective affiliates expect to enter into various derivative
transactions with respect to the company's common stock and/or
purchase shares of the company's common stock concurrently with or
shortly after the pricing of the Convertible Notes. This activity
could increase (or reduce the size of any decrease in) the market
price of the company's common stock or the Convertible Notes at
that time.
In addition, the option counterparties or their respective
affiliates may modify their hedge positions by entering into or
unwinding various derivatives with respect to the company's common
stock and/or purchasing or selling shares of the company's common
stock or other securities of the company in secondary market
transactions following the pricing of the Convertible Notes and
prior to the maturity of the Convertible Notes (and (x) are likely
to do so during any conversion reference period related to a
conversion of the Convertible Notes or following any repurchase of
the Convertible Notes by the company in connection with any
fundamental change and (y) are likely to do so following any
repurchase of the Convertible Notes by the company other than in
connection with any fundamental change if the company elects to
unwind a corresponding portion of the capped call transactions in
connection with such repurchase). This activity could also cause or
avoid an increase or decrease in the market price of the company's
common stock or the Convertible Notes, which could affect the
holders' ability to convert the Convertible Notes and, to the
extent the activity occurs following conversion or during any
conversion reference period related to a conversion of the
Convertible Notes, it could affect the number of shares of the
company's common stock and value of the consideration that holders
will receive upon conversion of the Convertible Notes.
In connection with the pricing of the Convertible Notes, the
company also expects to repurchase the existing convertible notes
in one or more separate and individually negotiated transactions
with one or more holders of the existing convertible notes. The
company expects that holders of the existing convertible notes that
sell their existing convertible notes as described above may enter
into or unwind various derivatives with respect to the company's
common stock (including entering into derivatives with one or more
of the initial purchasers in the Convertible Notes offering or
their respective affiliates) and/or purchase or sell shares of the
company's common stock concurrently with or shortly after the
pricing of the Convertible Notes. The repurchase of the existing
convertible notes, and the potential related market activities by
holders of the existing convertible notes participating in the
repurchases, could increase (or reduce the size of any decrease in)
or decrease (or reduce the size of any increase in) the market
price of the company's common stock, which may affect the trading
price of the Convertible Notes at that time and the initial
conversion price of the Convertible Notes. The company cannot
predict the magnitude of such market activity or the overall effect
it will have on the price of the Convertible Notes or its common
stock.
The Convertible Notes will be offered through a private
placement and will not be registered under the Securities Act of
1933, as amended (the "Securities Act"), or any state securities
laws. As a result, the Convertible Notes and any common stock
issuable upon conversion of the Convertible Notes may not be
offered or sold in the United
States except pursuant to an applicable exemption from, or
in a transaction not subject to, the registration requirements of
the Securities Act. Accordingly, the Convertible Notes will be
offered only to persons reasonably believed to be "qualified
institutional buyers" under Rule 144A of the Securities Act. This
news release is neither an offer to sell nor a solicitation of an
offer to buy the Convertible Notes or any common stock issuable
upon conversion of the Convertible Notes, nor shall there be any
sale of any securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful.
Forward-Looking Statements
This news release contains
forward-looking statements, including statements related to the
offerings and the expected use of the net proceeds, which are based
on current expectations, forecasts and assumptions that involve
risks and uncertainties that could cause actual results to differ
materially from any future results, performance or achievements
expressed or implied by such forward-looking statements. These
risks and uncertainties include, without limitation, risks related
to whether the company will consummate the offering of the
Convertible Notes on the expected terms, or at all, the anticipated
terms of, and the effects of entering into, the capped call
transactions described above, market and other general economic
conditions, and the fact that the company's management will have
discretion in the use of the proceeds from the sale of the
Convertible Notes. The company refers you to the documents it files
with the Securities and Exchange Commission, specifically the
section titled "Item 1A. Risk Factors" of its annual report on Form
10-K for the year ended December 31,
2021, which contains and identifies important factors that
could cause actual results to differ materially from those
contained in the company's projections or forward-looking
statements. You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date on
which they are made. The company undertakes no obligation to update
any forward-looking statement, whether as a result of changes in
underlying factors, new information, future events or
otherwise.
About Live Nation Entertainment
Live Nation
Entertainment (NYSE: LYV) is the world's leading live entertainment
company comprised of global market leaders: Ticketmaster, Live
Nation Concerts, and Live Nation Sponsorship.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/live-nation-entertainment-announces-launch-of-convertible-senior-notes-offering-301716420.html
SOURCE Live Nation Entertainment