01—Abstract
Summary
Summary of the 8-K filed April 5, 2006. Cited figures are marked; the original filing is the authoritative source.
Ciena Corporation (CIEN) filed an 8-K on April 5, 2006, to report a significant financing event.
The company entered into an Underwriting Agreement with Goldman, Sachs & Co. to issue $300 milliona in 0.250% Convertible Senior Notes due 2013. This offering, conducted under a Form S-3 registration statement, is expected to yield net proceeds of approximately $292.5 million after deducting underwriting discounts but before expenses. The company also disclosed the potential for an additional $45 million in notes to be purchased by the underwriter within a 13-day option period.
These notes are convertible into Ciena's common stock, with the potential to issue up to approximately 61.1 million shares upon conversion, subject to adjustments. The conversion is anticipated to be exempt from registration under Section 3(a)(9) of the Securities Act of 1933.
02—Key points
Key Highlights
- Ciena Corporation raised $300 million through the issuance of 0.250% Convertible Senior Notes due 2013.
- Net proceeds from the offering are estimated to be $292.5 million, before deducting expenses.
- The company has granted an over-allotment option to the underwriter (Goldman, Sachs & Co.) for an additional $45 million in notes.
- The notes are convertible into Ciena's common stock, with a potential issuance of up to approximately 61.1 million shares.
- The conversion of notes into common stock is expected to be exempt from registration requirements under Section 3(a)(9) of the Securities Act of 1933.
- The offering was conducted via a public offering under Ciena's Form S-3 registration statement.
03—Questions
Frequently Asked Questions
What is the main purpose of this 8-K filing?
This 8-K filing announces Ciena Corporation's entry into a material definitive agreement for the public offering of $300 million in Convertible Senior Notes due 2013.
How much money did Ciena Corporation raise from this note offering?
Ciena Corporation raised $300 million in aggregate principal amount of notes, with expected net proceeds of $292.5 million after underwriting discounts and before expenses.
Can investors convert these notes into Ciena's stock, and if so, how many shares could be issued?
Yes, the notes are convertible into Ciena's common stock. Upon conversion, up to approximately 61,099,811 shares of common stock could be issued, subject to adjustments as detailed in the Prospectus Supplement.
What is the significance of the convertible feature for Ciena?
The convertible feature allows Ciena to potentially issue new shares of common stock upon conversion of the notes. This can dilute existing shareholders but provides Ciena with flexibility in its capital structure and allows it to raise funds at a lower interest rate due to the equity conversion option.
04—Continue