01—Abstract
Summary
Summary of the 8-K filed January 14, 2025. Cited figures are marked; the original filing is the authoritative source.
Dell Technologies Inc. (DELL) filed an 8-K on January 14, 2025, to report on the unregistered sale of equity securities.
Specifically, the company disclosed the conversion of 3,991,503 shares of Class B common stock into the same number of Class C common stock shares. These conversions occurred on various dates between December 5, 2024, and January 8, 2025, and were primarily held by entities affiliated with Silver Lake. The filing also clarifies Dell's stock structure, noting that as of January 8, 2025, there were 358,574,323 shares of Class C common stock and 62,368,123 shares of Class B common stock outstanding.
The Class B common stock is convertible into Class C common stock on a one-to-one basis, either optionally by the holder or automatically upon certain transfers. This conversion activity is being conducted under an exemption from registration, as provided by Section 3(a)(9) of the Securities Act of 1933.
02—Key points
Key Highlights
- Dell Technologies Inc. reported the conversion of nearly 4 million shares of Class B common stock into Class C common stock between December 2024 and January 2025.
- The conversions were primarily executed by entities affiliated with Silver Lake, a significant investor in Dell.
- As of January 8, 2025, Dell has 358,574,323 shares of Class C common stock and 62,368,123 shares of Class B common stock outstanding.
- Holders of Class B common stock have the right to convert their shares into Class C common stock on a one-to-one basis at any time.
- Automatic conversion of Class B to Class C shares is triggered by certain transfers.
- The Class C common stock carries the same dividend and liquidation rights as Class B common stock.
- The stock conversions were conducted without registration, in reliance on the Section 3(a)(9) exemption under the Securities Act of 1933.
03—Questions
Frequently Asked Questions
What is the main purpose of this 8-K filing?
The primary purpose of this 8-K filing is to report on the unregistered sales of equity securities, specifically the conversion of Dell's Class B common stock into Class C common stock, and to update the outstanding share counts.
Who were the primary holders converting their shares?
The conversions were executed by entities affiliated with Silver Lake, including SL SPV-2, L.P., Silver Lake Partners IV, L.P., Silver Lake Technology Investors IV, L.P., Silver Lake Partners V DE (AIV), L.P., and Silver Lake Technology Investors V, L.P.
Does this conversion impact the total number of outstanding shares or the value of my investment?
The conversion of Class B to Class C common stock does not change the total number of common shares outstanding, nor does it alter the underlying equity value or economic rights (like dividends and liquidation preferences) of these shares, as they are converted on a one-to-one basis and have equivalent rights. It mainly reclassifies shares from Class B to Class C.
Why were these shares converted without registration?
Dell utilized the exemption from registration provided by Section 3(a)(9) of the Securities Act of 1933. This exemption typically applies to exchanges of securities where no commission or remuneration is paid for soliciting the exchange, as was stated in the filing.
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