What was the reason for the issuance of shares and warrants to Juniper Networks?

The shares and warrants were issued as part of a Settlement, Release and Cross-License Agreement to resolve all pending disputes between Palo Alto Networks and Juniper Networks.

Are the shares and warrants issued registered with the SEC?

No, the shares and warrants were issued under an exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933. However, Palo Alto Networks has committed to filing a registration statement (Form S-3) to allow for the resale of these securities.

What is the potential dilution to existing shareholders?

The issuance of 1,080,747 shares and the potential issuance of up to 463,177 shares upon exercise of the warrant represent a potential dilution. The total potential increase in outstanding shares from this settlement is approximately 1,543,924 shares. The exact dilutive impact will depend on the market price of PANW stock and whether the warrant is exercised.

When will the shares and warrant be registered for resale?

Palo Alto Networks expects to file the registration statement on Form S-3 for the resale of these securities no later than June 10, 2014.

PANW 8-K: Securities & Listing

Summary

Palo Alto Networks, Inc. (PANW) filed an 8-K on June 3, 2014, to disclose details regarding the unregistered sale of equity securities related to a settlement agreement with Juniper Networks, Inc. The company issued 1,080,747 shares of common stock and a warrant to purchase an additional 463,177 shares to Juniper Networks as part of resolving all pending disputes between the two companies. The shares were issued on May 27, 2014, valued at approximately $70 million, and the warrant, with an exercise price of $0.0001, was issued on June 3, 2014, valued at approximately $30 million and expiring January 3, 2015. These securities were issued under Section 4(a)(2) of the Securities Act of 1933, exempting them from registration requirements. Palo Alto Networks has committed to filing a Form S-3 registration statement by June 10, 2014, to allow for the resale of these shares and the shares underlying the warrant. This filing is significant for investors as it details the resolution of a material dispute and the subsequent issuance of a substantial block of shares, impacting potential dilution and shareholder equity.

Key Highlights

1Palo Alto Networks (PANW) resolved disputes with Juniper Networks, Inc. through a settlement agreement.
2PANW issued 1,080,747 shares of common stock to Juniper Networks valued at approximately $70 million.
3PANW issued a warrant to Juniper Networks to purchase 463,177 shares of common stock, valued at approximately $30 million.
4The warrant has a nominal exercise price of $0.0001 and an expiration date of January 3, 2015.
5The issuance of shares and the warrant were made under the exemption provided by Section 4(a)(2) of the Securities Act of 1933.
6PANW committed to filing a Form S-3 registration statement by June 10, 2014, to register the resale of the issued shares and shares underlying the warrant.

Palo Alto Networks Inc 8-K Report, Unregistered Securities Sale (Jun 4, 2014)

Summary

Key Highlights

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