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VeriFone Announces Completion of Offering of $316.25 Million Senior Convertible Notes


VeriFone Holdings, Inc. (NYSE: PAY) today announced the completion of its placement of an aggregate of $316.25 million principal amount of 1.375% Senior Convertible Notes due 2012, which includes the initial purchasers’ exercise in full of their option to purchase additional notes. The offering was made through offerings to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).

In connection with the offering, VeriFone entered into convertible note hedge transactions with affiliates of the initial purchasers (the “counterparties”) that generally are expected to reduce the potential equity dilution upon conversion of the notes, including those being sold in connection with the overallotment option. VeriFone also has sold warrants to those counterparties, which could have a dilutive effect on its earnings per share. The warrants have an initial strike price of $62.356 per share which may reset, if higher, to a 70% premium over the market price of VeriFone’s common stock determined in approximately six months from the pricing of the offering.

VeriFone estimates that the net proceeds from the offering, after deducting the initial purchasers’ discounts and estimated offering expenses payable by VeriFone will be approximately $307.77 million. VeriFone intends to apply the net proceeds from the offering after deducting the net costs of its convertible note hedge and warrant transactions to repay in part the senior secured bank debt of VeriFone’s principal operating subsidiary, VeriFone, Inc.

This notice does not constitute an offer to sell or the solicitation of an offer to buy securities. Any offers of the securities will be made only by means of a private offering memorandum. The securities and the shares of VeriFone common stock issuable upon conversion or exercise of the securities have not been registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.


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