Exhibit 99.1
Press Release
Verint Announces Upsize and Pricing of Offering of Convertible Senior Notes
MELVILLE, N.Y., April 6, 2021 – Verint® Systems Inc. (NASDAQ: VRNT) today announced that it has agreed to sell $275 million aggregate principal amount of its 0.25% convertible senior notes due 2026 (or up to $315 million in aggregate principal amount if the initial purchasers exercise their option to purchase additional notes in full) in a private placement to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933. The aggregate principal amount of the offering was increased from the previously announced offering size of $250 million (or $287.5 million if the initial purchasers exercise their option to purchase additional notes in full).
The notes will bear interest at a rate of 0.25% per year, payable semi-annually in arrears, and will mature on April 15, 2026, unless repurchased or converted in accordance with their terms prior to that date. Upon conversion of the notes, Verint will pay cash up to the aggregate principal amount of notes to be converted and pay and/or deliver, as the case may be, cash, shares of Verint’s common stock or a combination of cash and shares of Verint’s common stock, at Verint’s election, in respect of the remainder, if any. Upon conversion, Verint currently intends to deliver shares of Verint’s common stock in respect of the remainder. The initial conversion rate of the notes will be 16.1092 shares per $1,000 principal amount of notes, which is equal to a conversion price of approximately $62.08 per share, subject to adjustment in certain circumstances. The initial conversion price represents a premium of approximately 32.5% to the $46.85 per share closing price of Verint’s common stock on the Nasdaq Global Select Market on April 6, 2021.
Verint estimates the aggregate net proceeds from the offering to be approximately $267 million (assuming no exercise of the initial purchasers’ option), after deducting the initial purchaser discount and estimated offering expenses payable by Verint. Verint intends to use a portion of the net proceeds from the offering to pay the costs of the capped call transactions described below. Verint intends to use the remainder of the net proceeds from the notes offering, together with the net proceeds from the issuance of $200.0 million of its Series B convertible preferred stock to an affiliate of Apax Partners that closed today, to repay a portion of the outstanding indebtedness under its existing credit facility, to repay certain amounts owing under interest rate swap agreements and to repurchase approximately 1.06 million shares of its common stock, and the remainder is expected to be used for working capital and other general corporate purposes. The closing of the offering is expected to occur on April 9, 2021, subject to the satisfaction of customary closing conditions.
In connection with the pricing of the notes, Verint entered into capped call transactions with certain of the initial purchasers and/or their respective affiliates and/or other financial institutions (the “option counterparties”). The capped call transactions are expected generally to reduce potential dilution to Verint’s common stock upon any conversion of the notes at maturity and/or offset any cash payments Verint is required to make in excess of the principal amount of converted notes, as the case may be, with such reduction and/or offset subject to a cap based on the cap price. The cap price of the capped call transactions will initially be $100.00 per share, which represents a premium of approximately 113% over the last reported sale price of Verint’s common stock of $46.85 per share on April 6, 2021, and is subject to certain adjustments under the terms of the capped call transactions. If the initial purchasers exercise their option to purchase additional notes, Verint expects to enter into additional capped call transactions with the option counterparties.
Verint has been advised that, 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 Verint’s common stock and/or purchase shares of Verint’s common stock concurrently with, or shortly after, the pricing of the notes, and may unwind these various derivative transactions and purchase Verint’s common stock in open market transactions shortly following the pricing of the notes. These activities could increase (or reduce the size of any decrease in) the market price of Verint’s common stock or the notes at that time.
In addition, Verint has been advised that the option counterparties and/or their respective affiliates may modify their hedge positions by entering into or unwinding various derivative transactions referencing Verint’s common stock and/or purchasing or selling shares of Verint’s common stock or other securities of Verint in secondary market
