Exhibit 99.1
May 24, 2022
InterDigital Announces Proposed Private Offering of $350 Million of Senior Convertible Notes
WILMINGTON, Del., May 24, 2022 (GLOBE NEWSWIRE) — InterDigital, Inc. (“InterDigital”) (Nasdaq:IDCC) announced that it intends to offer, subject to market and other conditions, $350 million aggregate principal amount of Senior Convertible Notes due 2027 in a private offering. The notes will be offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Act”). InterDigital also expects to grant to the initial purchasers of the notes a 13-day option to purchase up to an additional $52.5 million aggregate principal amount of notes.
The notes will pay interest semi-annually in cash on June 1 and December 1 and will mature on June 1, 2027. Prior to March 1, 2027, the notes will be convertible only upon the occurrence of certain events and during certain periods, and thereafter, at any time until the second scheduled trading day preceding the maturity date. Upon conversion of the notes, InterDigital will pay cash up to the aggregate principal amount of the notes to be converted, and will pay or deliver, as the case may be, cash, shares of InterDigital’s common stock or a combination thereof, at InterDigital’s election, for any conversion obligation in excess of the aggregate principal amount being converted. The notes are expected to be redeemable by InterDigital on or after June 5, 2025 if certain conditions are satisfied.
InterDigital expects to use a portion of the net proceeds from the offering of the notes, and the proceeds from the sale of the warrants described below, to fund the cost of the convertible note hedge transactions described below. The remaining net proceeds from the offering of the notes are expected to be used for the repurchase of a portion of InterDigital’s existing 2.00% senior convertible notes due 2024 (the “2024 notes”) in privately negotiated transactions concurrently with the offering of the notes, the repurchase of up to $100 million of shares of InterDigital common stock from institutional investors consistent with its recently announced $100 million increase to its authorized repurchase program through one of the initial purchasers or its affiliate, as InterDigital’s agent, concurrently with the pricing of the offering of the notes, and for general corporate purposes, which may include, among other things, the repurchase, redemption or other retirement of any remaining 2024 notes.
In connection with the pricing of the notes, InterDigital expects to enter into one or more privately negotiated convertible note hedge transactions with certain financial institutions, which may include one or more of the initial purchasers of the notes or their affiliates (the “hedge counterparties”). The convertible note hedge transactions collectively are expected to cover, subject to customary anti-dilution adjustments, the aggregate number of shares of InterDigital common stock that will initially underlie the notes. InterDigital also expects to enter into one or more privately negotiated warrant transactions with the hedge counterparties whereby InterDigital will sell to the hedge counterparties warrants relating to the same number of shares of InterDigital common stock, with such number of shares subject to customary anti-dilution adjustments. In addition, if the initial purchasers exercise their option to purchase additional notes, InterDigital expects to enter into one or more additional warrant transactions and to use a portion of the proceeds from the sale of the additional notes and warrant transactions to enter into additional convertible note hedge transactions. The convertible note hedge transactions are expected to reduce the potential dilution with respect to InterDigital common stock and/or offset any potential cash payments InterDigital is required to make in excess of the principal amount of converted notes, as the case may be, upon any conversion of the notes in the event that the market price per share of InterDigital common stock exceeds the strike price of the convertible note hedge transactions. However, the warrant transactions will have a dilutive effect to the extent that the market price per share of InterDigital common stock exceeds the applicable strike price of the warrants on any expiration date of the warrants.
