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OFFON

AFFIRM HOLDINGS, INC.

(AFRM)
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AFFIRM HOLDINGS, INC. : Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant, Unregistered Sale of Equity Securities, Financial Statements and Exhibits (form 8-K)

11/23/2021 | 12:26pm EST

Item 1.01. Entry into a Material Definitive Agreement.




Indenture and Notes


On November 23, 2021, Affirm Holdings, Inc. (the "Company") sold to Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC, as representatives (the "Representatives") of the several initial purchasers (the "Initial Purchasers"), and the Initial Purchasers purchased from the Company, $1.725 billion aggregate principal amount of the Company's 0% Convertible Senior Notes due 2026 (the "Notes"), pursuant to a purchase agreement (the "Purchase Agreement") between the Company and the Representatives. The $1.725 billion aggregate principal amount of Notes included the exercise in full of the option granted by the Company to the Initial Purchasers to purchase up to an additional $225 million aggregate principal amount of the Notes.

The Notes were offered in a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"), to the initial purchasers for initial resale to persons reasonably believed to be qualified institutional buyers pursuant to an exemption from registration provided by Rule 144A promulgated under the Securities Act. The offer and sale of the Notes and the Class A common stock of the Company (the "Class A common stock") issuable upon conversion, if any, 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 such registration requirements. The issuance of Class A common stock upon conversion, if any, is expected to be exempt from registration pursuant to Section 3(a)(9) of the Securities Act. This Current Report on Form 8-K does not constitute an offer to sell nor the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

In connection with the issuance of the Notes, the Company entered into an Indenture, dated November 23, 2021 (the "Indenture"), between the Company and Wilmington Trust, National Association, as trustee (the "Trustee"). The terms of the Notes are governed by the Indenture. The Notes will not bear regular interest. The Notes mature on November 15, 2026, unless earlier repurchased, redeemed or converted in accordance with their terms prior to such date.

The Notes are general senior unsecured obligations of the Company, ranking senior in right of payment to any future debt that is expressly subordinated in right of payment to the Notes and equally in right of payment with all of the Company's existing and future liabilities that are not so subordinated. The Notes will be effectively subordinated to all of the Company's existing and future secured debt to the extent of the value of the assets securing such debt. The Notes will be structurally subordinated to all of the existing and future liabilities and obligations of the Company's subsidiaries.

Holders may convert their Notes under the following conditions at any time prior to the close of business on the business day immediately preceding August 15, 2026 in multiples of $1,000 principal amount, only under the following circumstances:

· during any calendar quarter commencing after the calendar quarter ending on

   March 31, 2022 (and only during such calendar quarter), if the last reported
   sale price of the Class A common stock for at least 20 trading days (whether or
   not consecutive) during the period of 30 consecutive trading days ending on,
   and including, the last trading day of the immediately preceding calendar
   quarter is greater than or equal to 130% of the conversion price on each
   applicable trading day;



· during the five business day period after any five consecutive trading day

   period in which the trading price per $1,000 principal amount of the Notes for
   each trading day of that five consecutive trading day period was less than 98%
   of the product of the last reported sale price of the Class A common stock and
   the conversion rate on each such trading day;










· if the Company calls any or all of the Notes for redemption, at any time prior

   to the close of business on the scheduled trading day immediately preceding the
   redemption date; or



· upon the occurrence of specified corporate events as described in the

   Indenture.



In addition, holders may convert their Notes, in multiples of $1,000 principal amount, at their option at any time beginning on or after August 15, 2026, and prior to the close of business on the second scheduled trading day immediately preceding the maturity date of the Notes, without regard to the foregoing circumstances. The initial conversion rate for the Notes is 4.6371 shares of Class A common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $215.65 per share of Class A common stock, subject to adjustment upon the occurrence of certain specified events as set forth in the Indenture. Upon conversion, the Company will pay cash up to the aggregate principal amount of the Notes to be converted and pay or deliver, as the case may be, cash, shares of Class A common stock or a combination of cash and shares of Class A common stock, at its election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the notes being converted. The Indenture provides for certain events upon which the conversion rate will be increased, but in no event will the conversion rate per $1,000 principal amount of notes exceed 7.1875 shares of Class A common stock, subject to adjustments as provided in the Indenture.

The events of default, as set forth in the Indenture, include customary events including a default in the payment of principal or interest, failure to comply with the obligation to deliver amounts due upon conversion, failure to give certain notices, failure to comply with obligations in respect of certain merger transactions, defaults under certain other indebtedness and certain events of bankruptcy and insolvency.

The foregoing description of the Indenture and the Notes does not purport to be complete and is qualified in its entirety by reference to the full text of the Indenture and the form of Notes, which are attached as Exhibit 4.1 and Exhibit 4.2, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an

            Off-Balance Sheet Arrangement of a Registrant.



The information set forth in Item 1.01 above is incorporated by reference into this Item 2.03.

Item 3.02 Unregistered Sales of Equity Securities.

The information set forth in Item 1.01 above is incorporated by reference into this Item 3.02.

Item 9.01. Financial Statements and Exhibits.




(d) Exhibits.



Exhibit No. Description
  4.1         Indenture, dated November 23, 2021, between the Company and
            Wilmington Trust, National Association, as trustee
  4.2         Form of 0% Convertible Senior Note due 2026 (included in
            Exhibit 4.1)
104         Cover Page Interactive Data File - the cover page XBRL tags are
            embedded within the Inline XBRL document.

© Edgar Online, source Glimpses

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Financials (USD)
Sales 2022 1 272 M - -
Net income 2022 -658 M - -
Net Debt 2022 969 M - -
P/E ratio 2022 -29,9x
Yield 2022 -
Capitalization 18 035 M 18 035 M -
EV / Sales 2022 14,9x
EV / Sales 2023 10,8x
Nbr of Employees 1 876
Free-Float -
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Mean consensus OUTPERFORM
Number of Analysts 13
Last Close Price 64,18 $
Average target price 146,77 $
Spread / Average Target 129%
EPS Revisions
Managers and Directors
Max R. Levchin Chairman & Chief Executive Officer
Michael Linford Chief Financial Officer & Secretary
Libor Michalek Director & President-Technology
Jeremy Liew Independent Director
Christa Sober Quarles Independent Director
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