Page 5 of 7 – SEC Filing Item 5. Interest in Securities of the Issuer
(a)-(b) Corvex may be deemed to be the beneficial owner of 11,423,142 Shares and 7,643,800 Shares underlying the call options referenced below in this Item 5, which collectively represent approximately 8.3% of the Issuer’s outstanding Shares. By virtue of his position as control person of the general partner of Corvex, Mr. Meister may be considered to beneficially own such Shares. The Reporting Persons may be deemed to have sole power to vote and sole power to dispose of 19,066,942 Shares. The percentage calculated in the immediately foregoing paragraph is calculated based on a total of 231,041,580 Shares outstanding as of July 22, 2016, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the SEC on July 26, 2016. The call options referenced above are over-the-counter market American-style call options referencing an aggregate of 7,643,800 Shares, which have an exercise price of $6.80 per Share and expire on March 31, 2017. On June 24, 2016, Corvex exercised previously reported over-the-counter market American-style call options referencing an aggregate of 1,500,000 Shares (the “Option Exercise”). In connection with the above referenced call options, Corvex has sold in the over-the-counter market European-style put options referencing an aggregate of 7,643,800 Shares at an exercise price of $6.80 per Share, which expire on the earlier of March 31, 2017, or the date on which the corresponding American-style call option described above in this Item 5 is exercised. As a result of the Option Exercise described above in this Item 5, previously reported over-the-counter market European-style put options sold by Corvex referencing an aggregate of 1,500,000 Shares expired. The Reporting Persons’ advised Corvex Funds have entered into cash-settled swaps which represent economic exposure comparable to a notional interest in 3,695,715 Shares (representing economic exposure comparable to approximately 1.6% of the outstanding Shares). Under the terms of the swaps, (i) the relevant Corvex entity will be obligated to pay to the counterparty any negative price performance of the specified notional number of Shares subject to the swaps as of the expiration date of such swaps, plus interest rates set forth in the applicable contracts, and (ii) the counterparty will be obligated to pay the relevant Corvex entity any positive price performance of the specified notional number of Shares subject to the swaps as of the expiration date of the swaps. All balances will be settled in cash. The swaps do not give the Reporting Persons or Corvex Funds direct or indirect voting, investment or dispositive control over any securities of the Issuer and do not require the counterparty thereto to acquire, hold, vote or dispose of any securities of the Issuer. Accordingly, the Reporting Persons disclaim any beneficial ownership of any Shares that may be referenced in the swap contracts or Shares or other securities or financial instruments that may be held from time to time by any counterparty to the contracts. The Reporting Persons may be deemed to beneficially own $15,000,000 principal amount of the Issuer’s 1.75% Convertible Senior Note due 2020, which is convertible into Shares at a conversion ratio of 60.905 Shares per $1,000 principal amount (the “Convertible Note”). The Reporting Persons cannot currently convert the Convertible Note into Shares as its convertibility is subject to certain material contingencies outside the control of the Reporting Persons, and the Issuer has the option in its sole discretion to settle a conversion of the Convertible Note in cash rather than Shares, and as a result the Reporting Persons do not consider the Shares underlying the Convertible Note as being beneficially owned by them. (c) The disclosure regarding the Option Exercise described above in this Item 5 is incorporated herein by reference. Except as set forth herein, there have been no transactions in the Shares during the sixty days prior to the date hereof by any of the Reporting Persons. Follow Pandora Media Llc (NYSE:P)
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| Item 5. | Interest in Securities of the Issuer |
(a)-(b) Corvex may be deemed to be the beneficial owner of 11,423,142 Shares and 7,643,800 Shares underlying the call options referenced below in this Item 5, which collectively represent approximately 8.3% of the Issuer’s outstanding Shares. By virtue of his position as control person of the general partner of Corvex, Mr. Meister may be considered to beneficially own such Shares. The Reporting Persons may be deemed to have sole power to vote and sole power to dispose of 19,066,942 Shares.
The percentage calculated in the immediately foregoing paragraph is calculated based on a total of 231,041,580 Shares outstanding as of July 22, 2016, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the SEC on July 26, 2016.
The call options referenced above are over-the-counter market American-style call options referencing an aggregate of 7,643,800 Shares, which have an exercise price of $6.80 per Share and expire on March 31, 2017. On June 24, 2016, Corvex exercised previously reported over-the-counter market American-style call options referencing an aggregate of 1,500,000 Shares (the “Option Exercise”).
In connection with the above referenced call options, Corvex has sold in the over-the-counter market European-style put options referencing an aggregate of 7,643,800 Shares at an exercise price of $6.80 per Share, which expire on the earlier of March 31, 2017, or the date on which the corresponding American-style call option described above in this Item 5 is exercised. As a result of the Option Exercise described above in this Item 5, previously reported over-the-counter market European-style put options sold by Corvex referencing an aggregate of 1,500,000 Shares expired.
The Reporting Persons’ advised Corvex Funds have entered into cash-settled swaps which represent economic exposure comparable to a notional interest in 3,695,715 Shares (representing economic exposure comparable to approximately 1.6% of the outstanding Shares). Under the terms of the swaps, (i) the relevant Corvex entity will be obligated to pay to the counterparty any negative price performance of the specified notional number of Shares subject to the swaps as of the expiration date of such swaps, plus interest rates set forth in the applicable contracts, and (ii) the counterparty will be obligated to pay the relevant Corvex entity any positive price performance of the specified notional number of Shares subject to the swaps as of the expiration date of the swaps. All balances will be settled in cash. The swaps do not give the Reporting Persons or Corvex Funds direct or indirect voting, investment or dispositive control over any securities of the Issuer and do not require the counterparty thereto to acquire, hold, vote or dispose of any securities of the Issuer. Accordingly, the Reporting Persons disclaim any beneficial ownership of any Shares that may be referenced in the swap contracts or Shares or other securities or financial instruments that may be held from time to time by any counterparty to the contracts.
The Reporting Persons may be deemed to beneficially own $15,000,000 principal amount of the Issuer’s 1.75% Convertible Senior Note due 2020, which is convertible into Shares at a conversion ratio of 60.905 Shares per $1,000 principal amount (the “Convertible Note”). The Reporting Persons cannot currently convert the Convertible Note into Shares as its convertibility is subject to certain material contingencies outside the control of the Reporting Persons, and the Issuer has the option in its sole discretion to settle a conversion of the Convertible Note in cash rather than Shares, and as a result the Reporting Persons do not consider the Shares underlying the Convertible Note as being beneficially owned by them.
(c) The disclosure regarding the Option Exercise described above in this Item 5 is incorporated herein by reference. Except as set forth herein, there have been no transactions in the Shares during the sixty days prior to the date hereof by any of the Reporting Persons.
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