| Type | Sym | Class | Transaction | Value $ | Shares | Change % | * Price $ | Shares After | Date | Ownership | Footnotes |
|---|---|---|---|---|---|---|---|---|---|---|---|
| transaction | CHWY | Class A common stock, par value $0.01 | Other | -11.5M | -65.17% | 6.12M | May 15, 2023 | See footnotes | F1, F2, F3, F4, F5, F6, F7, F8 | ||
| transaction | CHWY | Class A common stock, par value $0.01 | Other | -6.12M | -100% | 0 | May 16, 2023 | See footnotes | F1, F2, F3, F4, F5, F6, F7, F8 |
| Type | Sym | Class | Transaction | Value $ | Shares | Change % | * Price $ | Shares After | Date | Underlying Class | Amount | Exercise Price | Ownership | Footnotes |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| transaction | CHWY | Forward purchase contract (obligation to sell) | Other | $0 | -11.5M | -65.17% | $0.00 | 6.12M | May 15, 2023 | Class A common stock, par value $0.01 | 11.5M | See footnotes | F1, F2, F3, F4, F5, F6, F7, F8 | |
| transaction | CHWY | Forward purchase contract (obligation to sell) | Other | $0 | -6.12M | -100% | $0.00* | 0 | May 16, 2023 | Class A common stock, par value $0.01 | 6.12M | See footnotes | F1, F2, F3, F4, F5, F6, F7, F8 |
| Id | Content |
|---|---|
| F1 | On each of May 15, 2023 and May 16, 2023, Buddy Chester Sub LLC ("Buddy Sub") settled a prepaid variable forward sale contract (the "Contract") that was entered into on May 11, 2020 with the 2020 Mandatory Exchangeable Trust (the "Trust"), a Delaware statutory trust. The Contract obligated Buddy Sub to deliver up to 17,584,098 shares of Class A common stock, par value $0.01 per share of the Issuer (or, at Buddy Sub's election, an equivalent amount of cash based on the market price of the Issuer's Class A common stock on or about May 16, 2023 (the "Exchange Date")). Pursuant to the Contract, if the number of shares of Class A common stock to be delivered exceeds 9.9% of the Issuer's then outstanding shares of Class A common stock, such excess portion is to be delivered on the following business day. |
| F2 | (Continued from footnote 1) Delivery on any business day of a number of shares of Class A common stock may not exceed 9.9% of the then outstanding shares of Class A common stock. Buddy Sub received a cash payment of $535,222,699.50 from the Trust on the date it entered into the Contract. Buddy Sub pledged 17,584,098 shares of the Issuer's Class A common stock (the "Pledged Shares") to secure its obligations under the Contract and Buddy Sub retained all voting rights with respect to the Pledged Shares. On May 11, 2020, the Trust issued 690,000 mandatory exchangeable trust securities (the "Trust Securities"). |
| F3 | Pursuant to the Contract, the Trust agreed to exchange each Trust Security for a pro rata portion of the Issuer's Class A common stock or other property it received from Buddy Sub under the Contract. The number of shares of the Issuer's Class A common stock delivered to the Trust under the Contract was equal to the number of Trust Securities outstanding multiplied by a conversion rate, which would be between 21.2368 and 25.4842 and would be determined by reference to the volume-weighted average trading price (the "Daily VWAP") of the Issuer's Class A common stock during the 20-trading day observation period beginning on, and including, the 24th scheduled trading day immediately preceding the Exchange Date (the "Observation Period"). |
| F4 | Pursuant to the Contract, the conversion rate would be the sum of the following amounts determined for each of the trading days during the Observation Period: (a) if the Daily VWAP was equal to or greater than the Threshold Appreciation Price (as defined below), an amount equal to 21.2368 divided by 20; (b) if the Daily VWAP was equal to or less than the Threshold Appreciation Price but greater than or equal to the Initial Price (as defined below), an amount that if multiplied by the Daily VWAP for such trading day would have a value equal to $50; and (c) if the Daily VWAP was equal to or less than the Initial Price, an amount equal to 25.4842 divided by 20. The Initial Price, which was the last reported sale price per share of the Issuer's Class A common stock on the New York Stock Exchange as of May 4, 2020, is $39.24 (the "Initial Price"). The Threshold Appreciation Price, which is approximately 120% of the Initial Price, is $47.09 (the "Threshold Appreciation Price"). |
| F5 | The conversion rate was determined to be 25.4842. Accordingly, 11,459,956 of the Pledged Shares were transferred to the Trust on May 15, 2023 and the remaining 6,124,142 of the Pledged Shares were transferred to the Trust on May 16, 2023. |
| F6 | Argos Holdings GP LLC ("GP LLC") is the general partner of Argos Holdings L.P. ("Argos"). Argos is the sole common equity holder of Citrus Intermediate Holdings L.P. ("Citrus"). GP LLC is the general partner of Citrus. Citrus is the sole stockholder of Argos Intermediate Holdco I Inc. ("Holdco I"). Holdco I is the sole member of Buddy Sub, Buddy Holdings III LLC and Argos Intermediate Holdco II LLC ("Holdco II"). Holdco II is the sole member of Argos Intermediate Holdco III LLC ("Holdco III"). Holdco III is the sole member of Buddy Holdings II LLC. |
| F7 | (continued from footnote 5) CIE Management IX Limited controls a majority of the equity interests of GP LLC and has the power to appoint members to the board of directors of GP LLC who may exercise majority voting power at meetings of the board of directors of GP LLC. BC Partners Holdings Limited is the controlling shareholder of CIE Management IX Limited. |
| F8 | The reported securities are held directly by Buddy Sub. Each Reporting Person may be deemed to be the beneficial owner of all or a portion of the securities reported herein. The filing of this statement shall not be deemed to be an admission that, for purposes of Section 16 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise, the Reporting Persons are the beneficial owners of any securities reported herein. The Reporting Persons disclaim beneficial ownership of such securities except to the extent of their pecuniary interest therein. On the basis of the relationship between each of Mr. Raymond Svider, Mr. Fahim Ahmed, Mr. Michael Chang and other directors of the Issuer designated or nominated by the Reporting Persons, the Reporting Persons may be directors of the Issuer by deputization for the purposes of Section 16 of the Exchange Act. |
Because no more than 10 reporting persons can file any one Form 4 through the Securities and Exchange Commission's EDGAR system, Argos Holdings L.P., Citrus Intermediate Holdings L.P., Argos Intermediate Holdco I Inc., Argos Intermediate Holdco II LLC., Argos Intermediate Holdco III LLC, Buddy Holdings III LLC and Buddy Holdings II LLC have filed a separate Form 4.