Share Buy Back - Convertable Notes discussion thread

- Open discussion, opinions on interpretation welcome -

I'm interested in an open and intelligent discussion regarding the start of the share buy back program commencing next Thursday 12th December.

I'd like to discuss as I want my information to be accurate and clear.

On the information at hand and my understanding there is as announced 150 million dollars to be spent on market buyback from next week being the 12th December onward up to a period of 12 months.

This primary purpose as I understand it is to offset a debt for equity convertable note swap of 250 million that was issued back in 2021 in order to prevent dilution.

(This debt had an option to be taken up as put options which lapsed hence it rolled into 2026. - "14March 2024 Webjet Limited (ASX:WEB) (Webjet) advises thatno investor has exercised their put option for repayment and cancellationunder the terms of the A$250 million convertible notes due 2026 (Notes)and accordingly, the full principal amount of the Notes remain outstanding and due for conversion or repayment on12 April 2026.")

The conversion (in absence of put option take up) is due 12 April 2026 and the conversion ratio if the debt is not paid in cash was in the initial arrangement "The Notes will have a coupon of 0.75% per annum, paid on a semi-annual basis. The Notes will be convertible into fully paid ordinary shares with an initial conversion price of AUD6.35 per ordinary share, which represents a conversion premium of 22.5% over the Reference Share Price (AUD5.18 per ordinary share) subject to adjustment in the manner set out in the terms and conditions of the Notes. The Notes have a maturity date of 12 April 2026."

Therefore if the 150 million on market is primarily to offset dilution it would I think be reasonable to conclude the buyback will be fairly aggressive with 12th April a key date to have this done by (although allowed themselves 12 months which is fine).

I have questions for the savvy in these things though -

"Webjet Limited Issue Size AUD 250m Term of Notes 5 years Conversion period Convertible at any time on or after the 41st day after the settlement date until 10 business days prior to the Final Maturity Date. Investor put option On or about 12 April 2024 (3 years) Final Maturity Date On or about 12 April 2026 (5 years) Coupon0.75% per annum, payable on a semi-annual basis. Conversion Premium 22.5% over the Reference Share Price, providing for a Conversion Price of AUD6.35 Reference Share Price AUD5.18, the clearing price of the Delta Placement Physical Settlement The Notes will be convertible into fully paid ordinary shares,calculated in accordance with the terms and conditions of the NotesConversion PriceStandard anti-dilutive adjustments including Conversion Price".

So most of this is clear except when the date comes around are the noteholders (in the absence of a cash payment) entitled to a conversion of debt to shares at the original 22.5% discount to market as per the marker pricing? Or does another mechanism kick in..

So as a hypothetical is this all about April 12ths price SP less 22.5% which covers interest over 5 years. I understand its a debt to equity swap, so nothing bad overall, though it's the dilution aspect I'm interested in.

I think if I am correct that the company will drive the price up buying on market up until the date as the lower the conversion the better it is for the company and holders.

Appreciate input from someone familiar with these swaps. It appears also there's another in 2027 so it's important to be aware.

Cheers.

(This post is for discussion and research, needs validation on data to be accurate).