In connection with the pricing of the notes, Volcano expects to enter into convertible note hedge transactions with one or more of the underwriters and/or their respective affiliates (the "option counterparties"), which are expected to reduce the potential dilution with respect to Volcano's common stock upon conversions of the notes. Volcano also expects to enter into warrant transactions with the option counterparties, which could have a dilutive effect on Volcano's common stock to the extent that the market value per share of Volcano's common stock, as measured under the warrant transactions, exceeds the strike price of the warrant transactions. If the underwriters exercise their over-allotment option to purchase additional notes, Volcano expects to enter into additional convertible note hedge transactions and additional warrant transactions.Volcano has been advised that, in connection with establishing their initial hedge positions with respect to the convertible note hedge transactions and the warrant transactions, the option counterparties, and/or their affiliates, expect to enter into various over-the-counter derivative transactions with respect to Volcano's common stock concurrently with and/or shortly after the pricing of the notes. These activities could have the effect of increasing, or limiting a decline in, the market price of Volcano's common stock concurrently with and/or shortly after the pricing of the notes.
Volcano Corporation To Offer $350 Million Convertible Senior Notes Due 2017
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