Citrix Systems, Inc. (NASDAQ:CTXS) announced its intention to offer $1.25 billion principal amount of convertible senior notes due 2019 (the “notes”), subject to market and other conditions, in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Citrix also expects to grant the initial purchasers of the notes a 30-day option to purchase up to an additional $187.5 million principal amount of the notes, solely to cover over-allotments. In connection with the pricing of the notes, Citrix expects to enter into privately negotiated convertible note hedge transactions with one or more financial institutions, which may include one or more of the initial purchasers or their respective affiliates (the “option counterparties”). The convertible note hedge transactions are expected to reduce potential dilution to Citrix’s common stock upon conversion of the notes and/or offset any cash payments due upon conversion of the notes in excess of the principal amount of the notes in the event that the market price per share of Citrix’s common stock, as measured under the terms of the convertible note hedge transactions, is greater than the strike price of the convertible note hedge transactions (which is expected to initially correspond to the initial conversion price of the notes and to be subject to certain adjustments substantially similar to those contained in the notes). In addition, in order to partially offset the cost of the convertible note hedge transactions, Citrix expects to issue warrants to the option counterparties at a strike price higher than that of the convertible note hedge transactions. The warrants would separately have a dilutive effect to the extent that the market price per share of Citrix’s common stock exceeds the applicable strike price of the warrants unless, subject to certain conditions, Citrix elects to settle the warrants in cash.