LinkedIn 2011 Annual Report Download - page 88

Download and view the complete annual report

Please find page 88 of the 2011 LinkedIn annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 112

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112

12. Redeemable Convertible Preferred Stock and Stockholders’ Equity
Initial Public Offering
In May 2011, the Company closed its IPO of 9,016,000 shares of its Class A common stock, which included
6,003,804 shares of Class A common stock sold by the Company (inclusive of 1,176,000 shares of Class A
common stock from the full exercise of the overallotment option of shares granted to the underwriters) and
3,012,196 shares of Class A common stock sold by the selling stockholders. The public offering price of the
shares sold in the offering was $45.00 per share. The Company did not receive any proceeds from the sales of
shares by the selling stockholders. The total gross proceeds from the offering to the Company were $270.2
million. After deducting underwriting discounts and commissions and offering expenses payable by the
Company, the aggregate net proceeds received by the Company totaled approximately $248.4 million.
Follow-on Offering
In November 2011, the Company closed its follow-on offering of 10,062,500 shares of its Class A common
stock, which included 2,583,755 shares of Class A common stock sold by the Company (inclusive of 1,312,500
shares of Class A common stock from the full exercise of the overallotment option of shares granted to the
underwriters) and 7,478,745 shares of Class A common stock sold by the selling stockholders. The public
offering price of the shares sold in the offering was $71.00 per share. The Company did not receive any proceeds
from the sales of shares by the selling stockholders. The total gross proceeds from the offering to the Company
were $178.1 million. After deducting underwriting discounts and commissions and offering expenses payable by
the Company, the aggregate net proceeds received by the Company totaled approximately $177.3 million.
Preferred Stock
Prior to its IPO, the Company had outstanding 17,238,579 shares designated as Series A convertible
preferred stock, 17,450,991 shares designated as Series B convertible preferred stock, 4,357,644 designated as
Series C redeemable convertible preferred stock and 6,599,987 designated as Series D redeemable convertible
preferred stock. Each share of preferred stock was convertible into one share of common stock. Immediately
prior to the completion of the Company’s IPO on May 19, 2011, all shares of outstanding preferred stock
automatically converted into 45,647,201 shares of the Company’s Class B common stock.
Warrant
In connection with the line of credit agreement, on September 20, 2004, the Company issued a warrant to
purchase 70,365 shares of Series A convertible preferred stock with an exercise price of $0.32 per share. The fair
value of the warrant, based on an option valuation model, which approximates a binomial lattice model, was
insignificant and was reflected as a discount to borrowings under the financing. The warrant was exercisable for
seven years from the date of issuance. In May 2010, the warrant was exercised. As a result, the Company issued
70,365 shares of Series A convertible preferred stock and received an insignificant amount of proceeds.
Common Stock
At December 31, 2010, there were 120,000,000 shares of common stock authorized, and 43,308,742 shares
issued and outstanding. Following its IPO on May 19, 2011, the Company had two classes of authorized common
stock outstanding; Class A common stock and Class B common stock. As of December 31, 2011, there were
40,637,575 shares and 60,842,819 shares of Class A common stock and Class B common stock, respectively,
issued and outstanding.
-84-