Global Payments Announces Pricing of Offering of $1.75 Billion of Convertible Senior Notes due 2031
Summary
The Company may redeem for cash all or part of the Convertible Notes, at its option, on or after March 6, 2028, if the last reported sale price of the Companys common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date.If the Company undergoes a fundamental change (as defined in the indenture governing the Convertible Notes), subject to certain conditions, holders may require the Company to repurchase for cash all or part of their Convertible Notes in principal amounts of $1,000 or an integral multiple thereof. The Company intends to use $222.25 million of the net proceeds from the offering to pay the cost of the capped call transactions. The Company intends to use the remainder of the net proceeds from the offering to repay borrowings and any accrued and unpaid interest under its commercial paper program, and also to repay borrowings and any accrued and unpaid interest under its revolving credit agreement, and any prepayment premium, penalty or other amount, if any, due in connection with any such repayment, and for general corporate purposes, including the repayment of other debt.The capped call transactions are expected generally to reduce potential dilution to the Companys common stock upon conversion of any Convertible Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Convertible Notes, as the case may be, with such reduction and/or offset subject to a cap.In connection with establishing their initial hedges of the capped call transactions, the Company expects the option counterparties or their respective affiliates to purchase shares of the Companys common stock and/or enter into various derivative transactions with respect to the Companys common stock concurrently with or shortly after the pricing of the Convertible Notes. This activity could increase (or reduce the size of any decrease in) the market price of the Companys common stock or the Convertible Notes at that time. In addition, the option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to the Companys common stock and/or purchasing or selling shares of the Companys common stock or other securities of the Company in secondary market transactions following the pricing of the Convertible Notes and prior to the maturity of the Convertible Notes (and are likely to do so on each exercise date for the capped call transactions or following any termination of any portion of the capped call transactions in connection with any repurchase, redemption or early conversion of the Convertible Notes).