Progress Software Announces Upsize and Pricing of Convertible Senior Notes Offering

BURLINGTON, Mass., Feb. 27, 2024 (GLOBE NEWSWIRE) -- Progress Software Corporation (NASDAQ: PRGS) (“Progress”) today announced the pricing of its private offering of $400.0 million aggregate principal amount of 3.50% Convertible Senior Notes due 2030 (the “Notes”) to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Progress also granted the initial purchasers of the Notes an option to purchase up to an additional $50.0 million aggregate principal amount of the Notes, for settlement within a 13-day period beginning on, and including, the first date on which the Notes are issued, solely to cover overallotments. The aggregate principal amount of the offering was increased from the previously announced offering size of $350.0 million (or $402.5 million if the initial purchasers exercise their option to purchase additional notes in full). The offering of the Notes is expected to close on March 1, 2024, subject to customary closing conditions.

The Notes will be Progress’ senior unsecured obligations and will mature on March 1, 2030, unless earlier converted, redeemed or repurchased. The Notes will bear interest at a rate of 3.50% per year, payable semi-annually in arrears on March 1 and September 1, of each year, beginning on September 1, 2024. Before November 1, 2029, Noteholders will have the right to convert their Notes only upon the occurrence of certain events. From and after November 1, 2029, Noteholders may convert their Notes at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date. Progress will satisfy its conversion obligations by paying cash up to the aggregate principal amount of Notes to be converted and pay or deliver, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at its election, in respect of the remainder. The initial conversion rate is 14.7622 shares of common stock per $1,000 principal amount of Notes, which represents an initial conversion price of approximately $67.74 per share of common stock. The initial conversion price represents a premium of approximately 27.50% over the last reported sale price of $53.13 per share of Progress’ common stock on February 27, 2024. The conversion rate and conversion price will be subject to adjustment upon the occurrence of certain events. In addition, upon certain corporate events or upon a notice of redemption (as described below), Progress will, under certain circumstances, increase the conversion rate for Noteholders who convert Notes in connection with such a corporate event or notice of redemption.