SMART Global Holdings Announces Pricing of Upsized Private Offering of $175.0 Million Convertible Notes

SMART Global Holdings, Inc. (“SGH,” “we” or the “Company”) (Nasdaq: SGH) today announced the pricing of $175.0 million in aggregate principal amount of convertible senior notes due 2030 (the “Notes”) to be offered and sold to qualified institutional buyers as defined in Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The aggregate principal amount of the offering was increased from the previously announced offering size of $150.0 million. The Company has granted the initial purchasers of the Notes an option to purchase, for settlement within a period of 13 days from, and including, the date the Notes are first issued, up to an additional $25.0 million aggregate principal amount of Notes. The offering is expected to close on or about August 6, 2024, subject to customary closing conditions.

The Notes will be senior, unsecured obligations of the Company and will accrue interest at a rate of 2.00% per year, payable semi-annually in arrears on February 15 and August 15 of each year, beginning on February 15, 2025. The Notes will mature on August 15, 2030, unless earlier converted, redeemed or repurchased. Prior to February 15, 2030, the Notes will be convertible at the option of the holders only upon satisfaction of certain conditions and during certain periods. On or after February 15, 2030, the Notes will be convertible at the option of the holders at any time prior to the close of business on the second scheduled trading day immediately before the maturity date. The Company will settle conversions by paying or delivering, as applicable, cash and, if applicable, ordinary shares, based on the applicable conversion rate(s). The initial conversion rate of the Notes is 35.7034 ordinary shares per $1,000 principal amount of Notes (which is equivalent to an initial conversion price of approximately $28.01 per share and represents a conversion premium of approximately 30% above the closing price of the Company’s ordinary shares on August 1, 2024, which was $21.545 per share). The conversion rate is subject to adjustment upon the occurrence of certain events.

The Notes will be redeemable, in whole or in part, for cash at SGH’s option at any time, and from time to time, on or after August 20, 2027 and on or before the 31st scheduled trading day immediately before the maturity date, but only if the last reported sale price per ordinary share of the Company exceeds 130% of the conversion price for a specified period of time. In addition, the Notes will be redeemable, in whole and not in part, at SGH’s option at any time in connection with certain changes in tax law. The redemption price will be equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.