PagerDuty Announces Proposed Private Placement of $350 Million of Convertible Senior Notes

PagerDuty, a global leader in digital operations management, has announced its plans to offer $350 million in Convertible Senior Notes due 2028 in a private placement. The company also intends to grant the initial purchasers of the notes an option to purchase up to an additional $52.5 million principal amount of notes.

The notes will be senior unsecured obligations of PagerDuty and will accrue interest payable semiannually in arrears. Upon conversion, PagerDuty will pay cash up to the aggregate principal amount of the notes to be converted and pay or deliver a combination of cash and shares of PagerDuty’s common stock, at PagerDuty’s election, in respect of the remainder of PagerDuty’s conversion obligation.

PagerDuty plans to use a portion of the net proceeds from the offering to pay the cost of capped call transactions and to repurchase certain of its 1.25% Convertible Senior Notes due 2025 and shares of PagerDuty’s common stock. The remainder of the net proceeds will be used for working capital or other general corporate purposes, including potential acquisitions and strategic transactions.

The company also expects to enter into privately negotiated capped call transactions to offset potential dilution to PagerDuty’s common stock resulting from the conversion of the notes. These capped call transactions will cover the number of shares of PagerDuty’s common stock that will initially underlie the notes.

PagerDuty’s offering of the notes and the shares of PagerDuty’s common stock issuable upon conversion of the notes have not been registered under the Securities Act or any state securities laws. This offering is not contingent upon the repurchase of the 2025 notes.

PagerDuty is a leading player in digital operations management, providing the PagerDuty Operations Cloud that powers the agility driving digital transformation. Customers rely on PagerDuty’s solutions to compress costs, accelerate productivity, win revenue, sustain seamless digital experiences, and earn customer trust.

Forward-looking statements in this press release highlight the proposed terms of the notes and capped call transactions, the completion, timing, and size of the offering, and the anticipated use of proceeds. PagerDuty cautions that these forward-looking statements are subject to risks and uncertainties, and actual results may differ materially from those stated or implied.

PagerDuty’s announcement of the offering reflects the company’s commitment to capitalizing on growth opportunities and further strengthening its position in the digital operations management space. With its innovative solutions and customer-centric approach, PagerDuty continues to drive digital transformation and help businesses thrive in the digital age.

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