Granite Construction Inc.
02/18/2026 | Press release | Distributed by Public on 02/18/2026 06:00
Material Agreement, Private Placement, Termination of Material Agreement (Form 8-K)
Item 1.01 Entry into a Material Definitive Agreement.
Exchange Agreements
On February 18, 2026 (the "Exchange Date"), Granite Construction Incorporated (the "Company") entered into separate and privately negotiated agreements (the "Exchange Agreements") with a limited number of holders of the Company's outstanding 3.75% Convertible Senior Notes due 2028 (the "3.75% Convertible Notes") pursuant to which the Company agreed to exchange $100 million aggregate principal amount of the 3.75% Convertible Notes for cash and stock (if any) consideration (such notes, the "Exchanged Notes," and each such transaction, a "Note Exchange Transaction"). The total consideration and the respective cash and stock (if any) portions of the consideration for the Note Exchange Transactions will be based, in part, on the per share volume-weighted average price of the Company's common stock during a 15 trading-day measurement period beginning on February 18, 2026 (the "Measurement Period"). Unless the average per share daily volume-weighted average price of the Company's common stock is greater than $140.00 over the Measurement Period, the entirety of the consideration for the Note Exchange Transactions will be paid in cash. If the average daily volume-weighted average price of the Company's common stock is greater than $140.00 over the Measurement Period, however, then a portion of the consideration owed in respect of the Exchanged Notes will be satisfied through the delivery of common stock of the Company. Assuming the per share volume-weighted average price of the Company's common stock during each day of the Measurement Period is $128.61, the closing price of the Company's common stock on February 17, 2026, the trading day immediately preceding the Exchange Date, the total purchase price would be approximately $283 million, inclusive of accrued and unpaid interest on the Exchanged Notes, and would be paid entirely in cash. The Note Exchange Transactions are subject to customary closing conditions. All Exchanged Notes will be canceled promptly following the closing of the Note Exchange Transactions. Following the closing of the Note Exchange Transactions, the Company is expected to have $273.75 million aggregate principal amount of 3.75% Convertible Notes outstanding, and the Note Exchange Transactions are expected to have the effect of removing approximately 2.2 million shares from the Company's diluted share count, which may be partially offset by any shares that will be issued as a portion of the consideration for the Note Exchange Transactions.
The foregoing description of the Exchange Agreements does not purport to be complete and is qualified in its entirety to the full text of the form of Exchange Agreement, a copy of which is filed with this Current Report on Form 8-K as Exhibit 10.1 and is incorporated herein by reference.
Unwind Agreements
In connection with the Note Exchange Transactions, on February 18, 2026, the Company entered into partial unwind agreements (the "Unwind Agreements") with certain financial institutions (the "Capped Call Counterparties") to unwind a portion of the capped call transactions that were entered into in connection with the offering of the 3.75% Convertible Notes. The Unwind Agreements relate to a number of call options corresponding to the number of Exchanged Notes. Pursuant to the Unwind Agreements, the Capped Call Counterparties will pay to the Company an amount of cash in respect of the capped call transactions being unwound thereunder, which amount will be determined based upon the volume-weighted average price per share of the Company's common stock during an averaging period beginning on February 18, 2026.
HudsonWest LLC, a full-service independent equity derivatives and convertible securities advisory firm, acted as financial advisor to the Company with respect to the Note Exchange Transactions and the Unwind Agreements.
Item 1.02 Termination of a Material Definitive Agreement.
The information set forth under Item 1.01 of this Current Report on Form 8-K with respect to the Unwind Agreements is incorporated herein by reference.
Item 3.02 Unregistered Sales of Equity Securities.
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
The Company will issue any common stock to the holders of the 3.75% Convertible Notes pursuant to the Note Exchange Transactions, if applicable, in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933. The Company relied on this exemption from registration based in part on representations made by the holders of the 3.75% Convertible Notes.
Granite Construction Inc. published this content on February 18, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on February 18, 2026 at 12:02 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]