| Convertible Notes |
9. Convertible Notes The Company has the following convertible notes outstanding as of March 31, 2026: | · | $75,000 in aggregate principal amount of the 2026 Notes; | | · | $70,000 in aggregate principal amount of the 2029 Notes; | | · | $475,000 in aggregate principal amount of 4.625% Convertible Senior Notes due 2030 (the “2030 Notes”); and | | · | $603,750 in aggregate principal amount of 4.50% Convertible Senior Notes due 2031 (the “2031 Notes”). | Each class of notes was issued pursuant to indentures dated as of the issuance dates between the Company and U.S. Bank Trust Company, National Association, as trustee (either initially or as successor to U.S. Bank National Association, the “Trustee”), in private offerings to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. In connection with the issuance of the 2031 Notes, the Company exchanged $75,000 in aggregate principal amount of the 2026 Notes for 6,807,374 shares of common stock and $275,000 in aggregate principal amount of the 2029 Notes for $302,675 in cash and 4,192,620 shares of common stock. As a result of these transactions, during the three months ended March 31, 2026, the Company recognized a loss totaling $62,302, comprised of a $16,922 loss on extinguishment associated with the repurchase of the 2026 Notes and a $45,380 inducement expense related to the repurchase of the 2029 Notes, which was accounted for as an induced conversion. As of March 31, 2026, the Company had an aggregate principal amount of $1,223,750 outstanding of the 2026 Notes, the 2029 Notes, the 2030 Notes and the 2031 Notes (collectively, the “Convertible Notes”). Key terms of the Convertible Notes are as follows: | | | 2026 Notes | | 2029 Notes | | 2030 Notes | | 2031 Notes | | Principal outstanding | | $ | 75,000 | | $ | 70,000 | | $ | 475,000 | | $ | 603,750 | | Issuance date | | | June 14, 2021 | | | August 13, 2024 | | | August 14, 2025 | | | March 30, 2026 | | Maturity date (unless earlier converted, repurchased or redeemed) | | | June 15, 2026 | | | August 15, 2029 | | | August 15, 2030 | | | October 1, 2031 | | Interest rate | | | 3.25% | | | 3.25% | | | 4.625% | | | 4.50% | | Initial conversion price | | $ | 11.04 | | $ | 11.82 | | $ | 19.15 | | $ | 21.58 | | Initial conversion rate | | | 90.5797 | | | 84.5934 | | | 52.2071 | | | 46.3306 | | Redemption price | | $ | 14.35 | | $ | 15.37 | | $ | 24.90 | | $ | 28.06 | | · | Interest payment dates: Payable semiannually in arrears on June 15 and December 15 of each year for the 2026 Notes, on February 15 and August 15 of each year for the 2029 Notes and the 2030 Notes and on April 1 and October 1 of each year for the 2031 Notes. |
| · | Conversion price: Convertible at an initial conversion rate into shares of the Company’s common stock, per $1,000 principal amount of notes (equivalent to an initial conversion price set forth in the table above), subject to adjustment. | | · | Conversion: Holders may convert at their option at any time prior to the close of business on the business day immediately preceding March 15, 2026, May 15, 2029, May 15, 2030 and July 1, 2031 for the 2026 Notes, the 2029 Notes, the 2030 Notes and the 2031 Notes, respectively, only under the following circumstances: (i) if the last reported sale price of the Company’s common stock for at least 20 trading days during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price for the respective Convertible Notes on each applicable trading day; (ii) during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of the Convertible Notes for each trading day of the measurement period was less than 98% of the product of the last reported sales price of the Company’s common stock and the conversion rate on each such trading day; (iii) upon a notice of redemption delivered by the Company in accordance with the terms of the indentures but only with respect to the Convertible Notes called (or deemed called) for redemption; or (iv) upon the occurrence of specified corporate events. On or after March 15, 2026, May 15, 2029, May 15, 2030 and July 1, 2031 in respect of the 2026 Notes, the 2029 Notes, the 2030 Notes and the 2031 Notes, respectively, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Convertible Notes at any time, regardless of the foregoing circumstances. | | · | Cash settlement of principal amount: Upon conversion, the Company will pay cash up to the aggregate principal amount of the Convertible Notes to be converted. At its election, the Company will also settle the conversion obligation in excess of the aggregate principal amount of the Convertible Notes being converted in either cash, shares of its common stock or a combination of cash and shares of its common stock. |
| · | Redemption dates: The Company may redeem for cash all or any portion of the Convertible Notes, at its option, on or after June 20, 2023, August 20, 2026, August 20, 2027 and April 6, 2028 in respect of the 2026 Notes, the 2029 Notes, the 2030 Notes and the 2031 Notes, respectively, and on or prior to the 55th scheduled trading day with respect to the 2026 Notes and the 2029 Notes and the 45th scheduled trading day with respect to the 2030 Notes and the 2031 Notes immediately preceding the maturity date, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price for the respective Convertible Notes then in effect for at least 20 trading days, including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day 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 notes to be redeemed, plus accrued and unpaid interest to, but excluding the redemption date. No sinking fund is provided for the Convertible Notes. | | · | Limited investor put rights: Holders of the Convertible Notes have the right to require the Company to repurchase for cash all or a portion of their notes at 100% of their principal amount, plus any accrued and unpaid interest, upon the occurrence of certain change of control transactions or liquidation, dissolution or common stock delisting events. | | · | Conversion rate increase in certain customary circumstances: In certain circumstances, conversions in connection with a “make-whole fundamental change” (as defined in the indentures) or conversions of Convertible Notes called (or deemed called) for redemption may result in an increase to the conversion rate, provided that the conversion rate will not exceed 144.9275 shares, 103.6269 shares, 75.7003 shares and 74.1282 shares of the Company’s common stock per $1,000 principal amount of the 2026 Notes, the 2029 Notes, the 2030 Notes and the 2031 Notes, respectively (the equivalent of 98,835,989 shares of the Company’s common stock based on the aggregate principal amount of Convertible Notes outstanding), subject to adjustment. | | · | Seniority and Security: The Convertible Notes rank equal in right of payment and are the Company’s senior unsecured obligations. |
The indentures contain customary terms and covenants, including that upon certain events of default occurring and continuing, either the Trustee or the respective holders of not less than 25% in aggregate principal amount of the respective series of Convertible Notes outstanding may declare the entire principal amount of all such respective Convertible Notes to be repurchased, plus any accrued special interest, if any, to be immediately due and payable. The following table provides a summary of the Convertible Notes at March 31, 2026 and December 31, 2025: | | | March 31, 2026 | | December 31, 2025 | | | | 2026
Notes | | 2029
Notes | | 2030
Notes | | 2031
Notes | | Total | | 2026
Notes | | 2029
Notes | | 2030
Notes | | Total | | Principal amount | | $ | 75,000 | | | $ | 70,000 | | | $ | 475,000 | | | $ | 603,750 | | | $ | 1,223,750 | | | $ | 150,000 | | | $ | 345,000 | | | $ | 475,000 | | | $ | 970,000 | | | Less: Unamortized issuance costs | | | (90 | ) | | | (1,052 | ) | | | (9,684 | ) | | | (12,580 | ) | | | (23,406 | ) | | | (396 | ) | | | (5,566 | ) | | | (10,231 | ) | | | (16,193 | ) | | Carrying amount | | $ | 74,910 | | | $ | 68,948 | | | $ | 465,316 | | | $ | 591,170 | | | $ | 1,200,344 | | | $ | 149,604 | | | $ | 339,434 | | | $ | 464,769 | | | $ | 953,807 | | | Effective interest rate(1) | | | 3.83% | | | | 3.70% | | | | 5.10% | | | | 4.88% | | | | 4.83% | | | | 3.83% | | | | 3.70% | | | | 5.10% | | | | 4.40% | | _____________________________ | (1) | Includes amortization of the issuance costs and premium. | Interest expense on the Convertible Notes during the three months ended March 31, 2026 and 2025 was $10,788 and $4,986, respectively. Interest payable of $3,998 and $12,813 at March 31, 2026 and December 31, 2025, respectively, is included in accounts payable and other liabilities on the Consolidated Balance Sheets. The fair value of the Convertible Notes (classified as Level 2 in the fair value hierarchy) at March 31, 2026 and December 31, 2025 was $1,336,215 and $1,082,570, respectively. At March 31, 2026, the if-converted value of the 2026 Notes and the 2029 Notes was $98,913 and $86,227, respectively, and the if-converted value of the 2030 Notes and the 2031 Notes did not exceed the principal amount. At December 31, 2025, the if-converted value of the 2026 Notes and the 2029 Notes was $165,625 and $355,799, respectively, and the if-converted value of the 2030 Notes did not exceed the principal amount. |