| Item 1.01 |
Entry into a Material Definitive Agreement |
Convertible Note Offering
On November 12, 2026, Akamai Technologies, Inc. (“Akamai”) completed its previously announced offering of 1.00% Convertible Senior Notes due November 15, 2028 (the “2028 Notes”) and 1.00% Convertible Senior Notes due November 15, 2031 (the “2031 Notes” and, together with the 2028 Notes, the “Notes”). The Notes were sold in a private placement under a purchase agreement, dated as of November 9, 2026, entered into by and between Akamai and each of Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, BofA Securities, Inc., Citigroup Global Markets Inc. and Morgan Stanley & Co. LLC, as representatives of the several initial purchasers named therein (collectively, the “Initial Purchasers”), for resale to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).
The aggregate principal amount of the 2028 Notes sold in the offering was $1.25 billion, which includes $150.0 million in aggregate principal amount of 2028 Notes issued pursuant to the Initial Purchasers’ option to purchase 2028 Notes on the same terms and conditions, which the Initial Purchasers exercised in full on November 10, 2026, and the aggregate principal amount of the 2031 Notes sold in the offering was $1.25 billion, which includes $150.0 million in aggregate principal amount of 2031 Notes issued pursuant to the Initial Purchasers’ option to purchase 2031 Notes on the same terms and conditions, which the Initial Purchasers exercised in full on November 10, 2026.
Akamai used approximately $284.4 million of the net proceeds from the offering of the Notes to pay the cost of the privately-negotiated convertible note hedge transactions described below (after such cost was partially offset by the proceeds to Akamai from the sale of warrants pursuant to the warrant transactions described below).
Akamai intends to use the remaining net proceeds from the offering of the Notes to repay at maturity a portion of Akamai’s $1.15 billion outstanding aggregate principal amount of 0.375% Convertible Senior Notes due 2027 (the “2027 Convertible Notes”), which mature on September 1, 2027, and/or to pay cash amounts due upon any earlier conversion of the 2027 Convertible Notes, and to fund the capital expenditure requirements of its Cloud Infrastructure Services (CIS) business. In addition, Akamai intends to use any remaining net proceeds for general corporate purposes.
Indentures and the Notes
On November 12, 2026, Akamai entered into an indenture (the “2028 Notes Indenture”) with respect to the 2028 Notes with U.S. Bank Trust Company, National Association, as trustee (the “Trustee”) and an indenture (the “2031 Notes Indenture” and, together with the 2028 Notes Indenture, the “Indentures”) with respect to the 2031 Notes with the Trustee. Under the Indentures, the Notes will be senior unsecured obligations of Akamai. The Notes will bear interest at a rate of 1.00% per year, payable semiannually in arrears on May 15 and November 15 of each year, beginning on May 15, 2027. The 2028 Notes will mature on November 15, 2028 and the 2031 Notes will mature on November 15, 2031, in each case, unless earlier redeemed, converted or repurchased in accordance with their terms.
The 2028 Notes are convertible into shares of Akamai’s common stock at an initial conversion rate of 8.8963 shares per $1,000 principal amount of 2028 Notes (equivalent to an initial conversion price of approximately $112.41 per share of common stock) and the 2031 Notes are convertible into shares of Akamai’s common stock at an initial conversion rate of 9.7685 shares per $1,000 principal amount of 2031 Notes (equivalent to an initial conversion price of approximately $102.37 per share of common stock). The conversion rates will be subject to adjustment in some events. The initial conversion price of the 2028 Notes represents a premium of approximately 40.0% and the initial conversion price of the 2031 Notes represents a premium of approximately 27.5% to the $80.29 per share closing price of Akamai’s common stock on November 9, 2026.
Upon conversion of the Notes, Akamai will pay cash up to the aggregate principal amount of the Notes to be converted and pay or deliver, as the case may be, cash, shares of Akamai’s common stock, or a combination of cash and shares of Akamai’s common stock, at Akamai’s election, in respect of the remainder, if any, of Akamai’s conversion obligation in excess of the aggregate principal amount of the Notes being converted.
Prior to the close of business on the business day immediately preceding August 15, 2028, the 2028 Notes will be convertible only upon the occurrence of certain events and will be convertible thereafter at any time prior to the
