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  4. [8-K] PEABODY ENERGY CORP Reports Material Event

Peabody (NYSE: BTU) sells $250M 0.50% convertible notes due 2031

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(Very High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Peabody Energy Corporation completed a private offering of $250 million aggregate principal amount of 0.50% Convertible Senior Notes due 2031, generating approximately $243.3 million in net proceeds. The notes are senior unsecured, pay 0.50% interest semi-annually, and mature on June 1, 2031 unless earlier repurchased, redeemed, or converted.

Peabody plans to use about $16.7 million of the proceeds for capped call transactions and, together with available cash, to repurchase approximately $241.2 million of its outstanding 3.250% Convertible Senior Notes due 2028 for a total cash purchase price of about $388.8 million. The initial conversion rate is 26.0970 shares per $1,000, implying an initial conversion price of about $38.32 per share, a 32.5% premium to the $28.9197 reference stock price.

The notes are convertible only upon specified stock-price, trading-price, corporate-event, redemption, or near-maturity conditions, with settlement in cash, stock, or a combination at Peabody’s election. The company may redeem the notes, subject to trading and price hurdles, beginning in 2029, and noteholders receive a 100% cash repurchase right upon certain fundamental changes. Related capped call transactions initially cap economic exposure at $50.6095 per share, a 75.0% premium to the reference price.

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Insights

Peabody refinances 2028 converts with lower-coupon 2031 notes and adds capped calls.

Peabody issued $250 million of 0.50% Convertible Senior Notes due 2031, with net proceeds of about $243.3 million. It plans to repurchase roughly $241.2 million of outstanding 3.250% Convertible Senior Notes due 2028, effectively extending its convertible debt maturity profile.

This transaction lowers the stated coupon from 3.250% to 0.50% and pushes the final maturity out by three years, while preserving flexibility to settle conversions in cash, stock, or both. The initial conversion price of about $38.32 per share reflects a 32.5% premium to the $28.9197 reference stock price, which limits near-term dilution unless the share price rises materially.

Capped call transactions, funded with approximately $16.7 million, raise the effective economic conversion cap to $50.6095 per share, a 75.0% premium to the reference price. These are designed to reduce potential dilution or excess cash outlay on conversions prior to May 30, 2030. Overall impact on leverage and equity dilution will depend on future stock performance and holder conversion behavior.

Item 1.01 Entry into a Material Definitive Agreement Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Financial
The company incurred a new significant debt or off-balance-sheet obligation.
Item 3.02 Unregistered Sales of Equity Securities Securities
The company sold equity securities in a private placement or other unregistered transaction.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
New convertible notes size $250 million aggregate principal amount 0.50% Convertible Senior Notes due 2031
Net proceeds $243.3 million Net of discounts, commissions and expenses
Legacy notes repurchased $241.2 million 3.250% Convertible Senior Notes due 2028
Cash purchase price for 2028 notes $388.8 million Total cash to repurchase 2028 convertible notes
Coupon rate 0.50% per year Interest on 2031 convertible notes, paid semi-annually
Initial conversion rate 26.0970 shares per $1,000 Implied conversion into Peabody common stock
Initial conversion price $38.32 per share (approx.) 32.5% premium to $28.9197 reference price
Capped call cap price $50.6095 per share 75.0% premium to $28.9197 reference stock price
Convertible Senior Notes financial
"0.50% Convertible Senior Notes due 2031 (the “Initial Notes”)."
Convertible senior notes are a type of loan that a company issues to investors, which can be turned into company shares later on. They are called "senior" because they are paid back before other debts if the company runs into trouble. This allows investors to earn interest like a loan but also have the chance to own part of the company if its value rises.
Indenture regulatory
"the Company entered into an Indenture, dated June 2, 2026"
An indenture is a legal agreement between a company that borrows money by issuing bonds and the people who buy those bonds. It explains the rules the company must follow, like paying back the money and keeping certain financial promises. This document helps both sides understand their rights and responsibilities.
Capped Call Transactions financial
"the Company entered into privately negotiated capped call transactions (the “Capped Call Transactions”)"
Capped call transactions are agreements where investors buy options that give them the chance to benefit if a stock's price goes up, but with a limit on how much they can gain. This helps protect them from paying too much if the stock's price rises a lot, similar to having a maximum limit on a reward. They matter because they help investors manage risk while still allowing some upside potential.
fundamental change regulatory
"If the Company undergoes a fundamental change (as defined in the Indenture)"
A fundamental change is a major shift in how a company or economy operates, like a new technology or a big change in leadership. It matters because such changes can affect the value or stability of investments, making them more or less attractive. Think of it like a major upgrade or shift in the rules of a game that can change the outcome.
Rule 144A regulatory
"pursuant to the exemption from registration provided by Rule 144A under the Securities Act"
Rule 144A is a regulation that makes it easier for companies to sell private bonds to large investors without going through all the usual rules that apply to public sales. It matters because it helps companies raise money more quickly and privately, often attracting big investors looking for special deals.
Section 4(a)(2) regulatory
"in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act"
Section 4(a)(2) is a part of U.S. securities laws that allows companies to sell their stock directly to certain investors without registering the sale with regulators. This process is often used for private placements, making it easier and faster for companies to raise money from knowledgeable or institutional investors. It matters to investors because it provides an alternative way to buy shares, often with fewer disclosures and lower costs.

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FAQ

What type of financing did Peabody Energy (BTU) complete in this 8-K?
Peabody completed a private offering of $250 million aggregate principal amount of 0.50% Convertible Senior Notes due 2031. The notes are senior unsecured obligations and pay interest semi-annually until maturity on June 1, 2031, unless earlier repurchased, redeemed, or converted.

How will Peabody Energy (BTU) use the net proceeds from the 0.50% convertible notes?
Peabody received approximately $243.3 million in net proceeds and intends to use about $16.7 million to enter capped call transactions. Together with available cash, it plans to repurchase approximately $241.2 million of its 3.250% Convertible Senior Notes due 2028 for about $388.8 million in cash.

What are the key conversion terms of Peabody Energy’s 0.50% Convertible Senior Notes due 2031?
The initial conversion rate is 26.0970 shares per $1,000 principal amount, implying an initial conversion price of about $38.32 per share. This represents a 32.5% premium to the $28.9197 reference stock price, with conversion allowed only upon specified price, trading, event, redemption, or near-maturity conditions.

When can Peabody Energy (BTU) redeem the new convertible notes, and at what price?
Peabody may not redeem the notes before June 5, 2029, except for a cleanup redemption. From June 5, 2029, it may redeem them at 100% of principal plus accrued interest, subject to trading and stock-price tests and minimum outstanding principal conditions described in the Indenture.

What are the capped call transactions Peabody Energy entered into with this offering?
Peabody entered into capped call transactions expected to reduce potential dilution or excess cash payments on conversions before May 30, 2030. The initial cap price is $50.6095 per share, a 75.0% premium to the $28.9197 reference price, and is subject to adjustment under the confirmations.

Are Peabody Energy’s new convertible notes and underlying shares registered under the Securities Act?
No. The notes were sold in a private placement relying on Section 4(a)(2) and Rule 144A exemptions. Neither the notes nor the shares issuable upon conversion are registered under the Securities Act and cannot be offered or sold in the United States without registration or an applicable exemption.
PEABODY ENERGY CORP false 0001064728 0001064728 2026-05-28 2026-05-28
 
 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): May 28, 2026

 

 

PEABODY ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   1-16463   13-4004153
(State or other jurisdiction
of incorporation)		   (Commission
File Number)		   (IRS Employer
Identification No.)

 

701 Market Street, St. Louis, Missouri   63101-1826
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (314) 342-3400

N/A

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

  

Trading
Symbol(s)

  

Name of each exchange
on which registered 

Common Stock, par value $0.01 per share   BTU   New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 
 

Item 1.01

Entry into a Material Definitive Agreement.

Convertible Notes and the Indenture

On May 28, 2026, Peabody Energy Corporation (the “Company” or “Peabody”) priced its private offering of $225 million in aggregate principal amount of 0.50% Convertible Senior Notes due 2031 (the “Initial Notes”). On May 29, 2026, the initial purchasers in such offering exercised their option (the “Notes Option”) to purchase an additional $25 million in aggregate principal amount of the Notes (together with the “Initial Notes,” the “Notes”), bringing the total aggregate principal amount of the Notes to $250 million. On June 2, 2026, the Company completed the private offering of the Notes. The Notes are senior unsecured obligations of the Company.

The net proceeds from this offering were approximately $243.3 million, after deducting the initial purchasers’ discounts and commissions and the estimated offering expenses payable by the Company. The Company intends to use approximately $16.7 million of the net proceeds from the offering of the Notes to fund the cost of entering into Capped Call Transactions (as defined below) and, together with available cash, to repurchase approximately $241.2 million aggregate principal amount of Peabody’s outstanding 3.250% Convertible Senior Notes due 2028 (the “2028 Notes”) for a total cash purchase price of approximately $388.8 million.

In connection with the issuance of the Notes, the Company entered into an Indenture, dated June 2, 2026 (the “Indenture”), with Wilmington Trust, National Association, as trustee. The Indenture includes customary covenants and sets forth certain events of default after which the Notes may be declared immediately due and payable and sets forth certain types of bankruptcy or insolvency events of default involving the Company after which the Notes become automatically due and payable.

The Notes will mature on June 1, 2031, unless earlier repurchased, redeemed or converted in accordance with their terms. The Notes will bear interest from June 2, 2026 at a rate of 0.50% per year payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2026.

The Notes will be convertible at the option of the holders only in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on September 30, 2026, if the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading day period (such five consecutive trading day period, the “Measurement Period”) in which the trading price per $1,000 principal amount of Notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price per share of the Company’s common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on the Company’s common stock; (4) if the Company calls such Notes for redemption; and (5) at any time from, and including, December 1, 2030 until the close of business on the second scheduled trading day immediately before the maturity date.

Upon conversion, the Company may satisfy its conversion obligation by paying or delivering, as applicable, cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election, in the manner and subject to the terms and conditions provided in the Indenture. The initial conversion rate for the Notes will be 26.0970 shares of the Company’s common stock per $1,000 principal amount of Notes, which represents an initial conversion price of approximately $38.32 per share of the Company’s common stock. The initial conversion price represents a premium of approximately 32.5% over the U.S. composite volume weighted average price of Peabody’s common stock from 9:30 a.m. through 4:00 p.m. Eastern Daylight Time on May 28, 2026, which was $28.9197 per share. The conversion rate and conversion price are subject to adjustment under certain circumstances in accordance with the terms of the Indenture. If certain corporate events described in the Indenture occur prior to the maturity date, or the Company delivers a redemption notice (as described below), the conversion rate will be increased for a holder who elects to convert its Notes in connection with such corporate event or redemption notice, as the case may be, in certain circumstances.

The Company may not redeem the Notes prior to June 5, 2029, except in the event of a cleanup redemption (as defined below). The Company may redeem the Notes in whole or in part (subject to certain limitations), at its option at any time, and from time to time, on or after June 5, 2029 and on or before the 31st scheduled trading day immediately before the maturity date, at a cash redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, if (i) the notes are

 

“freely tradable” (as defined in the Indenture), and all accrued and unpaid additional interest, if any, has been paid in full, as of the date the Company sends the related redemption notice; and (ii) the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price on (1) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (2) the trading day immediately before the date the Company sends such notice. However, the Company may not redeem less than all of the outstanding Notes unless at least $75 million aggregate principal amount of Notes are outstanding and not called for redemption as of the time the Company sends the related redemption notice. No sinking fund is provided for the Notes.

Peabody may redeem for cash all, but not less than all, of the Notes at any time if (i) the Notes are “freely tradable” (as defined in the Indenture), and all accrued and unpaid additional interest, if any, has been paid in full, as of the date Peabody sends the related redemption notice; and (ii) the amount of the Notes that remains outstanding is less than 15% of the aggregate principal amount of the Notes initially issued under the Indenture at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date (a “cleanup redemption”).

If the Company undergoes a fundamental change (as defined in the Indenture), noteholders may require the Company to repurchase their Notes at a cash repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date.

The description of the Indenture contained herein is qualified in its entirety by reference to the text of the Indenture filed as Exhibit 4.1 to this Current Report on Form 8-K, which is incorporated herein by reference.

Capped Call Transactions

On May 28, 2026, in connection with the offering of the Notes, and on May 29, 2026, in connection with the initial purchasers’ exercise of the Notes Option, the Company entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with certain of the initial purchasers or their affiliates and certain other financial institutions (the “Option Counterparties”) pursuant to capped call confirmations in substantially the form filed as Exhibit 10.1 to this Current Report on Form 8-K. The Capped Call Transactions are expected generally to reduce the potential dilution to the Company’s common stock upon any conversion of the Notes prior to May 30, 2030, and/or offset any potential cash payments the Company is required to make in excess of the principal amount of such converted Notes, as the case may be, with such reduction and/or offset subject to a cap based on the cap price. The cap price of the Capped Call Transactions will initially be $50.6095 per share, which represents a premium of approximately 75.0% over the U.S. composite volume weighted average price of the Company’s common stock from 9:30 a.m. through 4:00 p.m. Eastern Daylight Time on May 28, 2026 (which was $28.9197 per share), and is subject to certain adjustments under the terms of the Capped Call Transactions. The Capped Call Transactions will expire over a period of trading days beginning on April 17, 2030.

The description of the Capped Call Transactions contained herein is qualified in its entirety by reference to the text of the form of capped call confirmation relating to the Capped Call Transactions filed as Exhibit 10.1 to this Current Report on Form 8-K, which is incorporated herein by reference.

 

Item 2.03

Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated by reference in this Item 2.03.

 

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 by reference in this Item 3.02.

Convertible Notes

The Company offered and sold the Notes to the initial purchasers in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and for initial resale by the initial purchasers to persons reasonably believed to be qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A under the Securities Act. The Company relied on these exemptions based in part on representations made by the initial purchasers in the purchase agreement pursuant to which the Company sold the Notes to the initial purchasers. Neither the Notes nor the shares of the Company’s common stock issuable upon conversion of the Notes, if any, have been registered under the Securities Act and these securities may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

 

Item 9.01.

Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit

 No. 

   

Description of Exhibit

 4.1    Indenture, dated as of June 2, 2026, between Peabody Energy Corporation and Wilmington Trust, National Association, as trustee.
 4.2    Form of 0.50% Convertible Senior Notes due 2031 (included in Exhibit 4.1).
10.1    Form of Capped Call Confirmation
104    Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    PEABODY ENERGY CORPORATION
June 2, 2026     By:  

/s/ Scott T. Jarboe

        Name:   Scott T. Jarboe
        Title:   Chief Administrative Officer and Corporate Secretary

Source: View Original Filing on SEC EDGAR

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