Granite Construction Inc. Unwinds Capped Calls Ahead of 2028 Note Redemption

What Happened Granite Construction Incorporated (GVA) announced it has entered into unwind agreements on August 4, 2026 with certain financial institutions to unwind and terminate the capped call transactions that were originally entered in connection with the issuance of its 3.75% Convertible Senior Notes due 2028. The Company had previously called for redemption of the outstanding $273.7 million principal amount of those 2028 Notes on May 19, 2026.

Key Details

• The Unwind Agreements require the capped call counterparties to pay Granite a cash amount based on the volume-weighted average price (VWAP) per share during a five-day averaging period beginning August 4, 2026.
• Settlement and payment under the Unwind Agreements are expected on or about August 11, 2026.
• Granite expects to use the cash proceeds from the unwind, together with cash on hand, to settle conversions of the 2028 Notes on August 12, 2026.
• Item 1.02 of the filing notes the termination of the material capped call agreements as described above.

Why It Matters This action unwinds hedges tied to the company’s convertible debt as part of Granite’s plan to redeem and settle its $273.7M of 2028 convertible notes. For investors, the unwind may affect the company’s cash flows around the mid-August settlement dates and removes the previously outstanding capped-call instruments that offset potential equity dilution from conversions. The filing provides clear timing and the mechanism (VWAP-based cash settlement) for how the unwind and subsequent note conversions will be funded.