TXNM Energy: Convertible Notes Now Convertible; Conversion Period Oct–Dec 2026

What Happened
TXNM Energy, Inc. announced that its 5.75% Junior Subordinated Convertible Notes due 2054 are convertible at the option of holders during a conversion window beginning October 1, 2026 and ending December 31, 2026. The conversion rate is 22.5654 shares of common stock per $1,000 principal (equivalent to a conversion price of approximately $44.32 per share). The company issued a conversion notice; details are available via DTC, Computershare (conversion agent), or on TXNM’s investor website.

Key Details

• Conversion period: October 1, 2026 through close of business December 31, 2026.
• Conversion mechanics: For the principal amount being converted, TXNM will deliver newly issued 5.75% non-convertible junior subordinated notes due 2054 (same terms as the convertible notes except no conversion feature). Any conversion obligation in excess of the principal amount converted will be satisfied with shares of common stock (and cash in lieu of fractional shares), with the excess determined using a 60-consecutive trading day observation period beginning the second trading day after the conversion date.
• Trigger: Convertibility was enabled because TXNM’s common stock met the trigger condition—last sale price ≥ 130% of the then-conversion price for at least 20 trading days during the 30-day period ending Sept 30, 2026.
• Merger note: TXNM is party to a merger agreement (with affiliates of Blackstone Infrastructure). If the merger closes, it would be a “make-whole fundamental change” allowing holders to convert for cash based on the merger price ($61.25 per share agreed in the merger agreement), subject to closing and other conditions.

Why It Matters
This filing gives convertible noteholders a three-month window to convert under current terms. However, holders converting during this window will largely exchange converted principal for a newly issued non-convertible subordinated note (less liquid and potentially less favorable than other securities) rather than receive cash or only shares for that portion. The filing also highlights a pending merger that, if completed, could change conversion economics (cash consideration at the merger price and expanded conversion rights). Retail investors should note the conversion price (~$44.32) versus the merger price ($61.25) and understand the differing liquidity and interest terms of the replacement non-convertible notes before deciding whether to convert.