Procore Technologies Issues $950M 0.00% Convertible Notes Due 2031

What Happened
Procore Technologies, Inc. announced completion of a private offering of $950,000,000 aggregate principal amount of 0.00% Convertible Senior Notes due 2031 on August 6, 2026 (including exercise of the purchasers’ option for an extra $125M). The Notes were issued under an indenture with U.S. Bank Trust Company, N.A. as trustee. Procore also entered into capped call transactions with financial institutions tied to the Notes to limit potential dilution and offset certain cash conversion payments.

Key Details

• Offering size: $950.0 million aggregate principal of 0.00% convertible senior notes due August 15, 2031 (Indenture dated Aug 6, 2026).
• Conversion terms: initial conversion rate 12.0642 shares per $1,000 principal (≈ $82.89 per share), ~50% premium to the $55.26 closing price on Aug 3, 2026; conversion restrictions apply until May 15, 2031 except in specified circumstances; unrestricted conversions allowed from May 15, 2031 until two trading days before maturity.
• Capped calls: entered Aug 3–4, 2026 to cover the shares underlying the Notes; initial cap price $110.52 per share (≈100% premium to $55.26) to limit dilution subject to adjustments.
• Proceeds and uses: net proceeds ≈ $926.6M; ~$59.1M paid for capped calls; ~$175M used to repurchase ~3.17M shares concurrently with pricing; remaining proceeds expected to fund part of the cash consideration for the pending acquisition of DroneDeploy, Inc. and for general corporate purposes.
• Redemption/repurchase features: Company may not redeem before Aug 20, 2029 (except cleanup redemption); optional cash redemption permitted on/after Aug 20, 2029 if stock trades ≥130% of conversion price for specified periods; cleanup redemption allowed if outstanding notes < $100M; holders can require repurchase on a “fundamental change” at 100% of principal plus any accrued special interest.
• Interest/default: Notes bear no regular interest (special interest may accrue in specific circumstances); Indenture includes customary covenants and events of default with certain limitations on remedies for reporting covenant breaches.

Why It Matters
This transaction raises substantial cash (~$926.6M net) to support Procore’s operations and part of the cash needed for the DroneDeploy acquisition, while also returning capital via a concurrent $175M buyback. The convertible structure means future conversion could dilute common shareholders, but the capped call transactions are intended to reduce that dilution up to a capped price. Investors should watch the company’s share price relative to the conversion triggers and the capped‑call cap, and monitor progress on the DroneDeploy deal and any future redemptions or conversions that could affect share count or cash needs.