BigBear.ai Announces Exchange of Convertible Notes

By Tamara Parker • Thursday, December 19 10:29 • Permanent Link

BigBear.ai Holdings, Inc. (NYSE: BBAI) has announced an exchange of a portion of its existing 6.00% convertible senior notes due 2026 for new 6.00% convertible senior secured notes due 2029. The exchange transactions involve approximately $182.3 million in aggregate principal amount of the existing convertible notes being exchanged for new convertible notes and approximately $0.4 million in cash, representing accrued and unpaid interest.

Upon completion of the exchange transactions, the aggregate principal amount of the existing convertible notes outstanding will be approximately $17.7 million. The new convertible notes will be fully and unconditionally guaranteed, on a senior, secured basis, by the company and certain existing and future direct and indirect subsidiaries, subject to certain exceptions.

The new convertible notes will accrue interest at a rate of 6.00% per annum if interest is paid in cash and 7.00% per annum if BigBear.ai elects, subject to certain conditions, to pay interest in kind with shares of its common stock, payable semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2025.

Additionally, holders who convert their new convertible notes will be entitled to an interest make-whole payment of up to 7.50% of the aggregate principal amount of notes converted, subject to reduction as further described in the indenture for the new convertible notes.

The new convertible notes will not be redeemable at BigBear.ai’s election before December 27, 2025. However, they will be redeemable, in whole but not in part, for cash at BigBear.ai’s option at any time on or after December 27, 2025, and prior to the close of business on November 16, 2029, under certain conditions.

In connection with the exchange transactions, BigBear.ai will obtain consents from certain holders of its existing convertible notes sufficient to amend certain terms of the indenture governing the existing convertible notes prior to or concurrently with the closing of the exchange transactions.

BigBear.ai is a leading provider of AI-powered decision intelligence solutions for national security, digital identity, and supply chain management. It is headquartered in Columbia, Maryland, and is a public company traded on the NYSE under the symbol BBAI. Today the company's shares have moved -4.7% to a price of $2.98. Check out the company's full 8-K submission here.

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