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Get filing alertsProPetro raises $690M via zero-coupon convertible notes, extends credit facility to 2031
Filed May 7, 2026 · Period ending May 4, 2026 · ~2 min read
Key Changes
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high
Issued $690M in 0% convertible senior notes due 2031, convertible at $23.17/share (37.5% premium to $16.85 closing price). Notes are senior unsecured but subordinated to subsidiary debt. Up to 40.9M shares could be issued upon conversion.
Item 1.01: Convertible debt verify on EDGAR → -
high
Amended credit facility to extend maturity to May 2031 and increase commitments to $350M (from prior level), with potential accordion expansion up to $150M. Amendment adds power generation equipment to borrowing base.
Item 1.01: Credit facility verify on EDGAR → -
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Purchased $36.8M in capped call hedges to reduce dilution from note conversions, with cap price at $29.49/share (75% premium). Dilution protection limited if stock rises above cap price.
Item 1.01: Capped calls verify on EDGAR → -
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Company can redeem notes at par starting May 2029 if stock trades at 130%+ of conversion price for 20 of 30 consecutive days. Noteholders can require repurchase at par upon fundamental change events.
Item 1.01: Redemption terms verify on EDGAR → -
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Notes sold privately to qualified institutional buyers under Rule 144A; conversion shares will be issued under Section 3(a)(9) exemption. No public registration required for either notes or conversion shares.
Item 3.02: Private placement verify on EDGAR →
Summary
ProPetro completed a major refinancing on May 7, 2026, raising $690 million through zero-coupon convertible notes while simultaneously extending and upsizing its credit facility. The convertible notes mature in 2031 and convert at $23.17 per share—a 37.5% premium to the recent $16.85 stock price—potentially adding up to 40.9 million shares if fully converted.
The company spent $36.8 million on capped call hedges to limit dilution, though protection caps out if the stock exceeds $29.49. The credit facility amendment extends maturity to 2031 and increases capacity to $350 million, providing additional liquidity headroom. For retail investors, this represents a significant capital structure shift that trades near-term dilution risk for long-term financial flexibility.
The zero-coupon structure means no cash interest payments, preserving liquidity, but the conversion feature could dilute existing shareholders by up to 40.9 million shares if the stock performs well. The 37.5% conversion premium provides some buffer, and the capped calls offer partial protection, but shareholders should monitor whether the stock approaches the $23.17 conversion threshold. Watch for: (1) how management deploys the $690M in proceeds—debt reduction, growth capex, or M&A will signal strategic priorities; (2) stock price movement relative to the $23.17 conversion price and $29.49 hedge cap; and (3) any future amendments to the credit facility that might indicate changing business conditions or covenant pressure.
Section-by-Section Diff
Event · Item 1.01 — Entry into a Material Definitive Agreement
Item 1.01 — Entry into a Material Definitive Agreement filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
The initial conversion rate is 43.1616 shares of Common Stock per $1,000 principal amount of Notes, which represents an initial conversion price of approximately $23.17 per share of Common Stock and a premium of approximately 37.5% over the last reported sale price of $16.85 per share of the Company’s Common Stock on the New York Stock Exchange on May 4, 2026.
Noteholders can convert at 43.1616 shares per $1,000 principal, equivalent to a $23.17 conversion price. Conversion is restricted before August 15, 2031 to certain circumstances, but unrestricted thereafter until maturity. The company can settle conversions in cash, stock, or a combination at its discretion.
Event · Item 2.03 — Creation of a Direct Financial Obligation
ProPetro created a direct financial obligation via an Indenture and amended its Credit Agreement.
Added in current filing · verify on EDGAR →
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information contained in Item 1.01 of this Current Report on Form 8-K relating to the Indenture under the heading “Indenture” and the Amendment under the heading “Amended and Restated Credit Agreement” is incorporated into this Item 2.03 by reference.
ProPetro disclosed the creation of a direct financial obligation under Item 2.03, referencing an Indenture and an Amended and Restated Credit Agreement detailed in Item 1.01. The filing does not provide the full text of these agreements in the excerpt provided, but indicates new debt or credit arrangements were established. This represents a material financing event that could affect the company's capital structure and leverage.
Event · Item 3.02 — Unregistered Sales of Equity Securities
Item 3.02 — Unregistered Sales of Equity Securities filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
The Notes were issued to the Initial Purchasers in reliance upon Section 4(a) (2) of the Securities Act of 1933, as amended (the “Securities Act”), in transactions not involving any public offering. The Notes were resold by the Initial Purchasers to persons whom the Initial Purchasers reasonably believe are qualified institutional buyers pursuant to Rule 144A under the Securities Act.
ProPetro completed a private placement of convertible notes to institutional buyers through initial purchasers. The notes were sold under exemptions from public offering registration requirements, first to the initial purchasers under Section 4(a)(2), then resold to qualified institutional buyers under Rule 144A.
Added in current filing · verify on EDGAR →
Initially, a maximum of 40,949,499 shares of the Company’s Common Stock may be issued upon conversion of the Notes, based on the initial maximum conversion rate of 59.3471 shares of Common Stock per $1,000 principal amount of Notes, which is subject to customary anti-dilution adjustment provisions.
The convertible notes can be converted into up to 40.9 million shares of common stock at an initial conversion rate of 59.3471 shares per $1,000 of note principal. This represents potential dilution to existing shareholders if the notes are converted, though the actual conversion rate may adjust based on anti-dilution provisions.
Added in current filing · verify on EDGAR →
Any shares of the Company’s Common Stock that may be issued upon conversion of the Notes will be issued in reliance upon Section 3(a) (9) of the Securities Act as involving an exchange by the Company exclusively with its security holders.
When noteholders convert their notes into common stock, ProPetro will issue those shares under Section 3(a)(9) of the Securities Act, which exempts exchanges with existing security holders from registration requirements. This means the conversion process won't require a separate SEC registration.
Event · Item 8.01 — Other Events
ProPetro priced and closed a private offering of notes to qualified institutional buyers on May 7, 2026.
Added in current filing · verify on EDGAR →
On May 4, 2026, the Company issued a press release announcing the pricing of the Notes.
ProPetro announced the pricing of notes on May 4, 2026, and the offering closed on May 7, 2026. The notes were sold to qualified institutional buyers in a private placement under Rule 144A, meaning they were not registered with the SEC and can only be traded among qualified institutional investors.
Added in current filing · verify on EDGAR →
On May 4, 2026, the Company entered into a purchase agreement (the “Purchase Agreement”) with Goldman Sachs & Co. LLC and Barclays Capital Inc., as representatives of the several initial purchasers named therein (the “Initial Purchasers”), in connection with the offering of the Notes (the “Notes Offering”).
ProPetro entered into a purchase agreement with Goldman Sachs and Barclays Capital as lead underwriters for the notes offering. The agreement contains standard representations, warranties, closing conditions, and indemnification provisions protecting the underwriters against certain liabilities including those under securities laws.
Added in current filing · verify on EDGAR →
The Notes were issued and sold to the Initial Purchasers pursuant to an exemption from the registration requirements of the Securities Act in reliance upon Section 4(a) (2) of the Securities Act. The Initial Purchasers resold the Notes only to persons reasonably believed to be qualified institutional buyers in accordance with Rule 144A under the Securities Act.
The notes were issued under a private placement exemption (Section 4(a)(2)) and resold only to qualified institutional buyers under Rule 144A. This means the notes are not registered with the SEC and have restricted transferability, limiting liquidity to institutional investors only.
Event · Item 9.01 — Financial Statements and Exhibits
ProPetro issued 0.00% convertible senior notes due 2031 and entered capped call transactions and credit agreement amendment.
Added in current filing · verify on EDGAR →
Indenture, dated as of May 7, 2026, between ProPetro Holding Corp. and U.S. Bank Trust Company, National Association, as trustee.
4.2
Form of 0.00% Convertible Senior Note due 2031 (included in Exhibit A to Exhibit 4.1).
ProPetro entered into an indenture on May 7, 2026 to issue 0.00% convertible senior notes due 2031. These are zero-coupon debt instruments that can convert into equity under specified conditions, providing the company with financing while potentially diluting shareholders if conversion occurs.
Added in current filing · verify on EDGAR →
Form of Capped Call Confirmation.
ProPetro entered into capped call transactions, which are derivative instruments typically used to reduce potential dilution from convertible note conversions by effectively raising the conversion price ceiling. This hedging strategy protects existing shareholders from dilution within a specified price range.
Added in current filing · verify on EDGAR →
Amendment No. 4 to Amended and Restated Credit Agreement, dated May 4, 2026.
ProPetro amended its existing credit agreement on May 4, 2026. While specific terms are not disclosed in the 8-K body, credit agreement amendments typically modify borrowing capacity, covenants, pricing, or other material terms of the company's revolving credit facility.
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Figures/quotes linked to EDGAR · Narrative written by AI · Jun 1, 2026 · How we verify