Alarm.com $65 million greenshoe lifts convertibles to $500 million

By Cady Vishniac

Detroit, Jan. 20 – The exercise by initial purchasers of Alarm.com’s $65 million greenshoe brought its upsized $435 million of 0% convertibles to $500 million, according to an 8-K filing with the Securities and Exchange Commission.

The five-year convertible notes were issued after the market close on Jan. 15 at par with an initial conversion premium of 47.5%, according to a company news release.

J.P. Morgan Securities LLC and Barclays were joint bookrunners for the Rule 144A offering.

The initial size of the offering was $350 million with a greenshoe of $52.5 million.

The notes are non-callable until Jan. 20, 2024 and then subject to a 130% hurdle.

They are putable upon a fundamental change. There is dividend protection.

The notes will be settled in cash, shares or a combination of both at the company’s option.

Net proceeds are expected to $484.3 million.

Proceeds will be used by the company to repay outstanding borrowings and terminate its credit agreement and for general corporate purposes, which may include acquisitions or strategic investments.

Alarm.com is a Tysons, Va.-based security technology company.

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