Oracle Corporation 8-K

Summary

Oracle completed a $5.0B mandatory convertible preferred stock offering through 100M depositary shares. The 6.50% preferred stock carries dividend, liquidation and conversion rights and restricts common-stock dividends and certain share repurchases while dividends on the preferred remain unpaid.

Key Figures

• Offering: 100M depositary shares, each representing 1/2,000th of a preferred share; each preferred share has a $100,000 liquidation preference, or $5.0B in aggregate. The filing does not state offering proceeds.
• Dividends: 6.50% annually on the liquidation preference, payable quarterly when declared, beginning 4/15/2026 and ending 1/15/2029. Dividends may be paid in cash, common shares, or a combination.
• Conversion: Unless converted earlier, each depositary share automatically converts into 0.2499–0.3124 common shares after the final averaging period ahead of 1/15/2029. The conversion rate is based on the common stock’s 20-trading-day average volume-weighted average price; holders may convert earlier at the minimum rate, subject to specified exceptions and adjustments.
• Restrictions and priority: While any preferred shares remain outstanding, common-stock dividends and certain purchases or redemptions of common or other junior or parity stock are restricted unless accumulated preferred dividends are paid or provided for. On liquidation, preferred holders receive the $100,000-per-share preference plus accumulated unpaid dividends, after creditors and senior stock but before junior stock.

Investor Takeaways

• The final conversion rate will depend on Oracle’s common-stock price during the averaging period beginning 21 scheduled trading days before 1/15/2029.