TYL · Tyler Technologies, Inc.

Tyler Technologies completed a significant financing event by issuing $1.4375 billion in 0.50% Convertible Senior Notes due 2031, including the full exercise of the $187.5 million overallotment option by initial purchasers. This upsized offering provides substantial low-cost capital, with a coupon of just 0.50% payable semi-annually from January 2027. The notes are senior unsecured obligations, ranking equally with existing senior debt but subordinated to secured debt and subsidiary obligations. Key investor protections include conversion rights starting conditionally before April 15, 2031 and freely thereafter until maturity, with an initial conversion price of $405.94 (30% premium to May 11 closing price) and make-whole adjustments for fundamental changes. Redemption is possible after July 20, 2029 if stock price thresholds are met and notes are freely tradable. Holders can require repurchase upon fundamental changes. To mitigate dilution, the company entered base and additional capped call transactions costing $187.2 million total, lifting the effective conversion price to $655.77 (110% premium). Immediately deploying proceeds, Tyler repurchased 1,026,900 shares for $320.7 million, bringing YTD 2026 buybacks to 2.1 million shares under its $1 billion authorization, signaling strong confidence in valuation and commitment to capital return. Net proceeds of $1.408 billion enhance financial flexibility for growth initiatives while the private Rule 144A placement to QIBs reserved 4.6 million shares for potential conversions.