TXNM Energy, Inc. has announced that holders of its 5.75% Junior Subordinated Convertible Notes due 2054 will have the option to convert their notes into common stock starting April 1, 2026, until June 30, 2026. The conversion rate is set at 22.5382 shares of common stock per $1,000 principal amount of Convertible Notes, translating to a conversion price of approximately $44.37 per share. This decision comes as the last reported sale price of the company's common stock exceeded 130% of the conversion price for at least 20 trading days within the 30-day period ending March 31, 2026. Upon conversion, the company will issue a new series of 5.75% non-convertible junior subordinated notes due 2054, alongside shares of common stock for any excess conversion obligation. The company has emphasized that holders opting for conversion will not receive cash for the principal amount of the Convertible Notes being converted, but rather the new notes, which may be less liquid than the common stock. This announcement is significant as it reflects the company's strategy to manage its capital structure and provide options to its investors amidst ongoing market conditions. The company has also indicated that the conversion option is not a recommendation for holders to convert, leaving the decision to the investors. The upcoming merger with Troy ParentCo, LLC, which is expected to close soon, may also influence the conversion dynamics, as it will constitute a 'make-whole fundamental change' for the Convertible Notes, allowing holders to convert their notes for cash based on the merger's share price. Investors are advised to stay informed about the developments surrounding the merger and the implications for their investments in TXNM Energy.

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