SoFi Technologies (SOFI) Provides Update on Notes Transactions

As previously disclosed, on March 4, 2024, SoFi Technologies (NASDAQ: SOFI) entered into separate, privately negotiated exchange agreements (the “Exchange Agreements”), with a limited number of holders of its 0% Convertible Senior Notes due 2026 (the “2026 notes”), to exchange $600 million in aggregate principal amount of 2026 notes for shares of the Company’s common stock based on the daily volume-weighted average price per share of common stock over a specified period. On March 25, 2024 and March 26, 2024, the Company settled the transactions contemplated by the Exchange Agreements and issued an aggregate of 72,621,879 shares of common stock pursuant thereto.

In addition, as previously disclosed, on March 8, 2024, the Company issued 1.25% convertible senior notes due 2029 (the “notes”) and entered into privately negotiated capped call transactions (the “Capped Call Transactions”). Following the issuance of the notes and entry into the Capped Call Transactions, the transactions contemplated by the Exchange Agreements (the “exchanges”), if completed as of the end of the fourth quarter of 2023, would have increased the total risk-based capital ratio of the Company by more than 200 basis points from 15.3% to more than 17.3% on a pro forma basis. In addition, the exchanges are expected to (1) be accretive to GAAP net income for the first quarter of 2024 and to have a negligible impact on GAAP earnings per share, and (2) be accretive to total tangible book value and tangible book value per share by 8% to 10%, including the impact of the cost of the Capped Call Transactions. Furthermore, in connection with the issuance of the notes, the Company expects to save between $40 to $60 million in annual interest expense and dividend payments by using the proceeds of the notes issuance to pay down higher cost instruments including outstanding shares of Series 1 Redeemable Preferred Stock which has a 12.5% annual cost, set to rise in May 2024.

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