BigBear.ai Expects To Eliminate ~$125M In Convertible Debt Through Conversion, Redemption Of 2029 Convertible Notes And Simplification Of Capital Structure

Conversion and Redemption of 2029 Convertible Notes and Simplification of Capital Structure

BigBear.ai (NYSE:BBAI) (the "Company"), a leading provider of mission-ready artificial intelligence solutions for national security, today announced a move that will provide a significant improvement to its balance sheet following the successful reduction of the majority of its outstanding convertible debt.

The Company has issued a notice to holders of the Company's 6.00% Convertible Senior Secured Notes due 2029 (the "Notes") calling for redemption (the "Redemption") of all outstanding Notes.

On January 16, 2026 (the "Redemption Date"), all then-outstanding Notes that are called for Redemption and have not been submitted for conversion will be redeemed for cash at a price (the "Redemption Price") equal to the principal amount of such Notes plus accrued and unpaid interest on such Notes to, but excluding, the Redemption Date.

The Company expects to eliminate approximately $125 million of debt through a combination of voluntary conversions by noteholders and the Company's redemption of any Notes that have not been converted through the Redemption Date. Approximately $58 million in principal was already voluntarily converted by noteholders in 2025.

We are taking this action to strengthen the Company's balance sheet at the first opportunity permitted under the terms of the Notes and expect to issue shares of our Common Stock that we reserved for this purpose when we first issued the Notes in 2024. Importantly, the Company currently expects that substantially all noteholders will voluntarily convert their notes and, as a result, these transactions are currently expected to be completed without any material cash outlay by the Company. Instead, the Company expects to satisfy most or all of its obligations under the Notes by issuing previously reserved shares of the Company's common stock, preserving liquidity while materially strengthening the Company's balance sheet.