{"url_path":"/sec/aeis/8-k/2026-05-18/item-1-01","section_key":"item-1-01","section_title":"Item 1.01 Entry into a Material Definitive Agreement.**","topic":"sec","document":{"doc_type":"8-K","doc_date":"2026-05-18","source_url":"https://www.sec.gov/Archives/edgar/data/927003/0001104659-26-063191-index.html","accession_number":"0001104659-26-063191","cik":"0000927003","ticker":"AEIS","issuer_name":"ADVANCED ENERGY INDUSTRIES INC","edgar_url":"https://www.sec.gov/Archives/edgar/data/927003/0001104659-26-063191-index.html","primary_entity_key":"0000927003","primary_entity_name":"ADVANCED ENERGY INDUSTRIES INC"},"word_count":2022,"has_tables":true,"body_markdown":"**Item 1.01.   Entry into a Material Definitive Agreement.**\n\n \n\nOn May 18, 2026, Advanced Energy Industries, Inc. (the “Company”)\ncompleted its previously announced private unregistered offering of $1.15 billion aggregate principal amount of its 0% Convertible Senior\nNotes due 2031 (the “Notes”), which amount includes the full exercise of the initial purchasers’ option to purchase\nup to $150.0 million aggregate principal amount of additional Notes.\n\n \n\n*Indenture and Notes*\n\n \n\nThe Notes were issued under an Indenture (the “Indenture”),\ndated as of May 18, 2026, by and between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”).\nThe Indenture provides, among other things, that the Notes will not bear regular interest, and the principal amount of the notes will\nnot accrete. The Notes will mature on May 15, 2031, unless earlier repurchased or redeemed by the Company or converted pursuant to\ntheir terms.\n\n \n\nThe Company received net proceeds from the offering of the Notes of\napproximately $1,128.1 million, after deducting the initial purchasers’ discounts and after deducting offering expenses payable\nby the Company. The Company used $69.0 million of the net proceeds from the offering to pay the cost of the Capped Call Confirmations\nentered into in connection with the offering, as described below. In addition, the Company paid approximately $442.4 million of the net\nproceeds from the offering and issued approximately 1.98 million shares of the Company’s common stock, par value $0.001 per share\n(“Common Stock”), collectively, in exchange for approximately $438.3 million aggregate principal amount of its previously\nissued 2.50% Convertible Senior Notes due 2028 (the “2028 Convertible Notes”), as described below. The Company intends to\nuse the remainder of the net proceeds from the offering for general corporate purposes.\n\n \n\nThe Company may not redeem the Notes prior to May 21, 2029, except\nin the event of a cleanup redemption as described below. The Company may redeem for cash all or any portion of the Notes, at the Company’s\noption at any time and from time to time, on or after May 21, 2029 if the last reported sale price of the Common Stock has been at\nleast 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any consecutive 30\ntrading-day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the\ndate on which the Company provides the related notice of optional redemption (an “Optional Redemption”). In addition, the\nCompany may redeem for cash, all but not less than all, of the Notes at any time if the amount of the Notes that remains outstanding is\nless than 25% of the aggregate principal amount of the Notes initially issued under the Indenture (a “Cleanup Redemption”).\nThe redemption price for any Optional Redemption or Cleanup Redemption will be 100% of the principal amount of the Notes to be redeemed,\n*plus* accrued and unpaid special interest, if any, to, but excluding, the relevant redemption date. No sinking fund is provided\nfor the Notes.\n\n \n\nPrior to the close of business on the business day immediately preceding\nFebruary 15, 2031, holders of the Notes may convert their Notes at their option only under the following circumstances: (i) during\nthe 30 trading day period beginning on, and including, the 21st trading day of any fiscal quarter commencing after the fiscal quarter\nending on June 30, 2026, if the last reported sale price per share of the Common Stock exceeds 130% of the conversion price for each\nof at least five trading days (whether or not consecutive) during the first 20 trading days of such fiscal quarter (ii) during the\nfive-business day period after any five-consecutive trading day period (the “measurement period”) in which the trading price\n(as defined below) per $1,000 principal amount of the Notes for each trading day of the measurement period was less than 98% of the product\nof the last reported sale price of the Common Stock and the conversion rate on each such trading day; (iii) if the Company calls\nany or all of the Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding\nthe redemption date; or (iv) upon the occurrence of specified corporate events. On or after February 15, 2031, until the close\nof business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Notes at any time,\nregardless of the foregoing circumstances.\n\n \n\nUpon conversion, the Company will pay cash up to the aggregate principal\namount of the Notes to be converted and pay or deliver, as the case may be, cash, shares of Common Stock or a combination of cash and\nCommon Stock at the Company’s election, in respect of the remainder, if any, of the Company’s conversion obligation in excess\nof the aggregate principal amount of the Notes being converted. The initial conversion rate is 1.9655 shares of Common Stock per $1,000\nprincipal amount of Notes (which is equivalent to an initial conversion price of approximately $508.78 per share). The conversion rate\nis subject to adjustment upon the occurrence of certain specified events as set forth in the Indenture. In addition, following certain\ncorporate events that occur prior to the maturity date or if the Company delivers a notice of redemption, the Company will increase, in\ncertain circumstances, the conversion rate for a holder who elects to convert its Notes in connection with such corporate event or notice\nof redemption. The maximum number of shares of Common Stock issuable in connection with the conversion of the Notes is 3,390,430.\n\n \n\n \n\n \n\nUpon the occurrence of a fundamental change (as defined in the Indenture),\nsubject to certain conditions, holders of the Notes may require the Company to repurchase all or a portion of the Notes for cash at a\nprice equal to 100% of the principal amount of the Notes to be repurchased, *plus* accrued and unpaid special interest, if any, to,\nbut excluding, the repurchase date.\n\n \n\nThe Indenture contains customary events of default. In the event of\ncertain events of bankruptcy, insolvency or reorganization involving the Company or any of its significant subsidiaries, 100% of the principal\nof the Notes *plus* accrued and unpaid special interest, if any, may be declared immediately due and payable, subject to certain\nconditions in the Indenture. In the case of any other event of default, the Trustee or the holders of at least 25% in aggregate principal\namount of the then-outstanding Notes may declare the Notes to be due and payable immediately.\n\n \n\nThe initial purchasers and their respective affiliates have in the\npast performed commercial banking, investment banking and advisory services for the Company from time to time for which they have received\ncustomary fees and reimbursement of expenses and may, from time to time, engage in transactions with and perform services for the Company\nin the ordinary course of their business for which they may receive customary fees and reimbursement of expenses.\n\n \n\nThe foregoing descriptions of the Indenture and the Notes are qualified\nin their entirety by reference to the full text of the Indenture and the Form of Global 0% Convertible Senior Note due 2031, copies\nof which are filed as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K (this “Current Report”)\nand are incorporated herein by reference.\n\n \n\n*Capped Call Transactions*\n\n \n\nIn connection with the pricing of the Notes on May 13, 2026 and\nthe exercise of the initial purchasers’ option to purchase additional Notes on May 14, 2026, the Company entered into privately\nnegotiated capped call transactions (collectively, the “Capped Call Confirmations”) with certain of the initial purchasers\nor their respective affiliates and other financial institutions (the “Counterparties”). The Capped Call Confirmations cover,\nsubject to anti-dilution adjustments substantially similar to those applicable to the Notes, the number of shares of Common Stock initially\nunderlying the Notes, and are expected generally to reduce potential dilution to the Common Stock upon any conversion of Notes and/or\noffset any cash payments the Company is required to make in excess of the principal amount of converted Notes, as the case may be, with\nsuch reduction and/or offset subject to a cap.\n\n \n\nThe Capped Call Confirmations are expected generally to reduce potential\ndilution to the Common Stock upon any conversion of the Notes and/or offset any cash payments the Company is required to make in excess\nof the principal amount of the converted Notes, as the case may be, in the event that the market price per share of the Common Stock,\nas measured under the terms of the Capped Call Confirmations, is greater than the strike price of the Capped Call Confirmations, which\ninitially corresponds to the conversion price of the Notes and is subject to anti-dilution adjustments substantially similar to those\napplicable to the conversion rate of the Notes. The Capped Call Confirmations are separate transactions entered into by the Company with\nthe Counterparties and are not part of the terms of the Notes. Holders of the Notes do not have any rights with respect to the Capped\nCall Confirmations. A copy of the form of Capped Call Confirmation is filed as Exhibit 10.1 to this Current Report and is incorporated\nby reference herein. The foregoing description of the terms of the Capped Call Confirmations does not purport to be complete and is qualified\nin its entirety by reference to such exhibit.\n\n \n\n*The Exchange Agreements*\n\n \n\nOn May 13, 2026, the Company entered into privately negotiated\nexchange agreements (the “Exchange Agreements”) with certain holders of its outstanding 2028 Convertible Notes pursuant to\nwhich such holders exchanged an aggregate of approximately $438.3 million principal amount of 2028 Convertible Notes for aggregate consideration\nconsisting of approximately $442.4 million in cash and approximately 1.98 million shares of Common Stock (such transactions, the “Exchange\nTransactions”), in each case, pursuant to exemptions from registration under the Securities Act of 1933, as amended (the “Securities\nAct”), and the rules and regulations thereunder. The 2028 Convertible Notes were previously issued pursuant to an indenture,\ndated as of September 12, 2023 (the “2028 Convertible Notes Indenture”), between the Company and U.S. Bank Trust Company,\nNational Association, as trustee. Following the closing of the Exchange Transactions, approximately $136.7 million in aggregate principal\namount of 2028 Convertible Notes remain outstanding with terms unchanged. The 2028 Convertible Notes exchanged in the Exchange Transactions\nhave been surrendered to the trustee for cancellation in accordance with the terms of the 2028 Convertible Notes Indenture.\n\n \n\n \n\n \n\nA copy of the form of exchange agreement, substantially in the form\nentered into on May 13, 2026 with the exchanging holders in the Exchange Transactions, is filed as Exhibit 10.2 to this Current\nReport and is incorporated herein by reference. The foregoing description of the Exchange Agreements does not purport to be complete and\nis qualified in its entirety by reference to such exhibit.\n\n \n\n*Unwind of Existing Call Spread Transactions*\n\n \n\nIn connection with the issuance of the 2028 Convertible Notes, the\nCompany entered into convertible note hedge transactions (the “Existing Hedge Transactions”) and separate warrant transactions\n(the “Existing Warrant Transactions” and, together with the Existing Hedge Transactions, the “Existing Call Spread Transactions”)\nwith certain financial institutions (the “Existing Counterparties”). In connection with the Exchange Transactions, the Company\nentered into agreements with the Existing Counterparties to partially unwind (i) the Existing Hedge Transactions in a notional amount\ncorresponding to the principal amount of 2028 Convertible Notes exchanged (the “Bond Hedge Unwind Agreements”) and (ii) the\nExisting Warrant Transactions with respect to a number of shares equal to the notional shares underlying such 2028 Convertible Notes exchanged\n(the “Warrant Unwind Agreements” and, together with the Bond Hedge Unwind Agreements, the “Unwind Agreements”).\nIn connection with such partial unwind, the Company received on a net basis from the Existing Counterparties an aggregate of approximately\n$44.6 million.\n\n \n\nCopies of the form of Bond Hedge Unwind Agreement and the form of Warrant\nUnwind Agreement are filed as Exhibits 10.3 and 10.4, respectively, to this Current Report and are incorporated herein by reference. The\nforegoing descriptions of the Unwind Agreements do not purport to be complete and are qualified in their entirety by reference to such\nexhibits."}