Item 1.01. Entry into a Material Definitive Agreement.

Purchase Agreement

On August 17, 2020, the Company entered into a purchase agreement (the "Purchase Agreement") with BofA Securities, Inc. and Morgan Stanley & Co. LLC as representatives of the several initial purchasers named therein (collectively, the "Initial Purchasers"), pursuant to which the Company agreed to issue and sell $350.0 million aggregate principal amount of its 0.25% Convertible Senior Notes due 2025 (the "Notes") in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"). The Notes were initially issued to the Initial Purchasers pursuant to an exemption from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act. In addition, pursuant to the Purchase Agreement, the Company granted the Initial Purchasers an option to purchase, for settlement within a 13-day period beginning on, and including, the date on which the Notes are first issued, up to an additional $50 million aggregate principal amount of Notes on the same terms and conditions. The Initial Purchasers exercised their option in full on August 18, 2020 and a total of $400.0 million aggregate principal amount of Notes were issued pursuant to the Purchase Agreement on August 20, 2020.

The Purchase Agreement includes customary representations, warranties and covenants by the Company and customary closing conditions. Under the terms of the Purchase Agreement, among other things, the Company has agreed to indemnify the Initial Purchasers against certain liabilities.

Convertible Note Hedge Transactions

On August 17, 2020 and August 18, 2020, in connection with the pricing of the Notes and the exercise of the Initial Purchasers' option, respectively, the Company entered into privately negotiated convertible note hedge transactions (the "Convertible Note Hedge Transactions") with each of Bank of America, N.A., Morgan Stanley & Co. LLC, Barclays Bank PLC, through its agent Barclays Capital Inc., and Credit Suisse Capital LLC, through its agent Credit Suisse Securities (USA) LLC (collectively, the "Counterparties"). Certain of the Counterparties or their affiliates are Initial Purchasers under the Purchase Agreement. On August 20, 2020, the Company used approximately $41.2 million of the net proceeds from the offering of the Notes to pay the cost of the Convertible Note Hedge Transactions (after such cost was partially offset by the proceeds to the Company from the sale of the Warrants (as described below)). On August 20, 2020, the Company paid an aggregate of approximately $55.0 million to the Counterparties for the Convertible Note Hedge Transactions. The Convertible Note Hedge Transactions cover, subject to anti-dilution adjustments substantially similar to those in the Notes, approximately 8.9 million shares of the Company's common stock ("Common Stock"), the same number of shares initially underlying the Notes, and are exercisable upon any conversion of the Notes. The Convertible Note Hedge Transactions will expire upon the maturity of the Notes.

The Convertible Note Hedge Transactions are expected generally to reduce the potential dilution to the Common Stock upon conversion of the Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the converted Notes, as the case may be, in the event that the market price per share of Common Stock, as measured under the terms of the Convertible Note Hedge Transactions, is greater than the strike price of the Convertible Note Hedge Transactions, which initially corresponds to the initial conversion price of the Notes, or approximately $44.86 per share of Common Stock.

The Convertible Note Hedge Transactions are separate transactions, entered into by the Company with each of the Counterparties, and are not part of the terms of the Notes. Holders of the Notes will not have any rights with respect to the Convertible Note Hedge Transactions.

The foregoing description of the Convertible Note Hedge Transactions is qualified in its entirety by reference to the (a) form of the confirmation for the base Convertible Note Hedge Transactions entered into with each of the Counterparties on August 17, 2020, which form is attached as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference, and (b) form of the confirmation for the additional Convertible Note Hedge Transactions entered into with each of the Counterparties on August 18, 2020, which form is attached as Exhibit 99.3 to this Current Report on Form 8-K and is incorporated herein by reference.

Warrant Transactions

In addition, concurrently with entering into the Convertible Note Hedge Transactions, on August 17, 2020 and August 18, 2020, the Company separately . . .

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an


           Off-Balance Sheet Arrangement of a Registrant.


The information set forth under Item 1.01 is incorporated herein by reference.

Item 3.02. Unregistered Sales of Equity Securities.

The information set forth under Item 1.01 is incorporated herein by reference.

The Company issued and sold the Notes to the Initial Purchasers in a private placement in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act. The Purchase Agreement also contemplated the resale of the Notes to qualified institutional buyers in reliance on Rule 144A under and Section 4(a)(2) of the Securities Act. The Company relied on these exemptions from registration based in part on representations made by the Initial Purchasers. The Notes, the Warrants and the shares of Common Stock issuable upon conversion of the Notes and exercise of the Warrants have not been registered under the Securities Act, or any state securities laws, and the Notes, the Warrants and the shares of Common Stock issuable upon conversion of the Notes and exercise of the Warrants may not be offered or sold in the United States absent registration or the availability of exemptions from the registration requirements of the Securities Act and applicable state securities laws. The Company does not intend to file a shelf registration statement for the resale of the Notes, the Warrants or the shares of Common Stock issuable upon conversion of the Notes or exercise of the Warrants. Initially, a maximum of 1,000 shares of the Company's common stock may be issued upon conversion of the Notes, based on the initial maximum conversion rate of 30.0932 shares of common stock per $1,000 principal amount of Notes, which is subject to customary anti-dilution adjustment provisions. Initially, a maximum of 17,833,042 shares of the Company's common stock may be issued upon exercise of the Warrants, which is subject to adjustments pursuant to the terms of such Warrants.

Item 7.01. Regulation FD Disclosure.

See Exhibit 99.1 for an illustration of the potential dilutive impact of the Notes and the Convertible Note Hedge Transactions, assuming various hypothetical quarterly average market prices of the Company's common stock at the initial conversion rate.

The information from Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any other filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such a filing.

--------------------------------------------------------------------------------

Item 8.01. Other Events.

On August 17, 2020, the Company issued a press release announcing the commencement of the offering of the Notes. A copy of the press release is attached as Exhibit 99.6 to this Current Report on Form 8-K and is incorporated herein by reference.

On August 17, 2020, the Company issued a press release announcing the pricing of the Notes. A copy of the press release is attached as Exhibit 99.7 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.






Exhibit
  No.       Description

 4.1          Indenture, dated as of August 20, 2020, between Parsons Corporation
            and U.S. Bank National Association.

 4.2          Form of 0.25% Convertible Senior Note due 2025 (included in Exhibit
            4.1).

99.1          Illustrative Table of Potential Dilutive Impact of Convertible
            Senior Notes due 2025 and Call Spread

99.2          Form of Base Convertible Note Hedge Confirmation.

99.3          Form of Additional Convertible Note Hedge Confirmation.

99.4          Form of Base Warrant Confirmation.

99.5          Form of Additional Warrant Confirmation.

99.6          Press Release, dated August 17, 2020

99.7          Press Release, dated August 17, 2020

104         Cover Page Interactive Data File (embedded within the Inline XBRL
            document)

--------------------------------------------------------------------------------

© Edgar Online, source Glimpses