Company: FSLY
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001517413-25-000111
Chunk: 313

Company: Fastly, Inc.
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 8
Chunk 313
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 governing the 2028 Notes, holders may require the Company to repurchase for cash all or any portion of their 2028 Notes at a fundamental change repurchase price equal to 100% of the principal amount of the 2028 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date.The Company evaluated the terms of the 2028 Notes and concluded that the conversion feature does not require separation and that there were no other derivatives that required separation. As such, the Company has combined these features with the host contract and the Company accounts for the 2028 Notes as a single liability in long-term debt on its consolidated balance sheet. The Company determined the fair value of the 2028 Notes on December 5, 2024 to be $155.7 million using a valuation technique of quoted prices in dealer markets under the market approach that resulted in a debt premium of $5.7 million. Transaction costs of $5.8 million incurred related to the issuance of the 2028 Notes, partially offset by the aforementioned premium, were recorded as contra-liability and represents the difference between the principal and the carrying amount of the 2028 Notes, which is amortized to interest expense using the effective interest method over the term of the 2028 Notes.As of March 31, 2025, the conversion conditions had not been met and therefore the 2028 Notes were not yet convertible.The following table reflects the carrying values of the long-term debt as of March 31, 2025 and December 31, 2024:As of March 31, 2025As of December 31, 2024(in thousands)(in thousands)Convertible Senior notes (effective interest rate of 0.38% for the 2026 Notes and an effective interest rate of 7.77% for the 2028 Notes)Principal amount$338,594 $338,594 Less: unamortized debt issuance costs(126)(980)Less: current portion of long-term debt(188,594)— Long-term debt, less current portion$149,874 $337,614 For the three months ended March 31, 2025 and 2024, interest expense related to the Company’s debt obligations was $3.1 million and $0.4 million, respectively. As of March 31, 2025 and December 31, 2024, the total estimated