Alkami Announces Pricing of Secondary Offering of Common Stock by Selling Stockholders

Rhea-AI Summary

Alkami Technology (Nasdaq: ALKT) has announced the pricing of a secondary offering of 5,000,000 shares of common stock by selling stockholders. The offering is expected to close on August 12, 2024. J.P. Morgan Securities is acting as the underwriter and sole book-running manager. The underwriter has a 30-day option to purchase up to an additional 750,000 shares. Alkami will not sell any shares or receive any proceeds from the offering. The offering is being made pursuant to an automatically effective shelf registration statement on Form S-3, which became effective on August 8, 2024.

Positive

• No dilution for existing shareholders as Alkami is not issuing new shares
• Potential increased liquidity in the stock due to larger float

Negative

• Large shareholders reducing their stake, which might be perceived negatively by the market
• Potential downward pressure on stock price due to increased supply of shares

Financial Analyst

The secondary offering of 5,000,000 shares by Alkami's major stockholders is a significant development for investors. This move suggests that early investors are looking to cash out part of their holdings, which could potentially impact the stock price. The fact that Alkami itself isn't selling shares or receiving proceeds indicates that the company doesn't require additional capital at this time.

The involvement of J.P. Morgan as the sole underwriter lends credibility to the offering. However, investors should note that this increased supply of shares in the market might lead to short-term price pressure. Long-term, this offering could improve liquidity and float of Alkami's stock, potentially making it more attractive to institutional investors.

Market Research Analyst

This secondary offering signals a shift in ownership structure for Alkami. The selling stockholders, including notable names like General Atlantic and S3 Ventures, are reducing their stakes. This could be interpreted as these early investors believing the company has reached a mature stage in its growth trajectory.

For the broader market, this move might spark interest in the digital banking solutions sector. Alkami's position as a cloud-based provider for U.S. financial institutions makes it a barometer for fintech trends. Investors should monitor how this offering affects Alkami's stock price and trading volume, as it could provide insights into market sentiment towards similar companies in the space.

Legal Expert

The legal framework surrounding this secondary offering appears robust. Alkami has utilized an automatically effective shelf registration on Form S-3, which streamlines the offering process. This indicates the company meets the SEC's requirements for well-known seasoned issuers, a positive sign of its market presence and financial stability.

The clear delineation that Alkami isn't selling shares or receiving proceeds helps mitigate potential legal risks related to insider trading concerns. The 30-day option for additional shares provides flexibility but also requires careful monitoring to ensure compliance with securities laws. Investors should review the final prospectus supplement for complete legal details and risk factors.

PLANO, Texas, Aug. 9, 2024 /PRNewswire/ -- Alkami Technology, Inc. (Nasdaq: ALKT) ("Alkami" or the "Company"), a leading cloud-based digital banking solutions provider for financial institutions in the U.S., today announced the pricing of the previously announced underwritten secondary offering (the "Offering") of an aggregate of 5,000,000 shares of the Company's common stock to be sold by entities affiliated with General Atlantic, L.P., S3 Ventures Fund III, L.P., George B. Kaiser and Brian R. Smith (collectively, the "Selling Stockholders"). The Offering is expected to close on August 12, 2024, subject to the satisfaction of customary closing conditions. The underwriter has a 30-day option to purchase up to an additional 750,000 shares of the Company's common stock from the Selling Stockholders at the public offering price, less underwriting discounts and commissions.

The Selling Stockholders will receive all of the net proceeds from the Offering. The Company will not sell any shares of its common stock in the Offering and will not receive any of the proceeds from the sale of shares of the Company's common stock in the Offering.  

J.P. Morgan Securities LLC is acting as the underwriter and sole book-running manager for the Offering.

The Offering is being made pursuant to an automatically effective shelf registration statement on Form S-3, which has been filed by the Company with the Securities and Exchange Commission (the "SEC") and became effective on August 8, 2024. The Offering is being made only by means of a prospectus supplement and accompanying prospectus that form a part of the registration statement. A preliminary prospectus supplement and the accompanying prospectus relating to and describing the terms of the Offering was filed with the SEC on August 8, 2024. The final prospectus supplement and the accompanying prospectus relating to and describing the terms of the Offering will be filed with the SEC and will be available on the SEC's website at http://www.sec.gov. Copies of the final prospectus supplement, when available, and accompanying prospectus relating to the Offering may be obtained from: J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by email at prospectus-eq_fi@jpmchase.com and postsalemanualrequests@broadridge.com.

This press release is for informational purposes only and shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of, these securities, in any state or jurisdiction in which such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Alkami

Alkami Technology, Inc. is a leading cloud-based digital banking solutions provider for financial institutions in the United States that enables clients to grow confidently, adapt quickly and build thriving digital communities. Alkami helps clients transform through retail and commercial banking, digital account opening, and data and marketing solutions.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains "forward-looking" statements relating to the Offering and expected closing date. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to management. Forward-looking statements include all statements that are not historical facts and may be identified by terms such as "expects," "believes," "plans," or similar expressions and the negatives of those terms. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements, expressed or implied by the forward-looking statements. Factors that may materially affect such forward-looking statements include: our limited operating history and history of operating losses; our ability to manage future growth; our ability to attract new clients and retain and expand existing clients' use of our solutions; the unpredictable and time-consuming nature of our sales cycles; our ability to maintain, protect and enhance our brand; our ability to accurately predict the long-term rate of client subscription renewals or adoption of our solutions; our reliance on third-party software, content and services; our ability to effectively integrate our solutions with other systems used by our clients; intense competition in our industry; any downturn, consolidation or decrease in technology spend in the financial services industry, including as a result of recent closures of certain financial institutions and liquidity concerns at other financial institutions; our ability and the ability of third parties on which we rely to prevent and identify breaches of security measures (including cybersecurity) and resulting disruptions of our systems or operations and unauthorized access to client customer and other data; our ability to successfully integrate acquired companies or businesses; our ability to comply with regulatory and legal requirements and developments; our ability to attract and retain key employees; the political, economic and competitive conditions in the markets and jurisdictions where we operate; our ability to maintain, develop and protect our intellectual property; our ability to respond to evolving technological requirements to develop or acquire new and enhanced products that achieve market acceptance in a timely manner; our ability to estimate our expenses, future revenues, capital requirements, our needs for additional financing and our ability to obtain additional capital; the completion of the Offering; the satisfaction of customary closing conditions related to the Offering; and other factors described in our filings with the Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

Investor Relations Contact
Steve Calk
ir@alkami.com

Media Relations Contacts
Marla Pieton
marla.pieton@alkami.com

Valerie Kerner
alkami@fullyvested.com

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SOURCE Alkami Technology, Inc.

FAQ

How many shares of ALKT stock are being offered in the secondary offering?

The secondary offering includes 5,000,000 shares of Alkami Technology (ALKT) common stock, with an option for the underwriter to purchase an additional 750,000 shares.

When is the closing date for Alkami's (ALKT) secondary stock offering?

The secondary stock offering for Alkami Technology (ALKT) is expected to close on August 12, 2024, subject to customary closing conditions.

Will Alkami (ALKT) receive any proceeds from this secondary offering?

No, Alkami Technology (ALKT) will not receive any proceeds from the secondary offering. All net proceeds will go to the selling stockholders.

Who are the selling stockholders in Alkami's (ALKT) secondary offering?

The selling stockholders in Alkami's (ALKT) secondary offering are entities affiliated with General Atlantic, L.P., S3 Ventures Fund III, L.P., George B. Kaiser, and Brian R. Smith.