Model N talks $220 million five-year convertible notes to yield 1.875%-2.375%, up 30%-35%

By Abigail W. Adams

Portland, Me., March 7 – Model N Inc. plans to price $220 million of five-year convertible notes after the market close on Wednesday with price talk for a coupon of 1.875% to 2.375% and an initial conversion premium of 30% to 35%, according to a market source.

Goldman Sachs & Co. LLC, Jefferies LLC and RBC Capital Markets LLC are bookrunners for the Rule 144A deal, which carries a greenshoe of $33 million.

The notes are non-callable until March 20, 2026 and then subject to a 130% hurdle.

They are putable upon a fundamental change.

Model N will enter into privately negotiated transactions to repurchase a portion of its 2.625% notes due 2025.

Proceeds will be used to fund the repurchase of the 2.625% notes with remaining proceeds to be used for general corporate purposes.

Model N is a San Mateo, Calif.-based software company.

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