By Abigail W. Adams
Portland, Me., Nov. 18 – 8x8 Inc. entered into a subscription agreement with Morgan Stanley to sell an additional $75 million of 0.5% convertible notes due Feb. 1, 2024, according to a news release.
The notes will be consolidated and form a single series with the $287.5 million, including a $37.5 million greenshoe, of convertibles the company issued in a Rule 144A deal in February of this year with an initial conversion premium of 30%.
The notes are non-callable until Feb. 4, 2022 and then may be redeemed subject to a 130% hurdle with a make-whole payment. There are no puts.
The notes are contingently convertible until Oct. 1, 2023. They will be settled in cash, shares or a combination of both at the company’s option.
8x8 plans to use about $9.3 million of the net proceeds to pay the cost of a capped call transaction to be entered into between 8x8 and Morgan Stanley and to use the remaining $63.2 million to add to its cash balances following the acquisition of Wavecell Pte. Ltd. in July, which used about $73 million in cash, and for general corporate purposes.
8x8 is a San Jose, Calif.-based cloud-communications company.
| Issuer: | 8x8 Inc.
|
| Securities: | Convertible senior notes
|
| Amount: | $75 million add-on
|
| Total issue size: | $362.5 million, including $287.5 million issued in February 2019
|
| Maturity: | Feb. 1, 2024
|
| Bookrunner: | Morgan Stanley & Co. LLC
|
| Coupon: | 0.5%
|
| Conversion premium: | 30%
|
| Conversion price: | $25.68
|
| Conversion rate: | 38.9484
|
| Call options: | Non-callable until Feb. 4, 2022 then subject to a 130% hurdle
|
| Put options: | None
|
| Pricing date: | Nov. 18
|
| Distribution: | Rule 144A
|
| Stock symbol: | NYSE: EGHT
|
| Stock price: | $20.82 at close Nov. 18
|
| Market capitalization: | $2.09 billion
|
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