The RealReal Prices Offering of $250.0 Million 1.00% Convertible Senior Notes Due 2028

SAN FRANCISCO, March 04, 2021 (GLOBE NEWSWIRE) -- The RealReal, Inc. (Nasdaq: REAL), the world’s largest online marketplace for authenticated, consigned luxury goods—today announced the pricing of its offering of $250.0 million in aggregate principal amount of its 1.00% Convertible Senior Notes due 2028 (the “notes”) in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). In connection with the offering, the Company granted the initial purchasers a 13-day option to purchase up to an additional $37.5 million in aggregate principal amount of notes. The offering is expected to close on March 8, 2021, subject to customary closing conditions.

The notes will be convertible into cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election, at an initial conversion rate of 31.4465 shares of the Company’s common stock per $1,000 principal amount of the notes, which is equivalent to an initial conversion price of approximately $31.80 per share of the Company’s common stock. The initial conversion price of the notes represents a premium of approximately 32.5% over the $24.00 closing price of the Company’s common stock on March 3, 2021.

In connection with the pricing of the notes, the Company has entered into privately negotiated capped call transactions, with certain of the initial purchasers or their affiliates and another financial institution (the “hedge counterparties”). The capped call transactions will cover, subject to anti-dilution adjustments, the number of shares of common stock underlying the notes sold in the offering. The capped call transactions are generally expected to reduce potential dilution to the Company’s common stock upon any conversion of notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted notes, as the case may be, with such reduction and/or offset subject to a cap. The cap price of the capped call transactions will initially be $48.00 per share, which represents a premium of 100% over the closing price of the Company’s common stock of $24.00 per share on March 3, 2021, and is subject to certain adjustments under the terms of the capped call transactions.