Rapid7 Announces Proposed Private Offering of $500 Million of Convertible Senior Notes

BOSTON, March 15, 2021 (GLOBE NEWSWIRE) -- Rapid7, Inc. (“Rapid7”) (Nasdaq: RPD) today announced that it intends to offer, subject to market conditions and other factors, $500 million aggregate principal amount of convertible senior notes due 2027 (the “notes”) in a private placement to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Rapid7 also intends to grant the initial purchasers of the notes an option to purchase up to an additional $75 million aggregate principal amount of notes.

The notes will be general unsecured obligations of Rapid7 and will accrue interest payable semiannually in arrears. The notes will be convertible into cash, shares of Rapid7’s common stock or a combination of cash and shares of Rapid7’s common stock, at Rapid7’s election. The interest rate, initial conversion rate and other terms of the notes will be determined at the time of pricing of the offering.

Rapid7 expects to use a portion of the net proceeds from the offering of the notes to repurchase for a combination of cash and shares of its common stock a portion of its outstanding 1.25% Convertible Senior Notes due 2023 (the “2023 notes”) in privately negotiated transactions to be entered into concurrently with the pricing of the notes and to pay the cost of the capped call transactions described below. The terms of any repurchases of the 2023 notes will depend on factors, including the market price of Rapid7’s common stock and the trading price of the 2023 notes at the time of such repurchases.

Rapid7 expects to use the remainder of the net proceeds for general corporate purposes, which may include continued investment in its sales and marketing efforts, product development, general and administrative matters, and working capital. One of Rapid7’s primary growth strategies continues to be to pursue opportunities to acquire businesses or pursue strategic investments in complementary businesses or technologies or for geographic expansion, and at any time, including as of the date of this offering, Rapid7 is engaged in active discussions regarding such acquisition opportunities. Although Rapid7 has not entered into definitive agreements or commitments with respect to any material acquisitions at this time, if any such transactions are consummated it may use a portion of the proceeds from this offering to fund the purchase price thereof.