Five9 Announces Pricing of Upsized $650 Million Convertible Notes Offering

Five9, Inc. (NASDAQ: FIVN), the Intelligent CX Platform provider, today announced the pricing of $650.0 million aggregate principal amount of 1.00% convertible senior notes due 2029 (the “notes”) in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Act”). The offering size was increased from the previously announced offering size of $600.0 million aggregate principal amount of the notes. Five9 also granted the initial purchasers of the notes a 13-day option to purchase up to an additional $97.5 million aggregate principal amount of the notes.

The sale of the notes to the initial purchasers is expected to settle on March 1, 2024, subject to customary closing conditions, and is expected to result in approximately $633.5 million (or, if the initial purchasers fully exercise their option to purchase additional notes, approximately $728.8 million) in net proceeds to Five9 after deducting the initial purchasers’ discount and estimated offering expenses payable by Five9.

The notes will be senior, unsecured obligations of Five9, and interest will be payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2024. The notes will mature on March 15, 2029, unless earlier converted, redeemed or repurchased. Five9 may not redeem the notes prior to March 22, 2027; on or after March 22, 2027 and prior to December 15, 2028, Five9 may redeem the notes, at its option and subject to certain conditions, as detailed below.

Five9 expects to use approximately $304.9 million of the net proceeds of the offering of the notes to repurchase $313.1 million aggregate principal amount of its outstanding 0.500% convertible senior notes due 2025 (the “2025 notes”) (such transactions, the “2025 note repurchases”). Five9 also expects to use approximately $81.3 million of the net proceeds of the offering of the notes to pay the cost of the capped call transactions described below. The remainder of the net proceeds from the offering will be used for working capital and other general corporate purposes. Five9 expects that holders of the 2025 notes that sell their 2025 notes to Five9 may enter into or unwind various derivatives with respect to Five9’s common stock and/or purchase or sell shares of Five9’s common stock in the market to hedge their exposure in connection with these transactions. These activities could increase (or reduce the size of any decrease in) the market price of Five9’s common stock or the notes.