Rackspace Technology Announces Increase to Late Exchange Consideration for Exchange Offer Relating to its 3.50% First-Priority Senior Secured Notes due 2028
29 Mars 2024 - 10:11PM
Rackspace Technology®
(NASDAQ: RXT) (“Rackspace”
or the “Company”), a leading end-to-end hybrid, multicloud, and AI
technology solutions company, today announced that its indirect
subsidiary Rackspace Finance, LLC (the “New Issuer”) is amending
the terms of its previously announced offer (the “Amendment”) to
eligible holders in respect of any and all of the 3.50%
First-Priority Senior Secured Notes due 2028 (the “Existing Secured
Notes”) issued by Rackspace’s indirect subsidiary Rackspace
Technology Global, Inc., to (i) (A) exchange certain of those
Existing Secured Notes for new 3.50% FLSO Senior Secured Notes due
2028 (the “Exchange Notes”) issued by the New Issuer and (B) have
purchased for cancellation certain of those Existing Secured Notes
by the New Issuer for cash (collectively, the “Exchange Offer”),
and (ii) fund (the “Funding Offer” and, together with the Exchange
Offer, the “Offers”) new senior secured first lien first out term
loans (the “New FLFO Term Loans”) of the New Issuer, in each case,
subject to the terms and conditions of the offering memorandum
dated March 14, 2024 (as supplemented or otherwise modified from
time to time, the “Offering Memorandum”).
Pursuant to the Amendment, holders who validly tender (and do
not validly withdraw) their Existing Secured Notes at or prior to
the Expiration Time will be eligible to receive the “Late Exchange
Consideration” summarized in the table below, which reflects an
increase from the Late Exchange Consideration set forth in the
Offering Memorandum. Pursuant to the Amendment, the Expiration Time
will now be 5:00 p.m., New York City time, on April 12, 2024. The
Final Settlement Date is expected to occur on April 16, 2024 (the
second business day after the Expiration Time). Other than as set
forth in this paragraph, all other terms and conditions of the
Exchange Offer remain as set forth in the Offering Memorandum.
CUSIP Numbers(1) |
|
Early Exchange Consideration for each $1,000 Principal
Amount of Existing Secured Notes Tendered on or Prior to the Early
Participation Time |
|
Late Exchange Consideration for each $1,000 Principal
Amount of Existing Secured Notes Tendered After the Early
Participation Time |
|
With respect to $700 Principal Amount of Existing Secured
Notes |
|
With respect to $300 Principal Amount of Existing Secured
Notes |
|
With respect to $700 Principal Amount of Existing Secured
Notes |
|
With respect to $330 Principal Amount of Existing Secured
Notes |
750098 AB1 U7502E AB0 |
|
$700 of Exchange Notes(2) |
|
$0.7875 in cash (the “Early Payment Amount”)(3) |
|
$700 of Exchange Notes(2) |
|
$0.7875 in cash (the “Late Payment Amount”)(3) |
_________________________
(1) |
No
representation is made as to the correctness or accuracy of the
CUSIP numbers listed in this release or printed on the Existing
Secured Notes. CUSIP numbers are provided solely for
convenience. |
|
|
(2) |
Holders of Existing Secured Notes that are accepted for
exchange pursuant to the Exchange Offer will be entitled to receive
accrued and unpaid interest in cash on the Existing Secured Notes
exchanged for Exchange Notes up to, but excluding, March 12, 2024.
Interest on the Exchange Notes will accrue from March 12, 2024,
with the first interest payment occurring on August 15, 2024. |
|
|
(3) |
No additional payment will be made for accrued and unpaid
interest on Existing Secured Notes purchased and cancelled for the
Early Payment Amount or the Late Payment Amount (together with the
Early Payment Amount, the “Payment Amounts”), as applicable. |
|
|
Consummation of the Exchange Offer is
conditioned upon the satisfaction or waiver of the conditions set
forth in the Offering Memorandum.
The Exchange Offer is only being made, and the
Exchange Notes are only being offered and issued to holders of
Existing Secured Notes who are (x) reasonably believed to be
“qualified institutional buyers” as defined in Rule 144A under the
Securities Act of 1933, as amended (the “Securities Act”) or (y)
not “U.S. persons” as defined in Rule 902 under the Securities Act
and in compliance with Regulation S under the Securities Act. The
holders of Existing Secured Notes who are eligible to participate
in the Exchange Offer pursuant to at least one of the foregoing
conditions are referred to as “eligible holders.”
The New Issuer is making the Offers only to
eligible holders through, and pursuant to, the terms of the
Offering Memorandum. The complete terms and conditions of the
Offers are set forth in the Offering Memorandum. None of Rackspace,
the New Issuer, the Guarantors (as defined in the Offering
Memorandum), the Transaction Agent, the Fronting Lender, or any
other person takes any position or makes any recommendation as to
whether or not eligible holders should participate in the
Offers.
Only eligible holders may receive a copy of the
Offering Memorandum and participate in the Offers. We have retained
Epiq to act as transaction agent for the Offers and Jefferies
Capital Services, LLC to act as the fronting lender for the Funding
Offer (the “Fronting Lender”). Holders of Existing Secured Notes
wishing to certify that they are eligible holders in order to be
eligible to receive a copy of the Offering Memorandum should
complete the eligibility letter and return it to Epiq as directed
therein. Holders of Existing Secured Notes may complete the
eligibility letter on-line at
https://epiqworkflow.com/cases/RackspaceEL or obtain a PDF copy of
the eligibility letter by requesting a copy from
tabulation@epiqglobal.com and referencing “Rackspace” in the
subject line. The eligibility letter can be returned via the online
portal or by emailing a scan of both pages of the fully completed
letter to Epiq at Tabulation@epiqglobal.com and referencing
“Rackspace” in the subject line. Once your response has been
reviewed and cleared by Epiq, you will receive the Offering
Memorandum from Epiq by email.
This press release is for informational purposes
only and does not constitute an offer to sell, or a solicitation of
an offer to buy, any security and does not constitute an offer,
solicitation or sale of any security in any jurisdiction in which
such offer, solicitation or sale would be unlawful. The Exchange
Offer is being made in reliance on the exemption from registration
provided by Section 4(a)(2) of the Securities Act, has not been
registered with the U.S. Securities and Exchange Commission (the
“SEC”) and relies on exemptions under state securities laws.
About Rackspace Technology
Rackspace Technology is a leading
end-to-end hybrid, multicloud, and AI solutions company. We design,
build, and operate our customers’ cloud environments across all
major technology platforms, irrespective of technology stack or
deployment model. We partner with our customers at every stage of
their cloud journey, enabling them to modernize applications, build
new products, and adopt innovative technologies.
Forward-Looking Statements
The Company has made statements in this press
release that are forward-looking and therefore subject to risks and
uncertainties. All statements, other than statements of historical
fact, included in this press release are, or could be,
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995 and are made in reliance
on the safe harbor protections provided thereunder. These
forward-looking statements include statements related to the Offers
and the Company’s ability to consummate the Offers within the time
period expected, or at all. Any forward-looking statement made in
this press release speaks only as of the date on which it is made.
The Company undertakes no obligation to publicly update or revise
any forward-looking statement, whether as a result of new
information, future developments or otherwise. Forward-looking
statements can be identified by various words such as “expects,”
“intends,” “will,” “anticipates,” “believes,” “confident,”
“continue,” “propose,” “seeks,” “could,” “may,” “should,”
“estimates,” “forecasts,” “might,” “goals,” “objectives,”
“targets,” “planned,” “projects,” and similar expressions. These
forward-looking statements are based on management’s current
beliefs and assumptions and on information currently available to
management. The Company cautions that these statements are subject
to risks and uncertainties, many of which are outside of its
control, and could cause future events or results to be materially
different from those stated or implied in this press release,
including among others, risk factors that are described in the
Company’s Annual Reports on Form 10-K, Quarterly Reports on Form
10-Q, Current Reports on Form 8-K, and other filings with the SEC,
including the sections entitled “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” contained therein.
Media Contact
Natalie Silva publicrelations@rackspace.com
Investor Relations ContactSagar
Hebbarir@rackspace.com
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