BNED Receives $95 Million of New Equity Capital
Through $50 Million Equity Investment and $45 Million Fully
Backstopped Equity Rights Offering Led by Immersion Corporation
Converts Approximately $34 Million of Second
Lien Debt to Equity
Amends and Extends Four-Year Asset Based Loan
Facility to Provide Greater Financial and Operational
Flexibility
Company to Effectuate a 1-for-100 Reverse Stock
Split
Barnes & Noble Education, Inc. (NYSE: BNED) (“BNED” or the
“Company”), a leading solutions provider for the education
industry, today announced that it has successfully closed its
milestone equity and refinancing transactions (the “Transactions”)
with Immersion Corporation (NASDAQ: IMMR) (“Immersion”) and certain
of the Company’s existing stockholders and strategic partners.
These transactions will significantly strengthen BNED’s balance
sheet with more than $100 million of new equity and provide a
strong foundation for future growth and profitability.
Through the Transactions:
- The Company received gross proceeds of $95 million of new
equity capital through a $50 million new equity investment (the
“Private Investment”) and a $45 million fully backstopped equity
rights offering (the “Rights Offering”); the Transactions infused
approximately $80 million of net cash proceeds after transaction
costs;
- The Company’s existing second lien lenders, affiliates of
Fanatics, Lids, and VitalSource Technologies (“VitalSource”)
(collectively, the “Second Lien Lenders”), converted $34 million of
outstanding principal and any accrued and unpaid interest into
shares of Common Stock of the Company, par value $0.01 per share
(“Common Stock”); and
- The Company amended and extended its existing asset based loan
facility agented by Bank of America, N.A., pursuant to an agreement
with its first lien lenders, providing the Company with access to a
$325 million revolving loan facility (the “ABL Facility”) maturing
in 2028. The amended ABL Facility will meaningfully enhance BNED’s
financial flexibility and reduce its annual interest expense.
“We are pleased to announce the closing of the milestone equity
investment and bank refinancing transactions,” said Jonathan Shar,
Executive Vice President, BNED Retail and President, Barnes and
Noble College. “With a significantly improved balance sheet, we are
well-positioned to advance our industry leadership while continuing
to strategically invest in innovation and improve the experiences
and value we bring to our customers and partner institutions.”
“Immersion is excited to lead this investment into Barnes &
Noble Education. The Company plays an invaluable role in the higher
education sector, and we fully support its mission of driving
affordability, access, and achievement for students via our
academic partners nationwide,” said Eric Singer, President and
Chief Executive Officer of Immersion Corporation. “The new board
will be focused on accelerating BNED’s transformation and
strengthening its industry leadership, while driving profitable
growth and enhancing shareholder value.”
Changes to Board of Directors
Effective at the closing of the Transactions, as approved by
BNED stockholders, five new Directors and two existing Directors
were appointed to the Company’s Board of Directors:
- Eric Singer, President, CEO and Chairman of the Board of
Immersion Corporation
- Emily S. Hoffman, Chief Marketing Officer of SmartPak
- Sean Madnani, Chief Executive Officer of Twist Capital
- William C. Martin, Chief Strategy Officer of Immersion
Corporation
- Elias Nader, Chief Financial Officer of QuickLogic
Corporation
- Kathryn Eberle Walker, Chief Executive Officer, Presence
Learning Inc., Member of BNED Board of Directors since 2022
- Denise Warren, Founder and Chief Executive Officer of Netlyst,
LLC, Member of BNED Board of Directors since 2022
For more information on the newly appointed Board of Directors,
including full biographies, please refer to the Company’s
definitive proxy statement, dated as of May 15, 2024.
Additionally, effective at the closing of the Transactions,
Mario Dell’Aera Jr., David Golden, Michael Huseby, Steven Panagos,
Vice Admiral John Ryan, Rory Wallace, and Raphael Wallander
resigned from the Company’s Board of Directors.
Reverse Stock Split
The Board of Directors will effectuate a reverse stock split of
the Company’s outstanding shares of Common Stock at a ratio of
1-for-100 (the “Reverse Stock Split”), which was previously
approved by stockholders at a special meeting held on June 5, 2024.
The Reverse Stock Split will become effective at 5:01 p.m. Eastern
Time on Tuesday, June 11, 2024 (the “Effective Time”) and the
Company’s shares of Common Stock will begin trading on the New York
Stock Exchange (“NYSE”) on a reverse split-adjusted basis when the
NYSE opens on Wednesday, June 12, 2024. In connection with the
Reverse Stock Split, every 100 shares of the Company’s Common Stock
issued and outstanding as of the Effective Time will be
automatically converted into one share of the Company’s Common
Stock. No change will be made to the trading symbol for the
Company’s shares of Common Stock, “BNED,” in connection with the
Reverse Stock Split. The Reverse Stock Split is part of the
Company’s plan to regain compliance with the minimum bid price
requirement of $1.00 per share required to maintain continued
listing on the NYSE.
The Reverse Stock Split will reduce the number of shares of the
Company's outstanding Common Stock from approximately 2,620.5
million shares (as of the date of this press release, when
including issuances pursuant to the Transactions) to approximately
26.2 million shares, subject to adjustment for rounding. The
Reverse Stock Split will affect all issued and outstanding shares
of Common Stock. All outstanding options and restricted stock
units, and other securities entitling their holders to purchase or
otherwise receive shares of Common Stock will be adjusted as a
result of the Reverse Stock Split, as required by the terms of each
security. The number of shares available to be awarded under the
Company's equity compensation plans will also be appropriately
adjusted. Following the Reverse Stock Split, the par value of the
Common Stock will remain unchanged at $0.01 per share. The Reverse
Stock Split will not change the authorized number of shares of
Common Stock or preferred stock. No fractional shares will be
issued in connection with the reverse split; instead any fractional
shares as a result of the Reverse Stock Split will be rounded up to
the next whole number of post-split shares of Common Stock.
Additional information regarding the Reverse Stock Split is
available in the Company's definitive proxy statement, dated as of
May 15, 2024.
Advisors
Paul Hastings LLP served as legal advisor, and Houlihan Lokey,
Inc. and Berkeley Research Group, LLC served as financial advisors
to BNED. Pillsbury Winthrop Shaw Pittman LLP is serving as legal
advisor and BTIG LLC is serving as financial advisor to Immersion
Corporation. Choate Hall & Stewart LLP is serving as legal
advisor and B. Riley Securities, Inc. is serving as advisor to Bank
of America, N.A., as administrative agent under the asset based
revolving credit facility.
About Barnes & Noble Education, Inc.
Barnes & Noble Education, Inc. (NYSE: BNED) is a leading
solutions provider for the education industry, driving
affordability, access and achievement at hundreds of academic
institutions nationwide and ensuring millions of students are
equipped for success in the classroom and beyond. Through its
family of brands, BNED offers campus retail services and academic
solutions, wholesale capabilities and more. BNED is a company
serving all who work to elevate their lives through education,
supporting students, faculty and institutions as they make tomorrow
a better, more inclusive and smarter world. For more information,
visit www.bned.com.
About Immersion Corporation
Immersion, Inc. (NASDAQ: IMMR) is a Nasdaq-listed company in the
Russell 2000 that is primarily engaged in the business of
intellectual property licensing. Immersion is well capitalized with
over $200 million of cash and investments and no debt as of March
31, 2024.
Forward-Looking Statements
This press release contains certain “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995 and information relating to us and our business that are
based on the beliefs of our management as well as assumptions made
by and information currently available to our management. When used
in this communication, the words “anticipate,” “believe,”
“estimate,” “expect,” “intend,” “plan,” “will,” “forecasts,”
“projections,” and similar expressions, as they relate to us or our
management, identify forward-looking statements. Moreover, we
operate in a very competitive and rapidly changing environment. New
risks emerge from time to time. It is not possible for our
management to predict all risks, nor can we assess the impact of
all factors on our business or the extent to which any factor, or
combination of factors, may cause actual results to differ
materially from those contained in any forward-looking statements
we may make. In light of these risks, uncertainties and
assumptions, the future events and trends discussed in this press
release may not occur and actual results could differ materially
and adversely from those anticipated or implied in the
forward-looking statements. Such statements reflect our current
views with respect to future events, the outcome of which is
subject to certain risks, including, among others: the use of
proceeds and effects of the Transactions on the Company; our
preliminary unaudited Fiscal 2024 full-year financial results; the
completion, timing and effects of the Reverse Stock Split; the
amount of our indebtedness and ability to comply with covenants
applicable to current and/or any future debt financing; our ability
to satisfy future capital and liquidity requirements; our ability
to continue as a going concern; our ability to access the credit
and capital markets at the times and in the amounts needed and on
acceptable terms; our ability to maintain adequate liquidity levels
to support ongoing inventory purchases and related vendor payments
in a timely manner; our ability to attract and retain employees;
the pace of equitable and inclusive access adoption in the
marketplace is slower than anticipated and our ability to
successfully convert the majority of our institutions to our BNC
First Day® equitable and inclusive access course material models or
successfully compete with third parties that provide similar
equitable and inclusive access solutions; the United States
Department of Education has recently proposed regulatory changes
that, if adopted as proposed, could impact equitable and inclusive
access models across the higher education industry; the strategic
objectives, successful integration, anticipated synergies, and/or
other expected potential benefits of various strategic and
restructuring initiative, may not be fully realized or may take
longer than expected; dependency on strategic service provider
relationships, such as with VitalSource Technologies, Inc. and the
Fanatics Retail Group Fulfillment, LLC (“Fanatics”) and Fanatics
Lids College, Inc. D/B/A "Lids" (“Lids”), and the potential for
adverse operational and financial changes to these strategic
service provider relationships, may adversely impact our business;
non-renewal of managed bookstore, physical and/or online store
contracts and higher-than-anticipated store closings; decisions by
K-12 schools, colleges and universities to outsource their physical
and/or online bookstore operations or change the operation of their
bookstores; general competitive conditions, including actions our
competitors and content providers may take to grow their
businesses; the risk of changes in price or in formats of course
materials by publishers, which could negatively impact revenues and
margin; changes to purchase or rental terms, payment terms, return
policies, the discount or margin on products or other terms with
our suppliers; product shortages, including decreases in the used
textbook inventory supply associated with the implementation of
publishers’ digital offerings and direct to student textbook
consignment rental programs; work stoppages or increases in labor
costs; possible increases in shipping rates or interruptions in
shipping services; a decline in college enrollment or decreased
funding available for students; decreased consumer demand for our
products, low growth or declining sales; the general economic
environment and consumer spending patterns; trends and challenges
to our business and in the locations in which we have stores; risks
associated with operation or performance of MBS Textbook Exchange,
LLC’s point-of-sales systems that are sold to college bookstore
customers; technological changes, including the adoption of
artificial intelligence technologies for educational content; risks
associated with counterfeit and piracy of digital and print
materials; risks associated with the potential loss of control over
personal information; risks associated with the potential
misappropriation of our intellectual property; disruptions to our
information technology systems, infrastructure, data, supplier
systems, and customer ordering and payment systems due to computer
malware, viruses, hacking and phishing attacks, resulting in harm
to our business and results of operations; disruption of or
interference with third party service providers and our own
proprietary technology; risks associated with the impact that
public health crises, epidemics, and pandemics, such as the
COVID-19 pandemic, have on the overall demand for BNED products and
services, our operations, the operations of our suppliers, service
providers, and campus partners, and the effectiveness of our
response to these risks; lingering impacts that public health
crises may have on the ability of our suppliers to manufacture or
source products, particularly from outside of the United States;
changes in applicable domestic and international laws, rules or
regulations, including, without limitation, U.S. tax reform,
changes in tax rates, laws and regulations, as well as related
guidance; changes in and enactment of applicable laws, rules or
regulations or changes in enforcement practices including, without
limitation, with regard to consumer data privacy rights, which may
restrict or prohibit our use of consumer personal information for
texts, emails, interest based online advertising, or similar
marketing and sales activities; adverse results from litigation,
governmental investigations, tax-related proceedings, or audits;
changes in accounting standards; and the other risks and
uncertainties detailed in the section titled “Risk Factors” in Part
I - Item 1A in our Annual Report on Form 10-K for the fiscal year
ended April 29, 2023 and in Part II – Item 1A in our Quarterly
Reports on Form 10-Q. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results or outcomes may vary materially from
those described as anticipated, believed, estimated, expected,
intended or planned. Subsequent written and oral forward-looking
statements attributable to us or persons acting on our behalf are
expressly qualified in their entirety by the cautionary statements
in this paragraph. We undertake no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise after the date of this
press release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240611193740/en/
BNED – Media and Investors Hunter Blankenbaker Vice
President – Corporate Communications and Investor Relations (908)
991-2776 hblankenbaker@bned.com
Grafico Azioni Barnes and Noble Education (NYSE:BNED)
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Da Ott 2024 a Nov 2024
Grafico Azioni Barnes and Noble Education (NYSE:BNED)
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