ModusLink Global Solutions, Inc. (“ModusLink”) (NASDAQ: MLNK) today
announced its intention to offer $75 million aggregate principal amount
of convertible senior notes due 2019 (the “notes”), subject to market
conditions and other factors. The notes are to be offered and sold to
qualified institutional buyers pursuant to Rule 144A promulgated under
the Securities Act of 1933, as amended (the “Securities Act”). ModusLink
also expects to grant the initial purchaser of the notes a 30-day option
to purchase up to an additional $11.25 million aggregate principal
amount of the notes.
The notes will be unsecured and unsubordinated obligations of ModusLink,
and will rank equal in right of payment with ModusLink’s other unsecured
and unsubordinated indebtedness, but will be effectively subordinated in
right of payment to any existing and future secured indebtedness and
liabilities to the extent of the value of the collateral securing those
obligations, and structurally subordinated to the indebtedness and other
liabilities of ModusLink’s subsidiaries. Interest will be payable
semi-annually in arrears, and the notes will be convertible into shares
of ModusLink’s common stock, or, if ModusLink obtains the required
consent from its shareholders, into shares of ModusLink’s common stock,
cash or a combination of cash and shares of its common stock, at
ModusLink’s election. Holders will have the right to require ModusLink
to repurchase their notes upon the occurrence of certain fundamental
changes, subject to certain conditions, at a repurchase price equal to
100% of the principal amount of the notes plus accrued and unpaid
interest. ModusLink will have the right to elect to cause the mandatory
conversion of the notes in whole, and not in part, at any time on or
after March 6, 2017, subject to certain conditions including that the
stock price of ModusLink exceeds a certain threshold. Final terms of the
notes, including the interest rate, conversion rate, offering price and
other terms, will be determined at the time of pricing based on
negotiations with the initial purchaser of the notes.
ModusLink intends to use the net proceeds from the offering for general
corporate purposes, which may include potential acquisitions and other
strategic business opportunities. No material acquisitions are probable
at this time.
This announcement does not constitute an offer to sell or a solicitation
of an offer to buy any of these securities (including ModusLink’s common
stock into which the notes will be convertible), nor shall there be any
offer, solicitation or sale in any state or jurisdiction in which such
an offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such state or
jurisdiction.
The notes and the shares of common stock issuable upon conversion of the
notes have not been and will not be registered under the Securities Act
or any other securities laws and may not be offered or sold in the
United States absent registration or an applicable exemption from the
registration requirements of the Securities Act and any other applicable
securities laws.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act of 1934, which include, without limitation,
statements about the market for ModusLink’s products, technology,
strategy, competition, expected financial performance, potential
acquisitions and strategic business opportunities and other aspects of
its business. Any statements about ModusLink’s business, financial
results, financial condition and operations contained in this press
release that are not statements of historical fact may be deemed to be
forward-looking statements. Without limiting the foregoing, the words
“believes,” “anticipates,” “expects,” “intends,” “plans,” “projects,” or
similar expressions are intended to identify forward-looking statements.
Although ModusLink believes that the expectations reflected in the
forward-looking statements are reasonable, it cannot guarantee future
results, levels of activity, performance, or achievements. ModusLink’s
actual results could differ materially from those expressed or implied
by these forward-looking statements as a result of various factors,
including the risk factors described in the “Risk Factors” sections of
ModusLink’s most recent annual report on Form 10-K and quarterly report
on Form 10-Q filed with the Securities and Exchange Commission, and a
variety of other factors. ModusLink urges you to consider these factors
carefully in evaluating the forward-looking statements contained in this
press release. The forward-looking statements included in this press
release are made only as of the date of this press release. ModusLink
undertakes no obligation to update publicly any forward-looking
statements for any reason, except as required by law, even as new
information becomes available or other events occur in the future.
ModusLink Global Solutions is a registered trademark of ModusLink Global
Solutions, Inc. All other company names and products are trademarks or
registered trademarks of their respective companies.
Copyright Business Wire 2014