Barnes & Noble Education, Inc. (NYSE:BNED) has entered into an agreement with BTIG, LLC to sell up to $40 million of its common stock through an "at-the-market" equity offering program. The announcement was made today, as part of a regulatory filing with the Securities and Exchange Commission (SEC).
Under the terms of the sales agreement, the company may sell shares from time to time at its discretion, setting parameters such as the number of shares, time period for sales, and minimum price limits. BTIG, acting as the sales agent, is authorized to sell shares on the New York Stock Exchange or other markets where BNED's stock is traded.
With a current debt-to-equity ratio of 2.11 and total debt of $432.24 million, this offering could help address the company's financial obligations.
Barnes & Noble (NYSE:BKS_old) Education will pay BTIG a commission of 2% on the gross proceeds from the sale of the stock. Moreover, the company has agreed to provide BTIG with indemnification rights and to cover half of BTIG's reasonable out-of-pocket expenses, including legal fees, related to this agreement.
The sales agreement can be terminated by either party under certain conditions, including a material adverse change in the company. The company is not obligated to sell any specific number of shares under this agreement.
The share offering will be conducted pursuant to the company's shelf registration statement, including a prospectus filed on December 11, 2024, and declared effective as of today, supplemented by a prospectus supplement dated today.
The legal opinion of Pillsbury Winthrop Shaw Pittman LLP regarding the validity of the common stock being offered has been filed with the SEC as part of the company's current report on Form 8-K.
This move allows Barnes & Noble Education to potentially raise capital flexibly as market conditions permit. The company has not specified how it intends to use the proceeds from the sale of the common stock.
Investors are reminded that this report does not constitute an offer to sell or a solicitation of an offer to buy any securities. The offering of securities is subject to state securities laws.
In other recent news, Barnes & Noble Education has undergone significant changes in its financial reporting structure, executive lineup, and financial strategy.
The company has consolidated its reportable segments into a single operating and reporting segment, a move that aligns with the information reviewed by the Chief Operating Decision Maker. The company also announced the resignations of Kevin Watson, Executive Vice President and Chief Financial Officer, and Seema Paul, the Chief Accounting Officer, with Jason Snagusky appointed as the new CFO.
Barnes & Noble Education has reduced its total number of authorized shares of common stock from 10 billion to 200 million. The company also launched a $40 million at-the-market equity offering program in partnership with BTIG, LLC, aiming to provide flexibility in capital management.
Moreover, the company secured $95 million in equity capital led by Immersion (NASDAQ:IMMR) Corporation and announced plans to refinance an asset-backed loan facility with a new $325 million facility maturing in 2028.
Barnes & Noble Education also appointed BDO USA as its new independent public accounting firm for the fiscal year ending May 3, 2025. Despite these developments, Needham maintained a hold rating on the company's stock after the release of mixed preliminary financial results for fiscal year 2024.
While revenue fell short of expectations, the company's adjusted EBITDA surpassed forecasts. These are recent developments and it is important for investors to stay updated on the company's moves.
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