Exela Technologies Announces Pending Amendment

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  • Exela Announces Intention to Provide Voting Rights to Listed Series B Preferred Stock (Nasdaq: XELAP) by Distributing New Tandem Preferred Stock
  • Shareholders can now exchange blocks of 20 common shares for one share of the existing Series B negotiable preferred stock (Nasdaq: XELAP) with a liquidation preference of $25 and an annual dividend of 6%.
  • The liquidation preference represents a 257% premium to the stock’s closing price of $0.35 on April 15, 2022, the day before the launch of the initial offering
  • The dividend represents a yield of 21.4% based on the closing price on April 15, 2022
  • Common shares tendered will be withdrawn
  • Participating Shareholders should instruct their broker to deposit their Common Shares well in advance of the Expiry Time of 11:59 p.m. EST on May 16, 2022, to allow their broker sufficient time to deposit their Common Shares.

IRVING, Texas, May 02, 2022 (GLOBE NEWSWIRE) — Exela Technologies, Inc. (“Exela” or the “Company”) (NASDAQ: XELA) today announced that it has amended the previously announced exchange offer for shares of his company Series B Stock and Preferred Shares. In the Amended Offer (the “Offer”), shareholders can now exchange Common Shares in increments of 20 shares for one share of the existing, listed Series B Preferred Shares on the stock exchange (Nasdaq: XELAP) with a liquidation preference of $25, which after the Tandem Stock Dividend described below will have 20 votes per share. In light of the changes made to the offer, the Company has decided to terminate the offer to exchange the Series B preferred shares for a new series of preferred shares. Accordingly, existing holders of Series B Preferred Shares have no action to take.

Shareholders whose Common Shares are accepted for exchange under the Amended Exchange Offer will receive Series B Preferred Shares on the following terms:

  • Clearance Preference. Upon any liquidation of Exela, before any payment is made to common stockholders, Series B Preferred Stockholders are entitled to receive the greater of (1) $25 liquidation preference per share plus accrued and unpaid dividends, or (2) the amount the holder would have received had the Series B Preferred Shares been converted immediately prior to such event. Thus, upon any potential liquidation, a common stockholder who has exchanged their common stock for Series B Preferred Stock will receive at least as much as if they had not exchanged. The $25 liquidation preference, which is equivalent to $1.25 per common share, represents a 257% premium to the closing price of the common share on April 15, 2022.
  • Dividends. Holders of Series B Preferred Shares are entitled to receive both:
    • Cumulative dividends beginning March 11, 2022, at a rate of 6% per annum on the liquidation preference of $25 per share, representing a yield of 21.4% based on the closing price of common shares on April 15, 2022 , and
    • The right to participate in future dividends on our common stock.
  • Conversion. The right to convert their preferred shares into common shares at a conversion price of $1.25. Thus, a common stockholder who exchanges his common stock for Series B Preferred Stock will retain the right to participate in any increase in the value of the common stock above the conversion price of $1.25.
  • Vote. Following the tandem stock dividend, 20 votes per share, effectively retaining their existing voting rights.

The Company believes that the additional Series B Preferred Shares to be issued pursuant to the Offer, together with the Tandem Share Dividend Voting Rights, will result in an improved trading market for the Series B Preferred Shares. The Company has been informed by its Executive Chairman, Mr. Par Chadha, that he plans to participate fully in the Offer, it being understood that if the Offer is fully subscribed, he intends to limit his participation in the Offer to 20.6% of its Ordinary Shares. (representing the percentage of outstanding Common Shares sought under the Offer).

Exela also announced its intention to declare a dividend of one share of a new series of voting preferred shares (the “Tandem Preferred Shares”) for each outstanding Series B Preferred Share (the “Stock Dividend Tandem”), resulting in each Series B Preferred Share having 20 votes per share (representing the number of votes of the Common Shares delivered in exchange for one Series B Preferred Share). The declaration and payment of the Tandem Stock Dividend is subject to several conditions, and there can be no assurance that the Tandem Stock Dividend will be declared.

An amended and restated exchange offer has been filed with the United States Securities and Exchange Commission and may be retrieved at http://www.sec.gov. Common stockholders may contact DF King & Co., Inc., the Information Agent for the Offer, by calling Banks and Brokers, Call Collect: (212) 269-5550; all others, call toll-free: (888) 644-6071 or visit https://to.exelatech.com/ for this purpose.

This press release is for informational purposes only and does not constitute an offer to sell or exchange or the solicitation of an offer to buy the Preferred Shares or any other securities. The Offer is not being made to a person in any jurisdiction in which the offer, solicitation or sale is unlawful. Any offer of Preferred Shares will be made only by way of the exchange offer.

The complete terms and conditions of the offer are set forth in the amended and restated exchange offer dated May 2, 2022 and related amended and restated letter of transmittal which was filed with the Securities and Exchange Commission at appendix TO. Exela shareholders are strongly encouraged to read Schedule TO and related schedules, as they contain important information about the offer. Schedule TO and related exhibits will be available free of charge on the Securities and Exchange Commission’s website at http://www.sec.gov.

About Exela Technologies

Exela Technologies is a leader in business process automation (BPA), leveraging a global footprint and proprietary technology to deliver digital transformation solutions that improve quality, productivity and user experience final. With decades of experience operating mission-critical processes, Exela serves a growing list of more than 4,000 customers in 50 countries, including more than 60% of the Fortune® 100. Using core technologies spanning information management , workflow automation and integrated communications, Exela’s software and services include multi-industry and departmental solution suites addressing finance and accounting, human capital management and legal management, as well as industry-specific solutions for banking, healthcare, insurance and the public sector. With cloud-enabled platforms, built on a configurable stack of automation modules, and more than 17,000 employees operating in 23 countries, Exela is rapidly deploying integrated technology and operations as an end-to-end digital travel partner. end.

Forward-looking statements

Certain statements included in this press release are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally accompanied by words such as ” may”, “should”, “would”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “seem”, “seek”, “continue”, “future”, “will”, “expect”, “outlook” or other similar words, phrases or expressions. These forward-looking statements include statements about our industry, future events, estimated or expected future results and benefits, future opportunities for Exela, and other statements that are not historical facts. These statements are based on the current expectations of Exela’s management and do not constitute forecasts of actual performance. Such statements are subject to a number of risks and uncertainties, including, without limitation, those discussed under “Risk Factors” in the Exchange Offer and Exela’s Annual Report and other securities filings. In addition, forward-looking statements provide Exela’s expectations, plans or forecasts regarding future events and views as of the date of such communication. Exela anticipates that subsequent events and developments will cause Exela’s ratings to change. These forward-looking statements should not be relied upon as representing Exela’s assessments as of any date subsequent to the date of this press release.

Investor and/or media contacts:

Vincent Kondaveeti

E: [email protected]

Mary Beth Benjamin

E: [email protected]

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