NEW
YORK, May 20, 2024 /PRNewswire/ -- Peloton
Interactive, Inc. ("Peloton") (Nasdaq: PTON) today announced
that it intends to launch a global refinancing, pursuant to which
it will offer $275.0 million
aggregate principal amount of convertible senior notes due 2029
(the "notes") in a private offering (the "offering") and enter into
a $1.0 billion five-year term loan
facility (the "new term loan facility") and a $100.0 million five-year revolving credit
facility (together with the new term loan facility, the "new credit
facilities"). Peloton also expects to grant the initial purchasers
of the notes a 13-day option to purchase up to an
additional $41.3 million aggregate principal amount of
the notes.
Peloton intends to use the net proceeds of the offering of the
notes and the new credit facilities, together with cash on hand, to
repurchase approximately $800.0
million of its 0.00% convertible senior notes due 2026 (the
"Existing Notes"), to refinance its existing term loan and
revolving credit facilities and to pay fees and expenses related
thereto. The closing of the offering, the entry into the new credit
facilities and the repurchase of the Existing Notes are not
cross-conditioned upon each other, except the entry into the new
credit facilities is conditioned upon the repurchase of at least
$800.0 million aggregate principal
amount of the Existing Notes.
The notes will be senior, unsecured obligations of Peloton, and
will bear interest payable semi-annually in arrears. The notes will
be convertible into cash, shares of Peloton's Class A common
stock, or a combination thereof, at Peloton's election. The
interest rate, conversion rate and other terms of the notes are to
be determined upon pricing of the offering.
The notes will only be offered and sold to persons reasonably
believed to be qualified institutional buyers pursuant to Rule 144A
promulgated under the Securities Act of 1933, as amended (the
"Securities Act") by means of a private offering memorandum.
Neither the notes nor the shares of Peloton's Class A common
stock potentially issuable upon conversion of the notes, if any,
have been, or will be, registered under the Securities Act or the
securities laws of any other jurisdiction, and, unless so
registered, may not be offered or sold in the United States, except pursuant to an
applicable exemption from such registration requirements.
This announcement is neither an offer to sell nor a solicitation
of an offer to buy any of the notes or any shares of Class A
common stock potentially issuable upon conversion of the notes and
shall not constitute an offer, solicitation, or sale in any
jurisdiction in which such offer, solicitation, or sale is
unlawful.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. We intend such forward-looking statements to be covered by
the safe harbor provisions for forward-looking statements contained
in Section 27A of the Securities Act of 1933, as amended and
Section 21E of the Securities Exchange Act of 1934, as amended. All
statements contained in this press release other than statements of
historical fact, including, without limitation, statements
regarding our expectations regarding the proposed offering, the new
credit facilities and the repurchases of the Existing Notes, are
forward-looking statements. The words "believe," "may," "will,"
"estimate," "potential," "continue," "anticipate," "intend,"
"expect," "could," "would," "project," "plan," "target," and
similar expressions are intended to identify forward-looking
statements, though not all forward-looking statements use these
words or expressions.
We have based these forward-looking statements on our current
expectations and projections about future events and trends that we
believe may affect our financial condition, results of operations,
business strategy, short-term and long-term business operations and
objectives, and financial needs. These forward-looking statements
are subject to a number of risks, uncertainties, and assumptions
and other important factors that could cause actual results to
differ materially from those stated, including, without limitation:
our ability to achieve and maintain future profitability; our
ability to attract and maintain Subscribers; our ability to
accurately forecast consumer demand for our products and services
and adequately maintain our inventory; our ability to execute and
achieve the expected benefits of our restructuring initiatives and
other cost-saving measures and whether our efforts will result in
further actions or additional asset impairment charges that
adversely affect our business; our ability to effectively manage
our growth and costs; our ability to anticipate consumer
preferences and successfully develop and offer new products and
services in a timely manner, or effectively manage the introduction
of new or enhanced products and services; demand for our products
and services and growth of the Connected Fitness Products market;
our ability to maintain the value and reputation of the Peloton
brand; our reliance on a limited number of suppliers, contract
manufacturers, and logistics partners for our Connected Fitness
Products; our lack of control over suppliers, contract
manufacturers and logistics partners for our Connected Fitness
Products; our ability to predict our long-term performance and
declines in our revenue growth as our business matures; the effects
of increased competition in our markets and our ability to compete
effectively; any declines in sales of our Bike and Bike+; our
dependence on third-party licenses for use of music in our content;
actual or perceived defects in, or safety of, our products,
including any impact of product recalls or legal or regulatory
claims, proceedings or investigations involving our products;
increases in component costs, long lead times, supply shortages or
other supply chain disruptions; accidents, safety incidents or
workforce disruptions; seasonality or other fluctuations in our
quarterly results; our ability to generate class content; risks
related to acquisitions or dispositions, including the acquisition
of Precor; risks related to expansion into international
markets; disruptions or failures of information technology systems,
or websites; risks related to payment processing, cybersecurity, or
data privacy; risks related to the Peloton App and its ability to
work with a range of mobile and streaming technologies, systems,
networks, and standards; our ability to effectively price and
market our Connected Fitness Products and subscriptions and our
limited operating history with which to predict the profitability
of our subscription model; any inaccuracies in, or failure to
achieve, operational and business metrics or forecasts of market
growth; our ability to maintain effective internal control over
financial and management systems and remediate material weaknesses;
impacts from warranty claims or product returns; our ability to
maintain, protect, and enhance our intellectual property; our
ability to stay in compliance with laws and regulations that
currently apply or become applicable to our business both in
the United States and
internationally; our reliance on third parties for computing,
storage, processing and similar services and delivery and
installation of our products; our ability to attract and retain
highly skilled personnel and maintain our culture; risks related to
our common stock and indebtedness; our anticipated use of the net
proceeds from the offering; and those risks and uncertainties
described in the sections titled "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in
Part I, Item 2 of our Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2024
and the sections titled "Risk Factors" in Part I, Item 1A and
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" in Part II, Item 7 in our Annual Report on
Form 10-K for the fiscal year ended June 30,
2023, as such factors may be updated in our filings with the
Securities and Exchange Commission (the "SEC"), which are available
on the Investor Relations page of our website at
https://investor.onepeloton.com/investor-relations and on
the SEC website at www.sec.gov.
You should not rely upon forward-looking statements as
predictions of future events. The events and circumstances
reflected in the forward-looking statements may not be achieved or
occur. Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee
future results, performance, or achievements. Our forward-looking
statements speak only as of the date of this press release, and we
undertake no obligation to update any of these forward-looking
statements for any reason after the date of this press release or
to conform these statements to actual results or revised
expectations, except as required by law.
Investor Relations Contact:
James Marsh
investor@onepeloton.com
Press Contact:
Letena Lindsay
press@onepeloton.com
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SOURCE Peloton