FlexShopper Announces Exciting New Rights Offering
FlexShopper, Inc. (NASDAQ: FPAY) has recently taken a significant step that could positively impact its stockholders. The innovative financial technology company based in Boca Raton has filed a registration statement on Form S-1 with the Securities and Exchange Commission (SEC). This filing details a proposed rights offering designed to distribute non-transferable subscription rights to its stockholders, allowing them to purchase an impressive 35,000,000 units.
Each unit will comprise one share of common stock, commonly referred to as "Common Shares," along with three short-term rights for stockholders to acquire additional Common Shares at market-based prices that are lower than the typical trading price. This approach exemplifies FlexShopper’s dedication to its shareholders, creating an opportunity for greater equity participation.
Participation from Key Stakeholders
In an encouraging sign for investors, top executives and board directors of the Company have expressed their intentions to participate actively in the rights offering. Their involvement suggests confidence in the future prospects of FlexShopper and adds a personal touch that can resonate with other investors. This commitment aims to align the interests of the management team with those of stockholders, reinforcing trust and credibility within the investment community.
The Mechanics of the Rights Offering
Under the terms of this offering, stockholders who are recorded on a future yet-to-be-determined date will receive two unit subscription rights for each Common Share they own at no additional cost. This means that for every share held, investors will be granted an opportunity to purchase more, enhancing their stake in the Company at a favorable price. Details regarding the precise record date, subscription period, expiration dates, and pricing will be available in the final prospectus.
Stockholders who fully exercise their subscription rights will also have the ability to oversubscribe for additional units, contingent upon the availability of units that remain unpurchased by others. This structure underscores the Company's dedication to ensuring existing shareholders can maintain or boost their investment level, which is especially advantageous in a dynamic market environment.
Usage of Proceeds from the Rights Offering
The net proceeds from this rights offering are earmarked for pivotal uses that can fundamentally transform the Company’s landscape. FlexShopper plans to use the funds primarily for repurchasing over 90% of its Series 2 convertible preferred stock, which should stabilize and strengthen the overall capital structure.
Moreover, a portion of the proceeds will reduce outstanding balance under its credit facility, bolstering its financial standing. Additionally, FlexShopper is positioning itself to consider potential acquisitions of payment solutions companies, which would expand its market presence and enhance product offerings.
General Corporate Purposes
Any remaining funds will be allocated for general corporate purposes, ensuring the Company maintains flexibility and operational efficiency amidst changing market conditions. This multi-faceted usage of proceeds illustrates FlexShopper's strategic approach to growth, stability, and future readiness.
How to Get More Information
For stockholders seeking additional information regarding the rights offering, FlexShopper has designated MacKenzie Partners, Inc. as the Information Agent. Ringing either (212) 929-5500 (for bankers and brokers) or (800) 322-2885 (for all others) will connect you directly, while inquiries may also be sent by email to rightsoffer@mackenziepartners.com. When the prospectus becomes available, interested parties can obtain copies to review their options.
To manage this rights offering, FlexShopper has entrusted Moody Capital Solutions, Inc. as the dealer manager, ensuring a professional oversight of the entire process.
Conclusion
FlexShopper reserves the authority to terminate the proposed rights offering at any point before the expiration date and for any reason. This flexibility allows the Company to adapt to market conditions effectively.
FlexShopper, Inc. is a leader in the financial technology space, providing flexible payment options tailored for underserved consumers through its platform at Flexshopper.com and through partnerships with various merchants. Their dedication to innovation and meeting consumer needs will continue to foster growth and expand their impactful services.
Frequently Asked Questions
What is the purpose of the rights offering by FlexShopper?
The rights offering aims to distribute subscription rights to stockholders, allowing them to purchase additional shares, thereby increasing their ownership in the Company.
How many units can stockholders purchase?
Stockholders will have the option to purchase up to 35,000,000 units, with each unit consisting of one common share and rights for additional shares.
What will the proceeds from the rights offering be used for?
Proceeds will primarily be used to repurchase preferred stock, reduce credit facility balances, and finance potential acquisitions.
Who can participate in the rights offering?
Any stockholder of record on a future specified date will be entitled to participate in the offering.
How can I obtain more information about the rights offering?
Interested parties can contact FlexShopper’s Information Agent by phone or email for more details, and copies of the prospectus will be made available once finalized.
