RESTON, Va., March 16, 2020 /PRNewswire/ -- Internap
Corporation ("INAP" or "the Company") (NASDAQ: INAP) today
announced definitive steps through which it expects to
significantly reduce debt and extend maturities, equipping INAP to
generate the cash flows needed to grow the business and reinvest in
its products and customers. To support this strengthening of its
capital structure, INAP entered into a Restructuring Support
Agreement (the "RSA") with an ad hoc lender group (the "Ad Hoc
Lender Group") holding approximately 77% of its outstanding term
loans. With support of the Ad Hoc Lender Group, INAP and each of
its U.S. subsidiaries filed voluntary petitions under Chapter 11 of
the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the
Southern District of New York.
"INAP has been exploring strategic alternatives and financial
initiatives to best position the Company in an ever-evolving IT
infrastructure landscape. After a thoughtful evaluation of all
available options, today, we are taking decisive action to
strengthen our capital structure," said Peter Aquino, Chairman and Chief Executive
Officer. "We expect to emerge quickly, financially stronger and
well positioned to deliver our comprehensive portfolio of premium
data center infrastructure, best-in-class cloud solutions and
high-performance network services well into the future."
The Ad Hoc Lender Group has committed to providing the Company
with debtor-in-possession (DIP) financing of $75 million. This financing, combined with INAP's
existing operating cash flows, will allow all of INAP's businesses
to continue operating as usual and position the Company to drive
future growth. The Company's Plan of Reorganization, which is under
solicitation with lenders, anticipates INAP will emerge from this
process expeditiously as a private company with a significantly
improved strategic and financial position.
"We appreciate the support we have received from our existing
lender group, which underscores their belief in our business and
commitment to its growth," added Michael
Sicoli, President and Chief Financial Officer. "We look
forward to working with them closely as we move ahead to invest in
our business to meet the ever-growing demands of our customers and
channel partners."
The Company has filed customary motions that will allow it to
maintain employee wage and benefit programs, customer programs and
vendor payments for goods and services delivered in the ordinary
course, all of which are typical in the Chapter 11 process and
subject to Court approval. INAP expects these motions will be heard
in the first few days of its case. Further, INAP has requested
authority to pay all pre-petition trade payables in the ordinary
course throughout the Chapter 11 process.
INAP's non-U.S. subsidiaries, including iWeb Technologies,
Internap Network Services U.K. Limited, Internap Network Services
B.V., SingleHop B.V. and INAP Japan, are not part of the Company's
Chapter 11 cases, but are expected to benefit from the Company's
improved financial structure.
Additional information regarding the Chapter 11 filing is
included in a Current Report on Form 8-K which will be filed with
the U.S. Securities and Exchange Commission ("SEC") on Monday, March 16, 2020.
Further information about the Company's Chapter 11 cases can be
found at https://cases.primeclerk.com/inap or by calling (877)
720-6575.
INAP is advised in this matter by FTI Consulting as
restructuring advisor, Milbank LLP as legal counsel and Moelis
& Company as financial advisor.
About INAP
Internap Corporation (NASDAQ: INAP) is a leading-edge provider
of high-performance data center and cloud solutions with 100
network Points of Presence worldwide. INAP's full-spectrum
portfolio of high-density colocation, managed cloud hosting and
network solutions supports evolving IT infrastructure requirements
for customers ranging from the Fortune 500 to emerging startups.
INAP operates in 21 metropolitan markets, primarily in North America, with 14 INAP Data Center
Flagships connected by a low-latency, high-capacity fiber network.
For more information, visit www.INAP.com.
Forward-Looking Statements
Certain statements in this press release contain
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include statements regarding the Company's ability to
obtain approval by the Bankruptcy Court of the restructuring plan
contemplated by the RSA or any other plan of reorganization,
including the treatment of the claims of the Company's lenders,
vendors, trade creditors and equity holders, among others under
such plan; the Company's ability to obtain approval with respect to
motions in the Chapter 11 cases and the Bankruptcy Court's rulings
in the Chapter 11 cases and the outcome of the Chapter 11 cases in
general; the length of time the Company will operate under the
Chapter 11 cases and the continued availability of operating
capital during the pendency of the Chapter 11 cases or difficulty
in forecasting the liquidity requirements of the operations of the
Company's business; the potential adverse effects of the Chapter 11
cases on the Company's business, liquidity, results of operations
or business prospects; the unpredictability of the Company's
financial results while in Chapter 11 proceedings; the ability to
execute the Company's business and restructuring plan, including
the Company's ability to continue to serve customers, suppliers and
other business partners; increased legal and advisor costs related
to the Chapter 11 cases and other litigation and the inherent risks
involved in a bankruptcy process; the risk that the Chapter 11
cases may be converted to cases under Chapter 7 of the Bankruptcy
Code; the Company's ability to retain key executives and employees
during the Chapter 11 cases; the transactions contemplated by the
RSA being subject to closing conditions, which conditions may not
be satisfied for various reasons, including for reasons outside of
the Company's control and any statements or assumptions underlying
any of the foregoing. These statements are often identified by
words such as "may," "will," "seeks," "anticipates," "believes,"
"estimates," "expects," "projects," "forecasts," "plans,"
"intends," "continue," "could" or "should," that an "opportunity"
exists, that the Company is "positioned" for a particular result,
statements regarding the Company's vision or similar expressions or
variations. These statements are based on the beliefs and
expectations of the Company's management team based on information
available at the time such statements are made. Such
forward-looking statements are not guarantees of future performance
and are subject to risks and uncertainties that could cause actual
results to differ materially from those contemplated by such
forward-looking statements.
Therefore, actual future results and trends may differ
materially from what is forecast in such forward-looking statements
due to a variety of factors, including, without limitation: the
decisions of the Bankruptcy Court; negotiations with the Company's
lenders, creditors and equity holders; the Company's ability to
meet the requirements, and compliance with the terms, including
restrictive covenants, of the RSA and any other financial
arrangement during the pendency of the Chapter 11 cases; changes in
the Company's cash needs as compared to its historical operations
or its planned reductions in operating expense; adverse litigation;
changes in domestic and international demand for the Company's
products; the Company's ability to control operating costs and
other expenses; that general economic conditions, including as a
result of the outbreak of COVID-19, may be worse than expected;
that competition may increase significantly; changes in laws or
government regulations or policies affecting the Company's current
business operations.
These risks and other important factors discussed under the
caption "Risk Factors" in the Company's most recent Annual Report
on Form 10-K filed with the SEC and the Company's other reports
filed with the SEC could cause actual results to differ materially
from those expressed or implied by forward-looking statements made
in this press release.
Given these risks and uncertainties, investors should not place
undue reliance on forward-looking statements as a prediction of
actual results. All forward-looking statements attributable to the
Company or persons acting on the Company's behalf are expressly
qualified in their entirety by the foregoing forward-looking
statements. All such statements speak only as of the date made, and
the Company undertakes no obligation to update or revise publicly
any forward-looking statements, whether as a result of new
information, future events or otherwise.
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SOURCE Internap Corporation