Gap announces early results of tender offers, consent solicitations

Chicago, Sept. 27 – Gap, Inc. announced the early tender results of its cash tender offers and consent solicitations for any and all of its senior secured notes in a press release on Monday morning.

As of the early tender time at 5 p.m. ET on Sept. 24, the company received tenders for the following amounts of notes:

• $330,264,000 of the $500 million outstanding 8 3/8% senior secured notes due 2023 (Cusips: 364760AL2, U36547AC8) for $1,121.25 per note;

• $683,366,000 of the $750 million outstanding 8 5/8% senior secured notes due 2025 (Cusips: 364760AM0, U36547AD6) for $1,092.50 per note; and

• $904,583,000 of the $1 billion outstanding 8 7/8% senior secured notes due 2027 (Cusips: 364760AN8, U36547AE4) for $1,165 per note.

The purchase prices represent the payment per $1,000 note and the total consideration. The total considerations include a $30 early tender premium for noteholders who tendered by the early deadline.

Interest will also be paid to the relevant settlement date.

The company was also soliciting consents to change the restrictive covenants that would allow Gap to issue a notice of redemption with at least five days notice but not more than 60 days before the redemption date. The consent solicitations also terminate the security interest and release the collateral under the indenture for the related series of notes.

Noteholders who tender their notes will be deemed to have given consent, and noteholders may not give consent without tendering their notes.

As of the early deadline, for all three series the requisite consents had been received to change covenants regarding the notices of redemption. For the release of the collateral, the requisite consents had been received for the 2025 notes and the 2027 notes.

On Sept. 27, the company will executive a supplement indenture reflecting the consents received by the early deadline.

The offers were conditioned upon the receipt of at least $1.5 billion in proceeds from the issuance of new senior notes in a concurrent debt financing. The company sold $1.5 billion of notes on Sept. 13.

Financing for the tender offer will come from the new notes and cash on hand.

The early deadline was the withdrawal deadline.

Early settlement is scheduled for Sept. 27.

The offers and consent solicitations will expire at 11:59 p.m. ET on Oct. 8.

Final settlement is planned for two business days after the expiration deadline.

Citigroup Global Markets Inc. (800 558-3745, 212 723-6106) and Morgan Stanley & Co. LLC (800 624-1808, 212 761-1057) are the dealer managers and solicitation agents.

Global Bondholder Services Corp. is the tender and information agent (212 430-3774, 866 807-2200, contact@gbsc-usa.com).

Gap is a San Francisco-based retailer of clothing and accessories.

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