rue21 Commences Modified "Dutch Auction" Cash Tender Offer for Its Common Stock

WARRENDALE, Pa., June 8, 2021 /PRNewswire/ -- Specialty retailer rue21 (r21 Holdings, Inc.) announced today that it is commencing a modified "Dutch Auction" tender offer (the "Offer") to purchase up to $80.0 million in aggregate value of its Class A Common Stock, par value $0.01 ("Class A Common Stock"), and Class B Common Stock, par value $0.01 (the "Class B Common Stock" and, together with the Class A Common Stock, the "Common Stock") at a cash purchase price not greater than $285 nor less than $250 per Share. The Offer commenced today, June 8, 2021. The Offer will expire at 5:00 p.m. New York City time on Wednesday, July 7, 2021, unless extended or earlier terminated by rue21 in its sole discretion (such date and time, as the same may be extended, the "Expiration Date"). Stockholders must validly tender and not validly withdraw their shares of Common Stock by the Expiration Date, in order to be eligible to receive consideration for their shares of Common Stock. 

rue21 is commencing the Offer as a means to provide value and increased liquidity to its stockholders. rue21's Board of Directors authorized the Offer after meaningful review and discussion with regard to the various options to maximize stockholder value. Given rue21's strong operating performance, the macro factors affecting the retail markets, as well as rue21's market position, the Board of Directors unanimously concluded that rue21's best path forward is to maintain the current capital structure as it seeks to continue to successfully implement its strategic initiatives. The Board of Directors is considering additional returns of excess capital to stockholders, including potentially in the near term and in addition to the Offer, through a dividend, share repurchases, tender offers or other methods of returns of capital to stockholders. There can be no assurance, however, that any amounts will be returned to stockholders, whether pursuant to the Offer or otherwise. rue21 remains focused on omnichannel customer growth, sales channel optimization and merchandise assortments that offer value, inclusivity and individuality.

A modified "Dutch Auction" tender offer allows stockholders to indicate how many shares of Common Stock and at what price (in increments of $5.00) within the range set forth above they wish to tender. Based on the number of shares of Common Stock tendered and the prices specified by the tendering stockholders, if the Offer is fully subscribed and if rue21 accepts Shares in the Offer, rue21 will determine the lowest price per share of Common Stock within the range that will enable it to purchase up to $80.0 million in aggregate value of shares of Common Stock (the "Final Purchase Price"). If, at the Expiration Date, the shares of Common Stock validly tendered at or below the Final Purchase Price exceed $80.0 million, then, subject to the terms and conditions of the Offer, rue21, if it accepts shares in the Offer, will accept for purchase, first, shares of Common Stock validly tendered at prices below the Final Purchase Price and, thereafter, shares of Common Stock validly tendered at the Final Purchase Price on a prorated basis according to the number of shares validly tendered. Shares of Common Stock not accepted as a result of proration and shares of Common Stock tendered at prices in excess of the Final Purchase Price will be rejected from the Offer and will be returned to tendering stockholders at rue21's expense promptly following the earlier of the settlement date or the date on which the Offer is terminated.  All shares of Common Stock purchased in the Offer will be purchased at the same price, even if the stockholder tendered at a lower price. Shares of Common Stock tendered at a price above the Final Purchase Price will not be purchased in the Offer. If the Offer is not fully subscribed as of the Expiration Date, all shares of Common Stock validly tendered at or prior to the Expiration Date may be accepted without proration at a per share purchase price equal to the highest bid price at or below $285 per share.

The Offer is subject to the terms and conditions described in the offer to purchase dated June 8, 2021 (as it may be amended or supplemented from time to time, the "Offer to Purchase") and related letter of transmittal (as it may be amended or supplemented from time to time, the "Letter of Transmittal"). The Offer will not be conditioned upon any minimum number of shares of Common Stock being tendered. The Offer will, however, be subject to other conditions, which are disclosed in the Offer to Purchase, including the requirement that the Offer comply with certain requirements under rue21's existing senior secured credit facility. To tender shares of Common Stock, stockholders must follow the instructions described in the Offer to Purchase and the Letter of Transmittal.

While rue21's Board of Directors has authorized rue21 to make the Offer, neither rue21 nor its Board of Directors makes any recommendation to any stockholder as to whether to tender or refrain from tendering any shares of Common Stock or as to the price or prices at which stockholders may choose to tender their shares. rue21 has not authorized any person to make any such recommendation. Stockholders must decide whether to tender their shares of Common Stock and, if so, how many shares to tender and at what price or prices to tender. In doing so, stockholders should carefully evaluate all of the information in the Offer documents, when available, before making any decision with respect to the Offer, and should consult their own broker or other financial and tax advisors.

Any requests for copies of the Offer to Purchase and any inquiries regarding the Offer may be directed to D.F. King & Co., Inc., the Information Agent for the Offer at (800) 967-5019 (Toll-Free) or (212) 269-5550 (Banks and Brokers).

This announcement shall not constitute an offer to purchase or a solicitation of an offer to sell Common Stock or any other securities. The Offer is being made only through and subject to the terms set forth in the Offer to Purchase and Letter of Transmittal and stockholders should carefully read these documents before making any decision with respect to the Offer. The Offer is not being made to holders in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction.

About rue21

rue21 is a fashion destination that promises to give customers quality styles at accessible prices. They offer the largest selection of products, sizes and trends that fit every personality and budget. Headquartered just north of Pittsburgh, Pennsylvania in Warrendale, they operate over 652 stores in 45 states and online at www.rue21.com.

Forward Looking Statements

The statements included in this news release may constitute "forward-looking statements" within the meaning of U.S. federal securities laws. Such statements can be identified by the use of forward-looking terminology such as "believes," "expects," "may," "estimates," "will," "would," "could," "should," "intends," "plans," "estimates," or "anticipates" or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy. The declaration and payment of dividends and/or any other transaction to return capital to stockholders, if any, will be subject to the discretion of rue21's Board of Directors and will depend, among other things, upon rue21's results of operations, financial condition, liquidity, capital adequacy, cash requirements, prospects, regulatory capital and limitations and other factors that rue21's Board of Directors may deem relevant. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and may involve significant risks and uncertainties, and that actual results may vary materially from those in the forward-looking statements as a result of various factors. rue21 disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.

Contact:
Joanna Doven
Premo Consultants
[email protected]

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SOURCE rue21